Get Started: Building a Social Enterprise

Do you have a passion for solving social challenges? Then, put your skills at work and turn your passion into a potential successful venture. Social enterprises are businesses driven by the desire to solve social challenges. Interested in combining good-deeds and profitable actions? Africa Report has compiled a few tips to help you start your own social enterprise.

Tip 1. Find a need
What are you most passionate about? You’ve heard it often, what you are passionate about could make a great foundation for a potential venture. But what annoys you could also be a great platform to uncover business opportunities. If something is not working properly, if you find something around you that is lacking, for example, the unavailability of affordable education, then finding solutions to counter these problems can be the starting point of an exciting venture. Environmental degradation, food shortage, bad roads or lack of health facilities: identify a need either from things you love doing or things that irritate you the most and make you want to find a solution and you may find a niche market. The next step will be for you to conduct research to establish if the need can make a viable business side.

Tip 2. The business model
You have found a social challenge and you are now ready to fight it. What is your business model? Come up with innovative and profitable ways of solving that specific challenge. 2009 Africa Social Entrepreneur of the Year, David Kuria says he was irritated by poor sanitation amongst Kenya’s low income earners and therefore decided to start an enterprise that would offer effective sanitation at an affordable rate. One of the ways worth exploring is making consumers of your service pay albeit at a lower cost. Other options can revolve around collecting waste and recycling into products that can later be sold. This would not only be profitable but also contribute in cleaning the environment. There are many possibilities to solve challenges. Find yours and base your business on those ideas.

Tip 3. The business plan
Just like other businesses, social enterprises need to have a clear business plan demonstrating the gaps they are going to fill, prospective growth trajectory, sustainability and goals. At this stage, it is important to consult with other successful social entrepreneurs on how best to draft a fundable business plan. Your idea might be demonstrating social benefits but it should also catch the eyes of prospective investors or business partners.

Tip 4. Pilot project
Most investors approach social enterprises cautiously. The reason? They expect return on their investment. It might not be that easy to convince a venture capital fund to finance your business idea on poverty eradication by just presenting a business plan.  Christine Kapkusum, a Senior Associate at Acumen Fund, a venture capital fund, advises to implement a pilot project first. This will practically prove that indeed the idea is viable, profitable and has a social impact. As a result, it will be easier to win the confidence of any potential investor and/or business partners.

Tip 5. Marketing
Just like other for-profit enterprises it is critical to market your social enterprises. The mode you use will determine how effective your marketing campaign will be. For instance, a project focused on improving lives of rural marginalized communities that may not have access to newspapers, media flow and general information, would derive more benefits from holding workshops than placing adverts in newspapers. Having an online presence through a website or social media like Twitter, Facebook and blogging is critical in creating awareness about your project and communicating with communities, partners and financiers.

Tip 6. Network
Another important tip is to create linkages with other stakeholders.  This will make it easier to access more opportunities, share experiences and exchange knowledge.

Tip 7. Think entrepreneurship
For your venture to be successful and sustainable, think, be, eat, drink “entrepreneurship.” Always bear in mind that as a social entrepreneur, you are running a for-profit organization not a charity.  It is important to be innovative both in service delivery and creative business growth. You should learn how to form partnerships with other like-minded organizations and retain your employees by rewarding top performing staff. You should also build on your personal skills such as communication, management and anything that may add value to your business.

Social enterprises face the same challenges as any other business start- up. Granted, it is no walk in the park, but the motivation and joy of solving a social challenge will keep you going in the tough times. Good luck!