Social Entrepreneurship: How To Save The World And Make The Big Bucks
Hey, guys! Today is a great day because I get to talk about something that is very near and dear to my heart- social entrepreneurship. (AKA- the perfect combination of passion, purpose, and financial freedom.
I find social entrepreneurs completely fascinating. They embody everything I love about entrepreneurs, from their endless drive and big imagination, to their quest for greatness and slightly rebellious nature.
In addition, though, they display something else that makes them even more idyllic. Which is, they have a purpose and mission in their businesses to solve problems in our world that aren’t getting the attention they deserve.
Case Study: Imperfect Produce
One of the newest and coolest social businesses rocketing out of San Francisco today is Imperfect Produce.
Imperfect’s mission is to “fight food waste by finding a home for ‘ugly’ produce.” After realizing that more than 20% of perfectly good fruits and veggies in the United States are immediately thrown out, the founders of IP decided to begin rehoming them instead.
Prior to this movement, any fruit or vegetable that even slightly deviated from grocery store sizing standards was thrown away before it even left the farm it was grown on.
Now Imperfect Produce offers customizable delivery boxes of produce cheaper than can be found at most grocery stores. They forge contracts with local farmers to buy misfit produce for pennies on the dollar, and then deliver that produce straight to households at a discounted rate.
This system is a huge win for everyone involved. Farmers are now paid for something that they previously would have written off as a complete loss. Land, water, and fuel isn’t wasted growing produce that will be immediately sent to the dumpster.
Social awareness of waste and food sustainability is improving. And of course, the founders of Imperfect Produce have the joy of purpose and a solid paycheck to drive them.
The Tide Is Turning
One thing I love about the millennial generation (that’s me!) is the awareness that we’ve cultivated about world issues. Despite facing real problems in the job market and in personal finance, we’ve committed ourselves as a whole to holding companies responsible for their actions.
In fact, millennials are using their dollars to vote for socially and environmentally conscious companies so much that those with unsustainable farming and transportation practices are being forced to change their practices or face going belly up.
According to this report, 94% of millennials want to use their skills to benefit a cause in the world. That’s a big number, and it indicates an important change in the world of business. Social entrepreneurship is rising rapidly, and for good reason.
Social entrepreneurship is the cream of the crop. It allows an individual to turn a profit while creating desperately needed jobs and solving a national or global issue.
Keep in mind that even a small handful of these businesses can make a serious impact on our world. We’ve already learned that we can’t rely on government to fix these big issues. And whether we like it or not, money talks.
"Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has."
- Margaret Mead
People Want To Support Your Mission
One of the coolest aspects of starting a for-benefit business is all of the help you’ll have access to. People inherently want to support businesses that do good in the world.
Customers, investors, donations, and volunteers can play a huge role in helping your venture get off the ground, and they’re likely to show up when it’s clear that you are creating something great.
Another benefit is free press. While traditional businesses might struggle to get much in the way of media coverage, there is a special place for a feel good story with journalists and media websites.
There Is Purpose In Social Entrepreneurship
At our core we are just humans who are looking for a way to matter in this world. On the road to happiness, purpose matters more than money.
When you start a business that tackles a problem that is important to you personally, you gain a sense of direction in your life and the self respect that comes with knowing you created something bigger than yourself.
“You never change things by fighting the existing reality.
To change something, build a new model that makes the existing model obsolete.”
― R. Buckminster Fuller
To Profit Or Not To Profit?
A social entrepreneur is one whose business foundation is based on solving a social problem, typically in regards to people, animals, or the environment. It’s structure can be nonprofit, for profit, or a hybrid of both of these.
While each has its merits and drawbacks, I am especially drawn to for profit social businesses. (And no, it’s not because I’m a greedy capitalist who loves to cut down trees and make hippies cry.)
In some ways, non profit organizations are wonderful. They tend to stick to their mission easily as any funds after basic expenses go directly to the cause they support. They are also eligible for public and private grants, and receive tax exemptions from the government, which puts more money towards their mission.
Here’s why I prefer the idea of for profit social businesses. When you are first starting out, you’re going to be very small on the overall scale. You will probably be a one woman show, hustling to get your business off the ground. As all business goes, you will need money to succeed- and there are typically two ways to make it.
A nonprofit looks for investors and donations to jump start their work. A for profit business begins by doing the work. In most cases, it is much faster to start hustling rather than wait for investors to bang down your door.
A faster startup means you can start doing good sooner, and you can start applying some of your earnings towards your own financial independence. Of course, you can always switch to a nonprofit framework down the road if it makes the most sense for your business.
How to Never Have to Work Again (Yes, Really)
The Financial Independence Road Map will show you how to use your business to drive simple investments and never have to work again.
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How To Start Your Own Micro Business In 5 Minutes
If you don’t have a business idea in mind yet and you want to get started right away, consider micro lending! Kiva was founded in 2005 and is a non profit organization that crowdfunds to provide small loans to low income entrepreneurs all around the world.
Due to currency exchange, small amounts of western dollars can jump start a business in a third world country where jobs are scarce and education is low.
Your funds go towards the supplies and overhead needed to launch a business that supports a family in various parts of the world. On top of that, it is expected that your loan will be repaid with interest as the borrower begins making an income.
Kiva boasts a steady 96.9% repayment rate and allows you to view the profiles of those who would benefit from your micro loan. If you’re looking for a great way to get started, this is it!
Tips For Launching Your Socially Conscious Business
Tip #1: Define Your Mission
Whether you decide to form a for-profit or nonprofit organization, the most important step is to define your mission. Who are you trying to help and how? What are your goals for the first several years?
When you’re deciding who you want to help and how, make sure you do enough research to ensure that your efforts will be helpful. Many would-be do gooders misunderstand the cause of the problem they are trying to aid, and end up sometimes causing more harm than good.
I’ll give you an example- Tom’s shoes.
Now I don’t mean to pick on Tom’s, and I really believe the company had excellent intentions when they started their Buy A Pair Give A Pair program, but their example is the best one that comes to mind.
Many experts argue that such a large influx of free shoes stunted the textiles industries in some of these heavily donated to areas, furthering the demise of businesses, and thus, jobs.
Similar issues have been noted in many African countries, where free western clothing pours in by the truck full. Local businesses can’t compete with free, so they end up shutting down completely.
Of course, everyone needs shoes and clothing to maintain a reasonable quality of life. I'm no economist, but one solution might be to use that aid to prop up local family businesses in the area instead. This would give families more money to spend, which would in turn continue the cycle of families supporting other small businesses in their town.
So the lesson learned here is to do your research, know the cause of the problem you are aiding, and then dive in!
“Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”
Tip #2: Set Specific And Measurable Goals
Setting goals is a critical part of getting started with a socially conscious business. Your goals are the ‘why’ behind your business, so you better know what they are!
One of the best ways to determine exactly what your mission and goals are is to develop a 15 second elevator pitch.
Not sure how to do that? Here's a quick elevator pitch framework to get you started.
“We help/teach/provide X by doing Y”
We help reduce ocean plastics by recycling them into sunglasses.
We provide extracurricular activities to disadvantaged youth by setting up fun and engaging after school classes on school grounds.
Most people tend to overestimate what they can accomplish in one year, but massively underestimate what they can accomplish in 5 years. Keep this in mind when you set your goals.
Tip #3: Crowdfund To Gain Startup Capital
Some business ideas will require more time than money in order to get started. If that’s your case, you can likely skip this step.
Most social entrepreneur ventures, however, will require some startup capital. Crowdfunding is a great way to gather your funds, get people engaged, and spread awareness of your cause.
Tip #4: Leverage Your Content
It won’t be enough to just set up a crowdfunding page and hope swarms of people will donate to your cause. You will need to produce great content, and lots of it to spread the word.
Video is one of the best ways to reach people in an authentic way. Video footage of the problem you are trying to solve is one of the best ways to get others to rally for your cause.
Using your social media platforms to share content related to your venture is also important. In an age where just about every person and their dog has at least one social media account, getting people to share your mission and support you through it will be critical.
Don’t give up! This stage may seem to progress slowly at first. Photos and video will go a long way towards reaching new people. If you can, experiment with some paid ads as well.
Tip #5: Get Some Publicity
My last tip for getting your socially conscious venture off the ground is to search out publicity, and do it often. Writers love a unique and feel-good story. Put together a media kit for more official publications such as newspapers and magazines.
Then, start emailing blogs in your industry who may be interested in featuring you. I recommend setting up a quick Excel spreadsheet where you record who you contacted, the date, if/what their response was, what you need to deliver, and a due date.
Remember, PR isn’t something where you try one day and then never again. It is an ongoing process of searching out new avenues and contacting lots of people. Set yourself up with a day every week or two dedicated to PR. It will pay off in the long run.
If you’ve decided to become a social entrepreneur, my hat is off to you! If I can convince even a few dozen people to work within a socially conscious framework, I believe the results we see could be huge.
The truth is that we simply can’t rely on governments to take the initiative in solving national and global issues. For the most part they have neither the resources nor the incentive to do so, and such large entities tend to be bureaucratically slow and inefficient. It is up to us as individuals to create the change we wish to see.
“Change will not come if we wait for some other person, or if we wait for some other time. We are the ones we’ve been waiting for. We are the change that we seek.”