Looking at Social Enterprises with a Business Lens
The term “social enterprise” applies to a variety of legal entities, ranging from community interest companies to co-ops. If you are curious to explore the possibility of creating a social enterprise under your nonprofit, our first tip is to look at social enterprise ideas through a business lens rather than through a purely nonprofit lens.
Through reaching out to nonprofits in Canada, Scotland, and nationwide, we realized that a nonprofit’s mission and business operation do not need to be mutually exclusive. While reaching out to Snowday, a New York food truck selling maple-based products, we were told that raising initial capital was crucial to making a profit. We also learned that their buyers were more likely to pay double the price of the food because Snowday’s mission resonated with them. While Snowday’s plan adheres to a business model, what makes them successful is their mission of helping formerly incarcerated youth gain workforce skills.
On the other coast, Downtown Women’s Center in LA emphasizes the need for a strong accounting plan for the success of a social enterprise. When running programs, a solid accounting plan provides assurance for the mission’s longevity. When programming for formerly homeless women runs higher costs than expected, the LA office looks also for private dollars and donations from individuals who have become part of the Downtown Women’s Center Community. Artists, friends, and staff all volunteer time to ensure programs continue to thrive. Another enterprise, Isidore Recycling, makes a considerable profit, but has worked to make sure formerly homeless can turn to their enterprise for a chance at a job. They also recommended B Corporation certification as a must-have for all social enterprises.
A social enterprise has no definite qualities, but interviewing other enterprises around the country has affirmed that having a dedicated mission for helping others and a strong business plan bring multidimensional benefits for all of those involved.