Good Tips for Starting a Social Enterprise

I just came across a wonderful article in the United Kingdom called "The business of doing good:  How to start a social enterprise" with 10 tips for eager entrepreneurs wanting to make a difference.

These tips come from an organization called the Local Enterprise Growth Initiative based in Leeds, England.  Although UK based, these tips are universal and should be shared.  I've placed my notes and opinions here in brackets.  These tips are:

1. Ask yourself what are your social aims and objectives? How are they social aims, rather than 'business' aims? You need to be honest about whether you are a social enterprise or not. [Note:  The Social Enterprise term has been used in many cases.  If you have a double or triple bottom line philosophy, it may be appropriate to consider yourself a social enterprise.]


2. Choose a legal form that suits what you want to do. Some organizations chose to be an industrial & provident Society because they want to involve members of the local community in the business, but a community interest company might suit you better and is becoming an increasingly well understood brand.  [Note:  In the United States, this may take the form of a 501(c)3 for classic nonprofit organizations with Unrelated Business Income activities subject to the Unrelated Business Income Tax (UBIT).  Also, the new Low-Profit Limited Liability Company (L3C) form may be a new viable option once Vermont, North Carolina and Montana have passed legislation.]


3. A social enterprise is still a business, so you will need a plan that has realistic timescales and cash flows. Plan, plan, plan. [Note:  For those who've followed 1000 Cranes Philosophy...this is in line with our second principle:  "Success Comes from Planning and Execution."]


4. Don't skimp on market research. Find out if other people are already offering a similar service or product, how much it costs, and what their market is. The yellow pages or the internet are good places to start. [Note: I am also a huge proponent of market focus groups.  You need to get direct feedback from your customers.]


5. Find out if there other people you can collaborate with. If you don't have the skills yourself to deliver the idea, get skilled up first, or find someone who has the skills already. [Note:  Another key principle with 1000 Cranes is "Success comes from collaborative relationships."  There is no doubt that you can't do this alone.]


6. Get a critical friend to be a sounding board. It's good to have someone supporting you who will challenge your own assumptions. [Note:  I would also recommend forming a Mastermind group in order to bounce ideas from several supportive members.  This provides multiple viewpoints and accountability.]


7. Don't try to set up a competitive product in an already crowded marketplace. It's important to find out what makes you different from the competition – your product, how you present it, how you price it. Keep asking yourself what's different, and why this could benefit people. [Note:  This goes back to market research...you just can't do enough of this.  This should be an ongoing process to determine how you fit in the market and how the market is changing.]


8. You may think your idea is so great and you're doing the right thing with your profits or workforce, but you can't rely on people searching you out to give you business. If you have a great story, tell it - have a good marketing plan. [Note:  Whether you choose to market through direct mail, print advertising, blogging, podcasting or a variety of methods, you need to ensure you are prominent in the mind of your buyer.]


9. Try to use other social enterprises as your suppliers, and support others in the same position as you. [Note:  Building your network with other social enterprises is a great way to "Pay it forward".  One of the things we do at 1000 Cranes every year is purchase holiday cards that support a nonprofit organization.  This way we give back and thank our customers at the same time.]


10. Every entrepreneur needs support when it gets lonely. Build a network and talk to other social entrepreneurs. It's good to moan about how the bank doesn't understand you to someone who's had the same experience! [Note:  This is why conferences in your field are important to attend.  It is an opportunity for you to reach out and network with others who understand your field and leverage each others' experiences.]

For more information about Sharing the Success, visit www.sharingthesuccess.co.uk

Have you considered starting a social enterprise and what service would you provide the community?

What plans have you started in support of a social enterprise (marketing, operations, management, etc.)?

What additional support do you need to become successful? 

Comments

[Evan Carmichael]

Thanks for the suggestions Naomi! We launched a Mastermind Group Resources Blog to give entrepreneurs strategies to get the most from their Mastermind Groups and I was pleased to see your post! If you are interested in being a guest blogger on our blog to discuss Mastermind Groups, just email me!

Keep up the great work!

Evan.

[Naomi Takeuchi]

Glad you enjoyed the post, Evan! I agree that Mastermind groups are a wonderful resource that more people should enjoy.

Will send you an email to discuss further!

Thanks for posting!

Naomi

[Dan Martin]

I wrote the article you refer to Naomi. Many thanks for your kind words.

I'm a huge fan of social enterprise and I'm convinced that it's the future of business.

The sector is certainly picking up steam over here in the UK. I attended Voice 08, the year's big social enterprise conference, a few months ago and around 1,500 delegates turned up which shows it's not a sector which should be underestimated.

Dan Martin
Editor, BusinessZone.co.uk

[Naomi Takeuchi]

Dan,

Thanks for sharing your words of wisdom! You're right that the sector is growing by leaps and bounds. I anticipate we'll hear similar trends at the Social Enterprise World Forum in Edinburgh in September.

Keep up the great work!

[Alberto Nardelli]

This a great article and the 10 tips really nail down essential guiding principles.

Will share this on UnLtdWorld.com (the online platform connecting thousands of social entrepreneurs worldwide), as I'm sure loads of members will find it really helpful.

[Naomi Takeuchi]

Thanks, Alberto, for posting your comments. I agree that it's definitely worth sharing! I'm sure Dan from the Business Zone in the UK will be glad to hear his article is gaining traction. Thanks for sharing!