There’s a way to make money and do good for society. It’s by having more people create social enterprises. If nothing else, what we’re learning is that there’s no need for for-profits and social change to be mutually exclusive. And, in today’s world, this is fast becoming a booming area for innovators.
1) Make Money and Do Social Good
Depending on your country, there may well be varying definitions. In the United States, social entrepreneurs seek to impact the social challenges we’ve faced for generations. Moreover, social entrepreneurs look to bring the best practices, ideas, and concepts of the for-profit and nonprofit sectors and fuse them.
However, whether social enterprises get designated as a nonprofit or for-profit business for tax purposes, two core objectives exist:
- They seek to generate revenue.
- They also want to achieve social impact.
Generally, for nonprofits to get designated as social enterprises, they need to be selling something. For instance, they could sell artisan crafts from communities in need of commercial exposure. Maybe they sell a brand or issue awareness apparel and products. In short, social enterprises measure not only profits but also social outcomes and impact.
If either of these elements is missing, the organization may be socially-minded, but it’s not a social enterprise. Social enterprises also seek to incorporate communities and people who haven’t typically benefited from the economy. For instance, some may support female entrepreneurs in developing countries.
In sum, social entrepreneurs want to create market solutions to social challenges. They know the challenges that exist in society and want to improve things. And because of changing ideas, driven by tech and globalization, more people want to create social enterprises.
2) Personal Qualities of a Successful Social Entrepreneur
Various types of social entrepreneurs exist. For example, some love to establish start-ups and develop them over their early years. Others prefer to go into well-established organizations. They feed the entrepreneurial flame by developing new initiatives or programs and not necessarily creating a new business. So, they look to reorganize and take things to the next level. However, all social entrepreneurs want innovative solutions for social change.
If you’d like to develop a social enterprise, the first place to begin is by looking in the mirror.
The best social entrepreneurs have the following qualities:
Belief: Social entrepreneurs believe in themselves. In other words, they believe in the work they do. They believe in the team that surrounds them. And, more importantly, they believe when others don’t. They make the necessary sacrifices and commitments to succeed. Entrepreneurs understand the world is more extensive than they are, and they also know they can make an impact. You see it in their actions. In turn, they recruit people and supporters to help them achieve success.
Temperament: Social entrepreneurs have a certain temperament. Meaning they don’t get easily deterred. They also see things that many people might not yet see. Remember, social entrepreneurs seek solutions and innovation. And when dealing with challenges that have been with us for generations, it may even require seeing something that may not yet exist. In short, that’s the very definition of innovation.
Leadership: Successful social entrepreneurs have to hone their leadership skills. As a social entrepreneur, you can’t possibly make a great social impact without the help and support. And, if you want to do things that haven’t gotten created, it’s going to take quite a bit of charisma and leadership to get others to follow you to success. So, be committed to developing your leadership skills.
Creativity: Almost by definition, social entrepreneurs have to be creative. Imagination and ingenuity lead to innovative ways of thinking and doing things. As social entrepreneurs, they want to make profits and social impact. We live in a world where a lot of people have “been there and done that.” We can quickly see what’s worked and what hasn’t. But in the 21st Century, we also have technology, and that’s a game-changer. How about you break the box and build a whole new one if it leads to success?
3) Where to Find Investment Money For Your Social Enterprise
Yes, a lot of business success has to do with the “Benjamins.” To make a social impact as a social entrepreneur, you also want to make a profit. There are opportunities from self-funding to investment capital (e.g., impact investing). Increasingly, funders are open to investing money for social good and not only into traditional nonprofits. There’s an urgency to solve issues, with the advances we’ve made in technology, for many funders. And that means they seek alternative enterprises that want to develop and take programs to scale.
Social enterprises need to have resources. They need investment capital for their operation, research, development, marketing, sales, management, etc. Also, as a social entrepreneur, you need a solid vision and philosophy. Finally, you want a great team and business plan. You want to know very well what you’re trying to accomplish, how, and why.
Here are some places for you to consider:
Ashoka Innovators for the Public: The network is one of the most significant social enterprise groups globally. They have more than 3,500 fellows representing 95 countries. Ashoka provides start-up financing, professional support, and networking opportunities.
B Lab: This group is all about using business as a force for good. It accomplishes this by building and supporting a community of Certified B Corporations. Those are for-profit companies. Certified B Lab companies meet rigorous standards of social and environmental performance, accountability, and transparency.
GlobalGiving: This organization is the first and largest global crowdfunding community on the planet. It connects nonprofits, donors, and companies in nearly every country around the world. They help local organizations access the funding, tools, training, and support needed to become more effective and make our world a better place.
Global Impact Investing Network: This organization addresses systemic barriers to effective impact investing. They accomplish this by building critical infrastructure. They also develop activities, education, and research that attract more investment capital for poverty alleviation and the environment.
4) The Best Ideas for Good
If you’re serious about social good and making a profit, it’s possible to create a successful social enterprise. The following are some ideas to spark anyone thinking of creating a social enterprise.
Online marketplace: Working with artisans from developing nations worldwide. Your social enterprise can build a bridge for sellers to global buyers. You can charge a listing, commission, or membership fee.
Micro-lending: Kiva did an incredible job demonstrating how micro-lending happens successfully. It has a greater than 98% repayment rate in developing countries. With innovative thinking and technology, you could build something similar to engaging customers who may pay a fee to join.
Environmentally friendly products: People want to purchase products that are not harming the environment, animals or causing cancer and other diseases.
We live in extraordinary times. Never has so much possibility been so close to reality because of today’s technology and knowledge. Consumers and brand supporters are also looking to align with socially responsible businesses. In short, social enterprises provide an entrepreneur with the opportunity to make a profit and create social change. For entrepreneurs, that’s exciting.
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