How do you design and test your social business model and value proposition?

1 Lean canvas

One of the most popular tools for designing and testing your social business model is the lean canvas. The lean canvas is a one-page template that helps you map out the key elements of your business, such as your problem, solution, customer segments, channels, revenue streams, cost structure, and key metrics. The lean canvas also includes two boxes for your social impact: the unfair advantage and the social mission. The unfair advantage is what makes your solution unique and hard to copy, while the social mission is what defines your purpose and vision. By using the lean canvas, you can quickly sketch out your hypotheses, test them with experiments, and iterate based on feedback.

2 Value proposition canvas

Another useful tool for designing and testing your social business model is the value proposition canvas. The value proposition canvas helps you understand how your solution fits the needs and wants of your customers and beneficiaries. The value proposition canvas consists of two parts: the customer profile and the value map. The customer profile describes the jobs, pains, and gains of your target segment, while the value map shows how your solution creates value by offering products, services, pain relievers, and gain creators. By using the value proposition canvas, you can align your solution with your customer segment, test your assumptions, and identify gaps and opportunities.

3 Social impact measurement

A third essential tool for designing and testing your social business model is social impact measurement. Social impact measurement is the process of assessing and communicating the effects of your solution on the social and environmental issues you aim to address. Social impact measurement can help you improve your performance, demonstrate your accountability, and attract support and funding. There are different frameworks and methods for measuring social impact, such as the theory of change, the logic model, the social return on investment, and the impact management project. By using social impact measurement, you can define your goals, indicators, and data sources, collect and analyze evidence, and report and learn from your outcomes.

4 Prototyping and piloting

A fourth important tool for designing and testing your social business model is prototyping and piloting. Prototyping and piloting are ways of creating and testing low-cost versions of your solution before launching it at scale. Prototyping and piloting can help you reduce risks, learn from mistakes, and gain feedback from your customers and beneficiaries. There are different types of prototypes and pilots, such as paper prototypes, mock-ups, minimum viable products, and small-scale trials. By using prototyping and piloting, you can experiment with different features, formats, and channels, and validate your value proposition and business model.

5 Customer discovery and validation

A fifth essential tool for designing and testing your social business model is customer discovery and validation. Customer discovery and validation are stages of the lean startup method that help you find and confirm your target market and product-market fit. Customer discovery involves talking to potential customers and beneficiaries to understand their problems, needs, and preferences. Customer validation involves testing your solution with real customers and beneficiaries to see if they are willing to pay or use it. By using customer discovery and validation, you can avoid building something that nobody wants, and focus on creating value for your customers and beneficiaries.

6 Learning loop

A sixth crucial tool for designing and testing your social business model is the learning loop. The learning loop is a cycle of building, measuring, and learning that helps you iterate and improve your solution based on evidence and feedback. The learning loop involves setting a hypothesis, designing an experiment, collecting data, analyzing results, and drawing conclusions. By using the learning loop, you can test your assumptions, measure your progress, and learn from your failures and successes.