The concept of social enterprise is still new and emerging, although there is a growing number of social enterprises that are currently demonstrating their potential by providing innovative solutions to tackle social challenges and issues in diverse sectors across countries.
- Is your organization focused on solving social, cultural or environmental problems and creating effective responses to such challenges?
- Do you have the ability to reinvest the majority of profits towards your social impact?
- Does your business have a social and/or environmental mission statement?
- Do you sell a product of service as part of your business and generate income through trading?
If the answer is a YES, then your business is a social enterprise as they are core criterias.
Social enterprises are initiatives that believe in making a positive impact on the world while creating livelihoods for themselves, equitable opportunities for others – all while building a sustainable profitable company.
Social enterprise is increasingly capturing imaginations across the rest of the world. We have glaring evidence of increasing activity in the form of social start-ups, incubators and accelerators and the emergence of social or impact investment. More and more NGOs and CSOs seem to be looking at social enterprise as a potential model to ensure longer term sustainability of their operations.
However, to date there is little quantitative evidence of how many social enterprises there are in many countries or detail about their operations and
Social enterprises can generate profit, but may also rely on donations or sponsors. Success is often difficult to measure but must be financially sustainable and focus on creating a positive impact.
I would like to share funding sources and strategies to achieve successful grant opportunities for your social enterprise.
Alot of times, founders are not vocal about what they do and this makes them less accountable. Pitch competitions are ideal to position you for grants, strength in telling your story and most importantly, having an accountability partner and mentor from these pitch competitions. Most accelerators, incubators and competitions include mentoring into these pitch programs because it gives founders a deep business root of knowing how to spend these grants and pivot their initiatives to a more sustainable enterprise.
Income Revenue and Fees
To stabilize your cash flow and strengthen relationships with the communities that you serve, you will need to diversify your funding portfolio. This speaks to applying a subscription or B2B model where you have customers feel comfortable to pay a fee for what you offer.
In the beginning, it may be hard because you may be trying to penetrate and win the market or offering a service for free or you may not even have a product yet. Identify a unique proposition that differentiates you from a competitor. Identify a sales strategy that aligns to your mission and start from your immediate circle in marketing.
Try to gather as much feedback as possible. Customers want to feel heard and appreciated. Most customers can even assist to extend your offering to their circle.
In-kind support is often tied to organizations or bodies who would prefer to give you a value of their resources. For example, you may have a program and you reach out to Coca Cola for sponsorship. They may prefer to give you a total worth of refreshment based on the proposal request. Most FMCG organizations apply this dynamic in their CSR or sponsorship plans, and it serves the purpose of fulfilling their CSR goal and marketing their product during the event.
Implementing Cost Reduction Strategies
This involves social entrepreneurs identifying a partner who can bring economic value to both parties. The partner may have intellectual value or property to contribute that adds value to the venture in a unique way. The beauty of this strategy is that it’s a win-win situation for both parties.
Grants and Donations
The major advantage of applying for grants and donations is that they are equity free and you are not required to generate revenue or returns. Grants are most common in social enterprises. Identify or research on foundations and organizations that award grants. Do this on a monthly basis and select grants that are tied to your thematic area or pillar of your enterprise.
Social investment is the use of repayable finance to achieve a social as well as a financial return. Lender’s enterprises and charities that may be considered too risky for banks or traditional lenders, can often take repayable finance from a social investor, giving access to finance that may otherwise be unobtainable.
In fundraising, pay attention to your story and the data you collate to share. Be intentional and purposeful about capturing all relevant data centered on the problem you are solving and the solution you aim to bring onboard. Create an empathetic narrative or story that ties to what you are solving and want to achieve at a certain time.
Amanda is a seasoned leader and board member with a comprehensive background in managing social enterprises, start-ups, and complex organizations across Africa, Europe, and the MENA region. She is recognized for her dedication to sustainability and her ability to develop highly effective teams, enhance revenue through strategic partnerships, and skillfully manage change to optimize community service operations.
Her role encompasses the management of bilateral and multilateral partnerships as well as the representation of organizations on policy issues at national levels and through various media platforms.
Amanda has a track record of leading strategic planning and execution, coordinating humanitarian efforts, and pioneering educational reforms. Her contributions as part of the African Union CESASTEM Cluster have been instrumental in driving forward educator reforms, policies, and the implementation of improved instructional methodologies in STEM education.