Six Ways To Approach Social Entrepreneurship At Your Organization

This article was previously published on https://www.forbes.com/sites/forbesbusinesscouncil/2021/01/28/six-ways-to-approach-social-entrepreneurship-at-your-organization/?sh=5d020f891810

As a business owner, you strive to deliver products and services to improve lives and hopefully make a profit. In the social entrepreneurship world, regardless of whether the business model is nonprofit or for-profit, social entrepreneurs like yourself are inspired to think about innovative ideas to solve the world’s most pressing problems.  

There are two sides to this equation. Funders like to see nonprofits with diverse revenue streams, including self-sustaining income. With this preference, nonprofits who traditionally just focused on community work must now consider revenue-generating activities.

On the other side, businesses traditionally focused on profit-making activities are attempting to do good through community outreach. This is not only good for the community but good for business. Defined as corporate social responsibility, it gives businesses the ability to appeal to customers’ shared ideals, advance their brands and lower tax burden.

Now, both nonprofits and businesses’ activities are invested in changing lives, giving back and advancing communities. Somewhere between business and giving back lies social entrepreneurship. Social entrepreneurship is an approach taken by various individuals and groups in which solutions to social, cultural or environmental issues are developed and funded. The metrics for success are often found in how many lives saved, children educated or homes built. Social impact work is often integrated into day-to-day activities and business decisions.

There are many organizations doing great things. Here are a few and lessons from each you can take to apply within your own organization. 

Newman’s Own 

Since 1982, as detailed on their website, Newman’s Own, has donated all profits to non profit organizations with more than $550 million distributed worldwide as of 2019. Their approach requires covering normal business operation expenses before sending all profits and royalties to nonprofits through their own 501(c)(3). Could this be a sustainable business model for a new business just starting out? Maybe not, but if you have an established business and have already worked out the kinks of establishing predictable operating expenses, a well-defined brand and smooth-running internal operations, this can be an excellent option for making an impact. 

Bombas

Bombas is another company operating from social entrepreneurship principles. They utilize their company’s focus on a particular item — socks — to raise awareness around an under-publicized problem in the United States: homelessness.

Many business leaders new to social entrepreneurship may struggle with focusing on a single, multiple or general issue approach. Bombas’ approach shows that no matter your choice, it all comes down to strategy. Their one issue approach works because what they sell — socks — aligns well with who they help — people currently experiencing homelessness. You may find your own company’s product offers utility beyond a revenue stream as a focus of your social entrepreneurship.

Kendra Scott

Kendra Scott has a multi-faceted approach to giving back. Three of the flagship ways stand out: the Giveback suite, donating products and hosting Give Back events. The Giveback suite offers consumers options to buy specially designed pieces that benefit specific causes. They also open the door for consumers to donate products to raise money for a charity of the shopper’s choice. Lastly, they have an arm in events where 20% of event proceeds benefit a charity of the shopper’s choice. 

Kendra Scott’s flexibility in how they give back really sets them apart. For social entrepreneurs in the early stages of launching their companies, having various giving give-back options is key — especially options tied to products where you can give back as you grow. Flexibility allows for incremental giving that won’t overwhelm your organization when revenue fluctuates.

Shea Moisture 

SheaMoisture invests proceeds from every purchase into educational and entrepreneurial programs formed in communities from the U.S. to Africa. In 2020, Shea Moisture announced a $1 million fund to support entrepreneurs of color and small businesses, driven by its long-established Community Commerce business model.

This approach best appeals to business leaders interested in pursuing social entrepreneurship business models that directly reinvest in communities locally and abroad. It offers leaders an opportunity to give back through a practice they know well — entrepreneurship.

Warby Parker

Warby Parker has donated over seven million pairs of glasses through their social entrepreneurship program. They saw a need for glasses across the globe and similar to Bombas, rely on their product focus to help fuel their efforts. To reach globally, they work with a handful of partners to ensure that when glasses are purchased, glasses are donated, too. 

Their focus also includes empowering community members to recognize the need for glasses. All of this appeals to Warby Parker’s ultimate goal as a business — improved vision. Infusing workforce training, improving access to services through affordable pricing, and providing donations can help business leaders think about how to instill social entrepreneurship throughout each level of the distribution continuum. 

Toms

Toms is a B-Corp, representing the highest standards of social and environmental performance, transparency and accountability. Toms purports that for every $3 they make, they give $1 away.

They claim originality as a one-for-one company, having given almost 100 million shoes worldwide. With over a decade in business, they’ve made sure to reassess their social entrepreneurship efforts. They’ve recently announced the dedication of at least one-third of the net annual profits to a giving fund managed by a team. 

I’m sure these decisions were not made in a vacuum and a change in focus shows that gaining feedback on a regular basis is important to maximizing social entrepreneurship and is an exercise all leaders should consider adopting. Even if you start with one focus, as Toms did, there is room to change as your company grows to ensure your impact grows, too.

These six companies demonstrate business models that earn profits and do good in the community. They also offer businesses of any size tangible ways to participate in social entrepreneurship. Leaders should make time to ask themselves and their team members which aspects of these business models most resonate when it comes to advancing social entrepreneurship. 

- Shavonn

Shavonn Richardson, MBA, GPC is Founder and CEO of Think and Ink Grant Consulting?. She is a grant professional, an active speaker, and serves on the Board of Directors for the Grant Professionals Association.

Shavonn earned a BBA from Howard University and an MBA from Emory University. She earned the GPC (Grant Professional Certified) credential from the Grant Professionals Certification Institute in 2020.

Learn more at www.thinkandinkgrants.com