This article adds to the ongoing debate on the relationship between poverty reduction, profits, and environmental sustainability. Drawing from the literature, it presents a conceptual model with propositions to explain how social entrepreneurs can lead to sustainable development in developing countries. These propositions are further strengthened by using a descriptive case of Waste Concern—an initiative of social entrepreneurs—in Bangladesh. Findings illustrate that, despite contextual constraints in developing countries, it is possible to have sustainable development with no trade-off between poverty reduction and environmental sustainability. This win-win outcome is possible through the innovative approaches and creative thinking of social entrepreneurs who, rather than being hindered by contextual constraints, act as catalysts for sustainable development. The findings have implications for academics and policy-makers, highlighting the significance of supporting social entrepreneurs to come up with innovative methods for sustainable development.