So, you’d like to start your own business creating social impact?

This article was written by Commongood Careers and is published under a Creative Commons Attribution-NonCommerical-NoDerivs 2.5 License.

A socially entrepreneurial organization (SEO) takes the goal of creating social impact to a new level by using innovative methods to organize, manage and measure a venture.  If you’re looking to make high impact in the social change arena and have a new, enterprising plan on how to do it, starting your own SEO could be a great choice for success.  In this article, we give you some tips on how to start a SEO that can survive, thrive, and even change the world.

The Emerging Field

The idea of social entrepreneurship is not new.  The legacy of social entrepreneurs even reaches back to include historical figures like Florence Nightengale and Theodore Roosevelt. However, the term “social entrepreneur” became much more widespread in the 1980s, and today the movement is picking up more speed than ever.

“[Today’s social entrepreneurs] have such an opportunity. There are no hard and fast rules.  It’s a whole new kind of hybrid world that brings together the best of both the for-profit and nonprofit sectors,” said Jerr Boschee, Executive Director of The Institute for Social Entrepreneurs and Visiting Professor of the Practice in Social Enterprise at Carnegie Mellon University.

The growth of this movement stems from the realization that “successful social entrepreneurs possess the same competencies as traditional business entrepreneurs, such as the abilities to plan strategically, manage people and programs, and measure results,” said Chaula Kothari, Director of Teach For America’s Social Entrepreneurship Initiative. These skills applied to SEOs create stronger, more sustainable organizations that assess their impact in tangible ways, and with excellent results.

Social Enterprise vs. Social Innovation

In the emerging world of SEOs, there are near limitless options for exploration, but two basic directions from which to approach them.  These are social enterprise and social innovation.  The differences are mostly in emphasis and final execution, although both rely on best practices, measurable results, and a socially-connected bottom line to drive their organizations.

Starting a social enterprise “is not all that different from starting a business,” said Boschee.  A social enterprise is generally a venture whose ultimate purpose is social good and that advances and supports its social mission through a revenue generating mechanism guided by entrepreneurial principles.  It does not rely on fundraising or other more traditional nonprofit areas of revenue.

Social enterprises take many forms and are becoming more and more prevalent.  Hot Bread Kitchen, for example, is a bakery that promotes independence and growth for immigrant women by creating professional opportunities for immigrant women as bakers.  The bakery sells various breads and rolls and then uses the profits to pay a competitive wage to its workers, as well as encourage its employees to start their own businesses.

Social innovators, on the other hand, start new organizations with the idea of systemic change that they use to create a sustainable organization. This can lead to organizations with better practices, more efficient management, and higher impact.  While sometimes social innovators take an existing nonprofit and begin thinking in new ways to come up with systemic changes, Boschee said, much social innovation starts from scratch.

Social innovators fill a societal need not already addressed or take a new approach to meeting a need that is currently insufficiently addressed.  For example, the Education for Democracy Foundation is a cooperative effort between Polish and American pro-democratic educators to promote knowledge of democracy and provide skills for civic activity in a democratic state.  The organization gathers groups of between 10-15 volunteers, mainly made up of teachers, who are taught how to address both specific democratic issues as well as broader civic participation concerns in a training that takes the course of a year.

“The idea isn’t to adhere slavishly to either a social innovation or social enterprise model,” Boschee continued.  “The real challenge is to discover which one of them is the best approach for meeting a specific social need.”

Five Steps to Starting Your Own SEO

As a starting point, here are five concrete steps to help you plan to launch a socially entrepreneurial organization:

1) Clarify your objectives — Consider the ultimate goal of this SEO.  What social need will it meet and how will it meet it?  They should be issues that you are passionate about and that you really believe in.

2) Find a balance — Always keep in mind that the success of your SEO relies on a balance between sustainable social change endeavors and sustainable business practices.  What balance will make your organization most successful?

3) Research the field — Learn from the people who have come before you and don’t limit yourself in the scope of your research.  See how other organizations and businesses, whether public or private, have used innovative methods.  Try to learn from their mistakes.  Make contacts and consider partnerships if it is appropriate.  (For a unique conversation about failed social ventures, look at a recent discussion on Social Edge)

4) Understand your market
— It is essential to have a good understanding of the market for your product or service if you hope to make an impact.  Know who you will be serving and what they really need.  Always make sure what you are providing is something that the people you will be serving need.

5) Know your numbers
— Understand at least the basics of managing the finances your organization will be working with.  An ambitious vision for your organization will certainly get you somewhere, but if you don’t have a clear understanding of what makes your organization work financially, you won’t be able to plan strategically or make complete decisions.  (For a comprehensive list of FAQs about nonprofit finance management visit CompassPoint’s Nonprofit Genie)

Some Expert Advice

Starting your own SEO has some solid steps, but it also takes much more than simply following any single process.  Kothari and Boschee both say there are a few things that transcend the basic how-to of starting a SEO.

“If you plan to start your own organization, you need to be absolutely committed to and happy with what you are doing,” Kothari commented.  “If you’re not happy to take on the challenges that come with starting your own organization, you will not do a good job of helping others.”

Boschee agreed, saying “don’t do it unless it is literally the most exciting thing in your life.”  A passion for the mission and the work of an organization is what makes it most successful.

“However, be candid with yourself if the results are not really there,” Boschee added.  There is an important balance between passion for continuing a mission and understanding when to move on from a venture.

Ultimately, today’s social entrepreneurs have the opportunity to take advantage of the exciting changes in the nonprofit sector.  They have the chance to be innovative and make a difference in the world in a way that is promising and fresh.  “Social entrepreneurs look at social need with a new set of lenses,” Boschee said. “There are no rules for today’s social entrepreneurs.  They can be the trailblazers.”


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