Doing Well By Doing Good: Who Are Today’s Social Entrepreneurs? (Infographic)
Social entrepreneurs seek to solve the world’s social and environmental problems through revenue-generating enterprises that champion innovative solutions.
Social entrepreneurs are a big-hearted breed. They care deeply about more than earning a profit. They’re also passionate about making a difference.
For some, such as Yoobi founder Ido Leffler and TOMS Shoes founder Blake Mycoskie, that means donating a product to an individual in need for every product purchased. For others, such as Scholly co-founder Christopher Gray, that means helping low-income students find the scholarship money they need to make their college dreams come true.
To succeed as a social entrepreneur, as these inspiring changemakers have, you also need more than a great purpose-driven business idea. You need a step-by-step plan and the commitment to see it through, says C.J. Hayden, a San Francisco-based social entrepreneurship coach and founding board member of the San Francisco Bay Area Chapter of the Social Enterprise Alliance.
“If you feel called to make more of a difference in the world and want to make a living while doing it, you’ll need a clear roadmap for your journey,” Hayden, a social venture founder herself, said in an interview. “A specific set of directions to get your business from a flash of inspiration to off the ground is required.”
Here are seven practical, actionable steps that Hayden suggests carefully following to become a successful social entrepreneur — and to truly be the change you wish to see in the world:
1. Write a mission statement.
“Start by deciding precisely who you want to serve and exactly where and how you want to serve them. Be equally clear about the problem you’d like to solve for this demographic through your business service or product.
Think about your natural talents, core competencies, professional skills and training, and access to needed resources. Ask yourself simple guiding questions like ‘What will I do?’ ‘How will I do it?’ ‘Who am I doing it for?’ and ‘What value will I provide?’ The answers to those questions will inform your mission statement.”
How to Change the World: Social Entrepreneurs and the Power of New Ideas, by David Bornstein
The Power of Unreasonable People: How Social Entrepreneurs Create Markets That Change the World, by John Elkington and Pamela Hartigan
2. Research the field.
“Learn more about the social business landscape you want to work in and see who the players are and how they’re changing the world. Don’t reinvent the wheel. If a social entrepreneur out there is already doing exactly what you want to do, use that as inspiration and fuel to come up with your own distinctly different purpose-driven offering.
Google is your friend here in finding those who you might consider competitors or collaborators. Also, if you were someone who wanted to engage with a business offering that you want to offer, what would he or she search the web for? What specific keyword search terms would he or she use? See yourself as your ideal customer or beneficiary and search online through that lens.
You’ll also want to research trade associations specific to social entrepreneurship. The Social Enterprise Alliance, which has 16 chapters throughout the U.S., is a great first resource to reach out to. See who the members of this group are and what types of social enterprises they’re operating.
Further honing in, research trade associations geared toward your particular potential offering. For example, if you aim to provide office supplies using the popular one-for-one donations model, you’ll want to reach out to the National Office Products Alliance. See what the people there are teaching their members and the topics they’re talking about at meetings and conferences. This will help you get the pulse of what’s going on in the field you hope to enter.”
List of industry trade groups in the U.S.
3. Conceptualize your unique offering.
“How can you offer something different than what others are already offering? The more grounding and granularity you have in what you want to do and how you will innovatively do it — ideally in ways that have not been done before — the more unique your social enterprise will be.
A helpful exercise here is to grab a pad of Post-It notes and to put on each note a word that is directly related to what you’re trying to accomplish with your social enterprise. Then stick the notes on walls or windows where you can easily see them and move them around in different combinations.
Over several days or weeks, continue to adjust your sticky notes, keeping in mind what you want to achieve and who you want to help, plus how you can do all of that uniquely, as only you can within your own specific social niche.
Or, if you can’t be entirely different from others already in the field you’re venturing into, think about ways you can add value to their efforts, perhaps collaboratively.”
From Idea to Concept: The 3 Stage Business Plan for Aspiring Entrepreneurs, by John Endris
4. Reach out to team members for feedback and support.
“What I mean by ‘team member’ is not necessarily someone who is going to work with you and for you, either as a business partner or an employee. Rather, it’s someone who will be a steadfast supporter of what you’re trying to accomplish through your purpose-driven venture. Someone who is on your team, rooting for you.
To gather outside support, look to people already in your life and career who you consider to be trusted mentors and advisors. Or, they may be some of the competitors and collaborators you came across when researching the field, or members of relevant trade associations that you looked into. They could also simply be like-minded souls who want to make a difference, too, or already have.
Team members are people you can freely, openly bounce ideas off of and seek feedback and advice from. People who have been in your shoes before who can help guide you to success, ideally opening up their networks and resource pools along the way to propel you forward.
Present your supporters and mentors with your mission statement, and simply see what they think about it. You’ll have to have a thick skin when doing this because some may provide very strong corrective criticism. Remember that your team members likely have good intentions and want to see you succeed.”
5. Develop your business model.
“A business model is a roadmap for how your enterprise is going to make money. Think about just how far you want your services and/or products to reach. Are you going to be satisfied with serving and assisting just the number of customers that you yourself can serve locally as one person? Or are you going to need to expand and hire in order to make a bigger impact?
Decide and document exactly how much money you want or need for this social enterprise to bring in order to support your mission, pay for itself, pay you, and anyone you might hire, and to perhaps eventually expand. What specific type of business model will lead to the earnings you require and desire?
Also ask yourself if the beneficiaries of your enterprise’s goals will pay for your enterprise themselves, or are you going to have one group of people pay for your products and then have another group of people be beneficiaries? For example, the one-for-one model of TOMS Shoes has one group of people — consumers — paying for the shoes and individuals in need are the beneficiaries, which is a very common social business model.
An example of a social enterprise where the beneficiaries themselves pay for products or services is microlending ventures. These increasingly popular business model structures involve making microfinance loans to people who pay interest. The interest collected from them funds the repayment of the loans and provides profits, as well as funding for additional loans to be made.
Once you settle on which type of social enterprise business model fits your business concept best — and there are many to choose from — consider putting your chosen model forth in a local social entrepreneurship pitch competition, with the goal of refining it as much as possible.”
Business Model Generation: A Handbook For Visionaries, Game Changers and Challengers, by Alexander Osterwalder and Yves Pigneur
Power to the People: How to Create a Profitable Social Enterprise, article by bplans.com
Global Social Venture Competition
6. Identify initial funding sources.
“This is where you’ll want to do your homework to find out where you’ll source seed funding from. Where will you obtain the funding you need to launch and what will be required to get it?
Will you seek a traditional business loan or can you afford to self-finance? Will you look to friends and family for loans or reach out to angel investors and venture capitalists?
What about perhaps crowdfunding your social enterprise through Indiegogo [as Lisa Curtis did to get her global poverty-fighting superfood startup Kuli Kuli, Inc. off the ground]? Crowdfunding is a particularly wise move if you already enjoy some early success as a startup social venture, and have a large mailing list or e-newsletter subscriber base you can broadcast your crowdfunding campaigns to. If you don’t have broad target demographic reach or a significant social following, crowdfunding might only produce very small amounts of funding and may not be worth the time investment on your part.
One of the best funding options specifically for social enterprises are impact investing groups, which exclusively fund purpose-driven companies. The aforementioned Social Venture Network is a great place to connect with investors that fall in this growing category.
As with any kind of outside investing, you’ll want to be cautious that the investors you work with are 100 percent behind your social mission, and not just investing in order to get the highest return possible.”
The Art of Startup Fundraising: Pitching Investors, Negotiating the Deal, and Everything Else Entrepreneurs Need to Know, by Alejandro Cremades and Barbara Corcoran
The Global Impact Investing Network
Investopedia’s Top 5 Impact Investing Firms
RSF Social Finance
7. Write an action plan (and stick to it).
“An action plan — not to be confused with a business plan — very specifically lays out the to-do tasks and action items you need to commit to and by when. It will include the exact date you want to launch your social venture and how long it will take you to get there, working backward from that date.
Your action plan is your master to-do list, it’s your schedule, it’s your calendar. Build it around your annual, monthly, weekly, daily and even hourly entrepreneurial goals.
Particularly when you’re starting up from scratch and you don’t have outside accountability to anyone, carefully creating an action plan — and meticulously following it — is absolutely essential to staying on track. When you do, you can transform your dreams of changing the world into reality.”