The world is far from perfect, and while so many of us are quick to point fingers, few follow their accusations with actions. The social entrepreneur provides an exception to that rule.
Using a for-profit model that has shown as functional in today’s economy, this form of entrepreneur actively seeks to improve social conditions, address the areas of need in our world, and do it all in a manner that actually gets things done. If you’re ready to join the ranks of social entrepreneurs, you may be raising one important question:
How can I fund my efforts?
Stage One: The Business Plan
First, however, the social entrepreneur must show that their business concept is sustainable, responsible, and — most importantly —actionable. You must be able to convince your audience (investor, funding organization, or resource group) that your plan can actually work.
The business plan is your way of showcasing your organizational abilities, clearly defining your goals and your approach, setting a timeline, and tallying necessary resources. It also shows that you have carefully considered your needs and impact, which in and of itself is highly meaningful in the world of social entrepreneurship.
Stage Two: Show Your Capabilities
Using whatever bootstrapped funding you have available, or whatever initial investments you can acquire, to show that your approach can work. Whether this is building product prototypes, participating actively in the community, or generating early stir about your company, showing that you’re capable of handling money — and evoking a response — will make a significant impact on investor relations. Even in the socially responsible world, business comes down to figures and traceable facts, so get as many together as you can.
Stage Three: Apply for Resources
There are three types of resources you may qualify for. They are, in order of typical priority, grants, loans, and direct resource contributions.
Grants typically come from major foundations that have a highly specialized niche. Your first step here, then, will be researching which organizations are appropriate for you. Try to find groups that closely match your own company resources, and apply for these “free money” contributions to get your projects started.
Whether or not you receive grants, you may be able to qualify for loans. While these loans will require repayment, interest rates are generally kept low, and are sometimes charged only to cover the cost of operations. Again, different loan organizations have different areas of focus, so do thorough research prior to commencement.
Step Four: Resource Contributions
And lastly, once you’re ready to launch, look into direct resource contributions. These groups provide everything from educational resources to business consulting to training materials to free promotion and more. While it’s not enough on its own to get you off the ground, it can certainly amplify the success of your business.
The good news is that a number of organizations exist to help social entrepreneurs get off the ground. Some of these organizations provide resources, pro bono services, and even seed funding. Check out this list of social entrepreneur funding for more information.
Each of these stages is difficult and complex, but they provide advantages even beyond resources. To get through this process, you must know your capabilities, plan, and even your intentions thoroughly — preparing you for the difficult but rewarding path of the social entrepreneur.