How to Plan a Social Enterprise
A social enterprise is a business whose primary goal is (i) to do social good, and (ii) to make money. They are increasing in popularity as talented individuals who want to make a social contribution see traditional donation-dependent charities as inefficient and unsustainable.
The solution? To create a business whose revenues can finance and sustain the founder’s social, environmental, cultural or economic mission.
So, if you love business and you’re looking to make a difference, creating a social enterprise may be the perfect solution for you. But where do you start? What if you know you want to make a difference but you’re not sure how? The following exercises will help you identify a cause close to your heart; how you can contribute and how to build a viable social business around your chosen cause.
Planning your social enterprise
In The Social Entrepreneur Revoulution by Martin Clark, the author outlines a useful 10-step process to plan your social business. It’s an effective process and not a spreadsheet or cashflow forecast in sight. Instead, it focuses on harnessing the powerful emotions and motivations that drives an individual’s decision to begin a social enterprise and combines this with sound business planning.
Here’s are the questions posed by Clark. Answer each one and at the end of the exercise you should have a solid, actionable plan for social enterprise:
- It is wrong that…
- What is the pain you’re trying to solve?
- What is going on in your community, country or the world that moves you?
- What do you think is an injustice?
- What social problem is begging for a better solution?
- Draw up a list of things you would like to change. You are only brainstorming at this stage so feel free to jot down anything that comes to mind.
- It should be like this…
- For each problem you have identified, define your idea solution.
- What is your vision?
- What needs to change to fix the problem?
- If you could wave a magic wand, what would the solution look like?
- Choose your cause. You may have a long list of problems and solutions. It’s time to choose one. If you are having trouble deciding, here is a useful exercise. Create a “round robin” tournament for your problems. Take two problems on your list at random and ask yourself, “Which problem am I more committed to solving?” Keep that one and cross the other off your list. Repeat the process (until there is only one problem left standing). That’s the one to work on.
- How can I create my vision?
- What are all the possible solutions to this problem?
- What is already being done to solve it?
- What are the pros and cons of each of these existing responses?
- What gaps do they leave that a new response could address?
- What problems and obstacles would a new response need to overcome?
- Of all the proposed solutions, the most intuitively promising is…
- What are the strengths and weaknesses of the idea?
- Is this a problem that needs solving?
- Can it be realistically address by the strategy I’ve envisaged?
- Is the vision right? Is it compelling?
- How can the strategy be improved?
- Ask five people you respect to critique your idea. These people don’t have to be in your personal circle – you can approach people you admire, e.g. experts, authors, speakers, entrepreneuers etc. who you feel would have valuable insight.
- How could it happen in the real world?
- How would your enterprise make money?
- How would you market it?
- Can it generate enough revenue to support itself?
- Is it sustainable or just a short-term project?
- Do you need to setup an organisation?
- How do you balance the social and business aspects of what you do?
- Who do I need to work with me?
- Think about your friends, colleagues, neighbours and contacts. Who could you choose for your dream team? Who would make your idea a success?
- At a minimum you need the following people on your startup team: a doer; a visionary; a salesperson; a finance person. One person can fulfill multiple roles.
- Who do I need to persuade to get on my side?
- Who can you call on to support your solution? Is there someone famous who you could approach? Is there a company you can align with?
- Get social media on your side. In many ways, it’s never been easier to start a social enterprise. If your cause touches the hearts of money, the power of social media can spread your message like wildfire.
- Can you work with local government agencies? Any solution that tackles a social problem can get support from civic bodies looking to tackle the same challenge.
- Where will the money and people come from?
- What range of products or services can you sell?
- Can you bolt on a revenue centre to your idea, e.g. café/restaurant, consultancy, live events, hiring out facilities, acquiring/leveraging assets, collaborating with local businesses. Ask yourself, “What value can we offer the market?” Jamie Oliver’s social enterprise, the restaurant Fifteen, offers value in the form of a restaurant. He then combined that with the social good of training vulnerable/disadvantaged young people to cook and run the rest
- This is the time of Kickstarter, Indiegogo, GoFundMe… and other crowdfunding platforms. If enough people believe in your idea they can help support your vision.
- How quickly can I start to make a difference?
- Can you build an MVP – a “minimum viable product”. In other words, before you invest time and money, can you test the viability of your idea? This may take the form of asking people to place a pre-order for your product or service. Or, promoting the business on Facebook to gauge interest.
- Who will be your first customer?