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This article provides guidance for small business owners on how to develop a compelling customer experience.
Joanna is the founder of merl, a consultancy supporting civil society organisations to achieve their social justice missions.
In Good Company, co-founded by Hatch graduate Alex Birtles, has launched the Good Report, a study into impact led businesses.
However, social entrepreneurs have to overcome tremendous challenges:
FundingSocial enterprises are neither conventual commercial ventures nor charities – they sit somewhere in the middle of the chart. Ideally, this can mean that they can receive income from both trading and donors or social financing – most successful social enterprises do. On the flipside, for many others, it can be very difficult to receive either of them. Generating enough revenue from the sale of social goods or services is not always easy, while a lot of donors or institutions are wary of giving funds to organisations they deem to commercial – many social enterprises that are not run as strictly non-profit entities can fall under this label. Government programmes are slowly waking up to the opportunity of social entrepreneurship, and some initiatives can be eligible for public funding or government grants, but developments are happening only slowly. The opposite problem arises for many social entrepreneurs who are trying to get corporate investors on board. Here they face the stigma of social institutions not being able to offer a sufficient return on investment – even though 75% of social enterprises are managing to generate a profit, standing at just about the same rate as other SMEs (78%).
Check the article THE INCONVENIENT TRUTH ABOUT SOCIAL INVESTMENT
Lack of Networks and Business skillsFrequently, social entrepreneurs have a very different background from founders of traditional businesses. They often did not go to business schools and neither did many of their peers growing up. Their different experiences can represent a huge advantage, both for them as well as society, but it also means they are underprepared for some of the challenges of entrepreneurship. And without a network of acquaintances who are knowledgeable in the field, there are not many places of help and support available. Like many SMEs starting off, social enterprises additionally have problems accessing sale channels and finding customers for their products. Making the world and your prospective clients aware of yourself is everything but easy on the very limited budget most of them have. As a result, the internet becomes a powerful and in some cases indispensable tool for them – the cost of access is negligible, and with the creativity and resourcefulness a lot of social entrepreneurs possess, they’re often able to make their name heard with clever marketing and appealing products. Like our friends at Snact or the people behind Beam, a mission-driven business in London specializes in helping ex-rough sleepers into employment by helping them crowdfund their way back to work!
”They often did not go to business schools and neither did many of their peers growing up
Their different experiences can represent a huge advantage, both for them as well as society,
but it also means they are underprepared for some of the challenges of entrepreneurship.”Another strategy employed by many is to look to a local community. What almost seems like a throwback to times long gone by, they simply go out and talk to people personally to build awareness and a base of loyal customers and supporters. That’s what Rebecca Trevelyan and her friends did when setting up the Library of Things in South London. The principle behind the initiative is simple: Instead of borrowing books like you would from a normal library, the Library of Things allows you to borrow tools and devices you might need once every few months but are quite expensive to buy and own. In the weeks leading up their launch, the young entrepreneurs simply went from house to house, knocking on people’s doors, telling them their stories and asking them whether they maybe had some unused tools they could donate. When the opening date arrived, people came by the dozens, both as lenders and donators. Unfortunately, however, stories like this, showing the potential of social entrepreneurs are still more of an exception than the norm. For many of them, the lack of business expertise and networks is simply too much to overcome.