Addressing a gap in the social entrepreneurship literature, this paper explores the combined economic and socio-cultural and political difficulties inherent in addressing ‘social market failures’ by social enterprises in developing countries. Statistical analysis, interviews and observations of Grameen Shakti (Village Energy) are used to explore its approach to addressing energy market failures in rural Bangladesh. The paper finds that while Grameen Shakti is exceeding expectations in rural energy technology sales, it has had difficulties reaching the poorest for both financial and socio-cultural reasons. Political reflections, drawing from the broader ‘development literature’, suggest, further, that product-focused social enterprises are generally not well equipped to deal with the complex socio-political issues underlying energy poverty.