Twelve Tips For The Budding Social Entrepreneur
You have a great idea to save the world. How do you launch or grow a non-profit or for-profit social enterprise?
You are a budding social entrepreneur (whether you know it or not). Here are my two cents on how to avoid the biggest pitfalls and grow your organization in the right direction...
1. If your great idea is a new shiny product, it’s probably not a great idea - focus on what problem you want to punch and what your customers actually need
I apologize to all the solar lantern designers out there, but I don’t believe we need yet another new solar lantern, even though some 2.7 billion people live without access to clean energy across the world.
What I mean by this is that if you should focus on the problem, not the solution or technology:
How would you get these lanterns into the hands of the people who need them?
How are these lanterns affordable to those who need them?
How do you create distribution systems to reach them, ideally employing local entrepreneurs themselves?
Or better: are there existing low cost local technologies (I bet you there are) and how do you support those that produce them, rather than bringing in a shiny new lantern manufactured in the USA or China to Africa?
Or even better: should it even be a lantern vs. an off-grid solar systems to power entire villages and communities or another solution? You would never light your house with a bunch of candles, and yes candles are better than nothing if you don’t have any power, but solar lanterns are not good enough in terms of solving the actual problem long term.
2. Design your exit strategy from the outset
Working in a community for 30 years is not a good thing - it means that they - and in fact you - have become dependent on your help. It’s more than likely anyway that you’ll not be there in 30 years, that you’ll only be there in fact for 1-5 years, given your funding may dry up.
So what happens when you leave? Does your good work continue without you or even better, expand and take on a life of its own through local entrepreneurs? If your idea is a product of some kind (a tractor, a well, a lantern, etc) - what happens when it breaks down?
One of my favorite quotes that Victor Hugo uses in Les Misérables:
“The road to hell is paved with good intentions.”
The hell of international aid is filled with solar lanterns, play pumps and baby warmers left on shelves unsold, or in fields broken down.
3. Don’t take a post-colonialist attitude - please
Related to this, don’t assume that because you are bright, well-educated, and have some momentum, you know better than the people you are trying to help, whether that’s in the US or across the world. This should be soooooooo obvious and yet I still often see this. The word ‘beneficiary’ should be banned from our language, as well as the word ‘empower’.
If you’re reading this, it’s more than likely that you’re an outsider from the community you’re trying to help - even if you’re from that country.
That does not mean you should not help. On the contrary, people with the means (almost any means) morally should, in my view. But do so with deep understanding, empathy, listening, and co-design with your customers.
4. Actually, assume you really know almost nothing
Start with your customer (not ‘beneficiary’). Understand what they really need. Think through the unintended consequences of your work. Design your work with them. Does it actually go to solving the real problem? Its root causes? How can you exit?
5. Quick iteration and failure is part of the process
Ann Mei Chang’s book Lean Impact adapts the very successful Lean Startup concept to the social impact field - essentially fail fast, iterate often, create as quickly as possible a minimal viable product and test and re-test it with your customers. I like the concept a lot - especially when you contrast it to a typical project which may last 3-5 years and you only know if it works when you do the evaluation at the end (and then you realize you did not do a good baseline).
6. Measure the right things: your outcomes and your agency towards them
I could write a 10 part series on the need for better metrics in social impact. Often when people do not know what to measure, or when they have too many or bad metrics, it’s less to do with measurement and more with a bad strategy, or what, in development, we call ‘theory of change’. Two key pieces of advice here:
Do a baseline with a control group. If you don’t know where you’ve started from, and you don’t have a control group, you can’t see the impact you’ve had, and you can’t really know what might have happened without your agency. You can’t go back in time to do a baseline after the fact so it’s key to not forget that as the first step. A good controversy on this to read up would be Jeff Sach’s Millennium Villages.
Design your Monitoring and Evaluation strategy from the very beginning so that the costs and measurement is integrated into the project, not an ad hoc.
7. Money is still king (unfortunately)
As a social entrepreneur, you almost never have a secure or recurrent source of funding (unless you have an endowment but then again that is subject to market variations) and usually have to be applying continually for new grants or investments, securing new customers or sponsors. That may not be that different to being an entrepreneur in general, I guess.
In social impact, new accelerators, impact investors, grant-making organizations are entering the space every day so it’s worth always being on the lookout for these new players on top of the traditional ones. This is valid also for social impact professionals in general.
For sure, it’s frustrating to feel like you’re always chasing the money when you all want is to do good.
I get frustrated myself as I would love to spend more time with the social entrepreneurs we support but the truth is as Executive Director, I have a budget – revenue and expenses. And the expenses only happen when I fill the revenue column, much to my chagrin...
And who has and controls the money to give or invest is yet another story, one that will require a dedicated post – when you are trying to change the system, at the end of the day, you will have to accept to take money from organizations and individuals that have profited from the system you are trying to change. That might feel uncomfortable, and you will have to choose where your red line is, but more on that in another post!
8. Apply for all the relevant fellowships, prizes, and awards for which you qualify
It’s always hardest to get your first foot in the door, and to secure your first $10,000 or $100,000. Given the sector is not transparent in terms of funding opportunities, getting your organization’s name out there is important. There are a number of good fellowships, prizes, and awards that not only can help you do this — these can also often provide grants (for your salary or your own leadership skills).
But the true value of these will often be mentorship and the access to a great network.
Solve has brokered over $25 million and counting in funding for our Solver teams and entrepreneurs all around the world. But we also provide coaching, mentorship, and other in-kind resources to the Solver teams as part of a 9-month Solver program based on their initial stated needs. And we find Solver team report that the network we introduce them to, and the peer-to-peer networking and support is one of the most valuable parts of the program.
9. Surround yourself with brilliant people — on your board, in your organization, and in your network
When you start, you have no real processes or systems — the success of your organization rests entirely on the people who make it up. They need to be super motivated and work all hours for little money, and many partnerships and early employees may not survive the initial strains.
You should also hire people who know a great deal more than you do in all your areas of weakness — maybe that’s sales, fundraising, IT, finance, or operations.
You’ll end up doing a lot, don’t put yourself in the position of doing it all because you’re the best. This may also mean that it’s a false economy to pay people very poorly even if you’re just starting out. A brilliant director of development will make all the difference (providing they are indeed brilliant).
A great board will also help you secure funding, mentor you and help connect you with other organizations. You should aim for the most senior board you can get, providing they do have some time to devote to your enterprise.
10. If you are student, start now and use the liberty and time you have now to really get things started
Everyone says that you’ll never get your student years back — indeed you probably won’t. It’s an incredible time to learn, develop, party and hopefully figure out a little bit about who you are. You may very well have more time to dedicate to your ventures, you’ll meet potential great partners as you’ll be concentrated with like-minded people, and there are a great number of funds, fellowships and accelerators out there specifically for students.
Maybe your university has one — for example, MIT hosts a great number of entrepreneur-related courses and competitions – MIT IDEAS, the MIT 100k competition, and more. They may or may not be devoted to social entrepreneurship per se, but I say go ahead and make them about social entrepreneurship!
11. If you are working full-time, don’t quit until you’re really ready, but commit at least 10 percent a week to your venture
It’s very risky and expensive to quit your job until you’re sure your idea is sustainable enough to both cover a salary for you and more importantly grow towards impact, and I would not recommend devoting yourself full-time to an enterprise until you know it has at least some good legs. If you’re not working 100 hours a week in investment banking, law or consulting, there should realistically be at least one day a week (Saturday or Sunday) you can devote to your venture and you should if you really want to get this off the ground. Or even better, think of it as a newborn child (well, yes, that is harder if you do have a newborn child) that you come home to every night.
Patrick McGinnis wrote a book a few years ago “The 10% Entrepreneur” that looks at great example of people who started companies on the side, and for me, that applies to social entrepreneurship too.
12. No one is going to make your idea a success but you, but lean on all those you can
In social impact, there is no obvious career path or route to success. The good news is there are many.
The trick is that you — and only you — are going to make this happen.
So for a social entrepreneur, it probably means networking like crazy, working all hours, traveling too much, failing a bunch, staying the course, and not forgetting your mission.
It’s not for everyone, and it’s not easy, and I myself am not doing it alone as a social entrepreneur but did so with the full backing of MIT, but I greatly admire, commend and support all of you who are setting out along this path. Best of luck, and go change our world for the better!
