There’s something about December that leads many nonprofit organizations down the road of thinking about new plans with new energy. Maybe it’s the idea of January being a reboot moment – we know that feeling well!
One thing that lots of nonprofit organizations might be thinking about this time of year is starting a social enterprise. It’s a big and important question: the idea of a nonprofit launching a related business enterprise to bring in additional, non-grant revenue, while also supporting the nonprofit’s mission, vision, and values is something that is exciting — and something that can be world changing!
But there’s a key question that you need to ask: what can you, as a nonprofit do, that would be a successful social enterprise?
What’s your viable business idea?
This probably seems like a ridiculously simple question – but it’s one that a lot of nonprofits struggle with. Many times, when they come up with the idea to build a social enterprise, they cast about thinking about things that they can do to make money. And sometimes there’s a massive disconnect between what the organization is good at and what it chooses to do as a social enterprise. And that can lead to some significant challenges.
Here’s an example: imagine a seniors’ organization that arranges transportation, meal preparation, check-ins, and bulk grocery purchases. Imagine they want to build a social enterprise. And they come up with an idea of selling soap. Where’s the connection between what the organization is good at? Where’s the connection between the organization’s goals and what it can do for its target clients and audience?
There isn’t one – which means the nonprofit would likely need to bring on staff to handle soap production, soap delivery, and so much more. Then when it comes to assessing the potential of the social enterprise to build the success of the nonprofit, the assessment can come up lacking.
If your nonprofit is considering starting a social enterprise, you need to ask yourself a question: what do we do well that we could build into a social enterprise?
Here’s a chart that should help you consider this a bit more clearly:
That overlap between what you’re good at and what can make money is where your nonprofit’s social enterprise can have the most impact.
Let’s take that imaginary seniors’ organization that arranges transportation, does meal preparation, and bulk grocery purchases. Imagine if, instead of starting a soap making social enterprise, they built on what where their already demonstrated strengths: food, meal preparation, and transportation, and if they leveraged something valuable they’re already doing: bulk grocery purchases. Could they build a social enterprises that uses these strengths? Maybe one that does catering? Maybe delivered meals? Maybe they could employ some of their seniors in this business.
Asking the simple question – what do we do well that we could build into a social enterprise – is a quick way to evaluate your potential social enterprise ideas and ensure that you’re going down the best possible path.
The path to building a social enterprise isn’t always easy. But if you want to engage a team to help you traverse that path, then we’re here for you. Get in touch.