What the h*** is Social Enterprise?
Did you know there is no universal definition for a social enterprise or that a social enterprise is not a legal structure but a business model?
Confused? Don’t worry, you’re not alone.
I’ve been working with and in social enterprises for 6 years and the conversation I still have almost weekly is “what even is a social enterprise, and what isn’t?!”
These myths are holding back the good business movement
Without clarity on the social enterprise business model, people are falling at the first hurdle in making an impact through their business. We are seeing more social enterprises being set up who won’t ever stand a chance of being sustainable and too many good ideas not coming to fruition, as they don’t have the clarity and confidence they need.
Our world needs change-makers, purpose-driven people and innovative entrepreneurs now more than ever. So what can we do to bring some clarity to the conversation?
You gotta start at the source. What is the problem?
Why is it so confusing?
No universal definition
The fundamental reason it’s so confusing is that there’s no universal definition. So if you’re talking to two people about social enterprise, they might have different pictures in mind of what you’re talking about. So if you find yourself in conversations that aren’t aligned to ones you’ve had before, this is why.
Confusion around legal structure
It’s also not clear that social enterprise isn’t a legal structure, but a business model. This brings about lots of confusion when selecting a legal form, and so many get stopped in their tracks or select a legal structure without knowing what to take into consideration. This isn’t just stressful at the start but can have a long term impact for the business.
Not come across enough good examples
A lot of people set up a social enterprise because they have come across one and been inspired to start something up similar. This is a great starting point but what happens is they will try and replicate the model for a different beneficiary group or product and it might not be the right fit. By coming across more examples, in all their shapes and sizes, it might give entrepreneurs more of an opportunity to design a model that works for their unique offer.
Inaccurate ideas around funding
The perception when it comes to social enterprises is that you can access funding, which traditional businesses can’t, which is considered as “free, easy money”. This message is falsely guiding people who would be better suited to setup a charity, to choosing social enterprise models and many potential social enterprises defining themselves as ‘purpose-led business’, or ‘businesses for good’ because they want to be seen as more innovative, and financially sustainable.
Webinar Series to Debunk the Myths
I am passionate about seeing more good businesses being setup that are future-proof and self-sustaining so teamed up with Social Enterprise Mark CIC, to host a series of webinars to debunk the myths around Social Enterprise.
We explore:
what you need to know when defining them,
share the different legal structures you can set up a social enterprise under and what to take into consideration,
showcase different impact models and their relationship with financing the business,
and close with a session on the challenges around funding a social enterprise and tips on how to sustain your business on traded income.
We invited social enterprises to join us to bring practical experience into the conversation, so we aren’t just looking at the theory. They share their experiences, warts and all, and impart tips and lessons learned to support others getting their head around this business model.
Want free access to these sessions? Find out more here.
