This move was in keeping with the growing trend of partnerships between the private and social sectors, and of transferring knowledge between the two. At the time, such strategic liaisons were gaining ground, not only in Brazil, but across Latin America and in many other countries as well.

McKinsey was chosen as a partner because of its long-standing relationship with Ashoka (it was a McKinsey consultant, William Drayton, who founded Ashoka in 1980), its expertise in business consultancy, the fact that it has offices worldwide, and the company's willingness to work with social issues. The challenge of working in a completely different reality from the "normal" business routine has been highly rewarding for many McKinsey consultants who have volunteered to work with the CSE.

"It is really gratifying (when working on these projects) to see how a little advice goes such a long way, and how a little effort can make such a difference," said David Edelstein of McKinsey, comparing his work on CSE projects with his usual business consultancies.

The CSE offers social entrepreneurs services such as consulting, training, contests, exchanges and systemization of information. McKinsey consultants bring their expertise and experience in the business arena to the CSOs, enabling them to become more professional and effective. Consultants offer help with issues such as fundraising, institutional diagnostics, strategic analysis, developing financial autonomy, organizational strengthening, and development of new technologies for a specific public.

CSE consulting projects are staffed by a manager, associates and business analysts. Though the work is voluntary, standards measure up to what the consultants' are ordinarily expected to contribute to a consulting project. The projects typically last for three to four months, and the consultants work up to three hours per week.

Having full-time staff manage the relationship between Ashoka and McKinsey is a key element in the success of the partnership. Though commitment is strong from both partners, difficulties do arise: for example, it's not always easy to get people really committed when work is volunteer-based.

It is important too, not to have unrealistically high expectations regarding the number of people who will get involved. Communication is crucial: the best advertisement for further involvement is to advertise results.

Consultants themselves find that the results pay off. After three years of testing the model, and having seen its positive results, Ashoka CSE Director Anamaria Schindler advises anyone who is interested in developing a similar joint venture: Keep it simple!

I Scratch Your Back, Mine Gets Scratched Too!

Sometimes the wave of enthusiasm from McKinsey consultants carries them beyond the project and they opt to participate directly in the community as well. Working with an Ashoka Fellow at this level, they might engage in activities ranging from joining voluntary housebuilding teams, to giving English classes or writing letters for illiterate or destitute street people.

This is one of the main reasons for the success of the partnership. On the one hand, the CSOs learn the necessary business skills, while on the other, the consultants end up loving a "job" that gives them the added satisfaction of doing something really worthwhile.

For example, Marcos Fernandes has expanded his consultancy role with the CSE to include some extra hours teaching English to children on the outskirts of Sao Paulo. Explaining his close involvement Fernandes says, "Our objective in the project is to serve as a bridge between a community that lacks opportunities and another community that has them. This is only possible through direct contact with the children, so they can change their paradigms of where they want to, and can, go."

Such an attitude of community involvement is not the norm in Brazil, where voluntary work is still relatively rare – except in its unofficial form of neighbor-help-neighbor. Public services are totally lacking in poorer areas.

The Genesis of the Idea

For more than two decades, Ashoka has been identifying and investing in individual social entrepreneurs worldwide who have cutting-edge, innovative ideas. Along the way, Ashoka realized the urgent need to strengthen institutional development needs that vary according to the stage of development of a project.

As a direct response to this need, in 1996, a group of about 10 people – Ashoka Fellows, McKinsey consultants, and representatives of institutions related to social causes – joined to establish the CSE. It was decided to have the CSE office in the McKinsey premises itself, to facilitate communication with McKinsey

Bridging the language gap between the two worlds of NcKinsey and the CSOs they serve is seen as hugely important, because CSO-speak is often ideologically different from business-speak. "My first job is to adjust the different languages," says Schindler, "One of the main problems we encounter is the difference in expectations and language between social entrepreneurs and consultants."

Once projects have been shortlisted by Schindler, McKinsey consultant Claudio Sanches, co-manager of the CSE, sends out notices seeking volunteers. He then carefully identifies consultants for each project, depending on their interests and expertise.

Sanches estimates that he regularly receives responses from 20 percent of McKinsey consultants. "We discovered that many of our consultants are eager to do something to help social causes," says Sanches, who himself has a history of volunteering on projects. "The returns on our work might not be tangible, but they are high in terms of personal satisfaction."

Finding the Gaps and Filling Them

Over time, the CSE has identified two main problems faced by social entrepreneurs: fundraising and sustainability. Even for Ashoka Fellow Rodrigo Baggio, who is working to close the digital divide between the "haves" and the "have-nots," and successfully operates 117 computer schools in the slums of 13 Brazilian states, the biggest challenge for his organization is sustainability. He would welcome expert intervention in this area.

Rodrigo Baggio (center front) with some of his students from the Cantagalo slum in Rio de Janeiro

According to João Jorge Rodrigues, another Ashoka Fellow, "the biggest problems social entrepreneurs face are communication with society, and the availability of resources." He sees filling this need as a real challenge.

To encourage innovative solutions, the CSE runs two annual contests. The Citizen Base Competition, which started in 1996 in Brazil, stimulates creative strategies for resource mobilization. The competition is part of Ashoka's global Citizen Base Initiative (CBI), which is carried out in partnership with the CSE.

The goal of CBI is to shift the thinking and practices of civil society institutions from reliance on a small group of international funders to a more diversified base of support. Finalists receive training from Ashoka and McKinsey staff, and the best strategies for creative resource mobilization receive free consultancies and prizes in cash.

Winners are chosen by a jury comprising a McKinsey consultant and representatives of Brazilian civil society. Ashoka runs similar competitions in Thailand, India, Bangladesh and South Africa.

The Business Plan Contest was developed in 1999 to encourage innovative solutions for the sustainability of CSOs. The first contest was open only to Ashoka Fellows, but future competitions are likely be open to other social entrepreneurs as well.

The seven selected proposals (out of a total of 14 entries) received basic training from McKinsey consultants over a five-month period to structure their business plans so they achieve financial sustainability. This included problem solving, business planning, communication and accounting. For many of the competitors, the five-month consultancy was a major learning experience, and was the biggest prize.

Since winning the Business Plan competition in 1999, Criola's coordinators have been working closely with McKinsey consultants, and they are enthusiastic about the results. "It's made all the difference," said Werneck. "This was completely unknown territory for us – this world of business, investments, interest, and capital. Now we are learning, step-by-step, how to go about finding the funds we need, and how to develop strategies. We had all the elements (in the plan), but didn't know how to go about it. It's still a foreign way of thinking for us!"

To help familiarize social entrepreneurs with this "foreign way of thinking," the CSE has developed a unique and highly original Simulation Game. In a three-day workshop, selected Ashoka Fellows, social leaders and executives of CSOs administer fictitious social organizations and have to negotiate funds for their projects.

In round after round, they are expected to convince the group – acting as potential donors – to back their projects. Invited guests masquerade as representatives of businesses, the local government, banks, the press, the hospitality industry (hotels), foundations, and even as rich socialites!

McKinsey consultants Jamil Said and Leonardo Letelier (who represented a banker and an ironworks businessman, respectively, from a virtual small seaside resort) reported that: "To be able to interact with real social entrepreneurs was a unique chance of transforming a little of what we learn at McKinsey into fundraising techniques. In this short space of time, we observed how quickly (they) learned these techniques, and how a little bit of our time can contribute to the development of people and social organizations."

Though McKinsey works closely with Ashoka in many parts of the world, the CSE is a uniquely successful partnership. The boldness of the plan has generated interest in McKinsey offices worldwide, and already McKinsey's Argentina, Mexico and India branches are developing similar, though not quite as structured, programs.