Generation Z is supporting social causes at an increasing rate. More than 76% are concerned about humanities impact on the world and 60% want their occupation to impact the world. With society gradually becoming more focused on social good, entering the world of social entrepreneurship can be tempting.
As this field is a bit younger and more complicated than typical entrepreneurship, it can be hard to figure out where to begin. How do you balance profits and social impact? Is it more important to sell a product or influence the world? How do you attract the best talent? No matter what impact you are looking to leave, these are important questions with difficult answers.
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I sought out an experienced social entrepreneur to talk about these dilemmas and gain insight on how you can actually go about building a social enterprise and impacting the world, while growing a company. Aristole Loumis is the founder of Ellison Eyewear (@wearellison), an eyewear company that helps build homes around the world and offer sight to impoverished communities.
After talking to him about how he became the fastest funded equity crowdfunded campaign, raising $125k from investors from all over the world, this is what he advises for all aspiring social entrepreneurs.
1. Focus on the money
One of the first things Loumis noted was the critical need to never forget money. Social enterprises are ultimately businesses and need money in order to be successful. Ellison uses their profits to fund their social impact, so without strong profit margins, they would never have built the 40+ buildings that they did and promote sight-providing projects in the developing world.
Too frequently, founders get caught up in the social impact and either price their margins too low or too high. It is naïve to think a social enterprise should not make money, but it is worse to think consumers will pay a fortune for a product or service merely because of “social good.”
From the beginning, you should approach your enterprise like a venture and aim to generate a product or service that people are willing pay for. Then ensure your costs are low enough to leave room for your social impact missions.
2. Share a story
Ellison has focused on minimizing the costs of running his business and one of the ways he has done so is by minimizing his marketing budget. While traditional marketing routes can be costly and not profitable, he found word-of-mouth is often more effective and much cheaper.
In order to leverage word-of-mouth marketing effectively it is crucial to maintain a coherent and strong story for the company. Ellison has a straightforward narrative of being a better glasses company that helps impoverished communities.
Tying in user-generated content can help you forward this narrative and help curate a community behind the story. Create company initiatives to help encourage consumers to posts pictures of the company on social media.
Whenever you see quality images from users, make sure to share them on the company accounts to help demonstrate there is a mass following for this social enterprise and that the impact is real.
3. Think long-term
Often times social enterprises can focus too much on the short-term and ignore the long-term growth vision. As Loumis notes, “worldwide impact does not come from one donation; it relies on a constant stream of support.”
Do not think just about your first social impact project or how you can get some short run support for the project. This initial planning and support is crucial, but if it cannot be sustained for a long period of time, the venture will fail.
When you start out on planning your social venture, layout a series of milestones you need to reach and coordinate them into a long-term growth vision. Try to have each milestone build upon the past ones.
This might include starting with a series of small impact projects that build up a community that can then later launch a large-scale project. Overall, understand how your organization will growth with time and never let yourself reach a position where you do not have enough momentum or resources to move forward.
For those who are interested in entrepreneurship but want to have a more tangible impact of the world, social entrepreneurship can be the perfect answer. These ventures can balance the fulfillment of being self-employed and growing an organization with the rewarding work of helping others.
Since this type of business is different than other startups, social enterprise founders need to think differently than typical founders, but never lose forget they are still businesses. If done properly, a social enterprise can have the fame, success, and impact of ventures such as TOMS Shoes or (RED).