Social Entrepreneurship Guidebook Introduction to the guidebook Welcome to Changing the World! This is a young person’s guide to Social Entrepreneurship. Congratulations! It takes a lot to get to this point and we hope this guide will support you in the next stages of setting up a social venture.
How to use the guide
The way to get the most out of this guide is to consider all questions out honestly, and to stretch your imagination when it comes to exploring ideas. It will be important to immerse yourself in the activities to expand your thinking no matter how ridiculous or random they may seem. It may not be obvious at first, but the activities in these pages are designed to stimulate creative thinking, help you see patterns where there is chaos and to be an even better problem solver. The guide is made up of different sections focusing on different aspects of setting up a social venture. You can work through it in order or pick and choose which section appeals as most helpful. We encourage you to write down ideas, to-do lists, doodles and reflections throughout the guide to capture your thinking along the way.
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What is a Social Enterprise? There are countless definitions for a Social Entrepreneur and/or Social Enterprise. In fact, a quick Google search will reveal well over 50 definitions for social entrepreneurship only. With this in mind and before we start looking at some examples, remember not to get too caught up in definitions and labels. What is most important is having an idea, and the will to put it into action. Here is a simple formula to get started: Interest/Passion + Trying to solve a social problem + making a profit and reinvesting it = Social Entrepreneurship
Who is a Social Entrepreneur? UnLtd says: A social entrepreneur is a person with the determination and commitment to use their energies to make the world a better place. Wikipedia says: Social entrepreneurship is the process of pursuing innovative solutions to social problems. Schwab Foundation says: Social Entrepreneurs cannot sit back and wait for change to happen – they are the change drivers.
The first mission of entrepreneurship - YOU Some people say life is complicated and helping to change the world to a better, more balanced place is almost impossible. Like anything in life it depends how we look at things. Life can be complicated or incredibly simple.
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Where do you sit? If you see hope and possibility for change it is quite possible you have the spark needed to make a positive difference in the world, whether it is within your neighbourhood, across your country or even in a virtual community. As one might expect this doesn’t happen overnight, however it almost always starts off with one person, an idea. Each person is motivated by their experience as well as their unique nature, and will understand that it is not about being right or wrong, but rather utilising their strengths for the benefit of others. The opposite of sharing in this way is exploitation- taking away something with a detrimental effect. Every day there are examples of someone or something exploiting others, exploiting living things, exploiting groups, communities or even societies. You are reading this guide for a reason; something has lead you to want to change something, perhaps someone or something is being exploited? Something does not sit right with you and you want to make it better.
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THE MOST IMPORTANT QUESTIONS YOU HAVE TO ASK YOURSELF BEFORE YOU START: 1. What is the problem - how to overcome it? What practical changes are you going to implement? How? What means will you use to address the problem at its source?
Keep the more important in your mind: In order to define the problem that you have decided to respond to, try to:
Define this problem: What is the social need and what is the target? Estimate the number of people involved by selecting the most important numbers in relation to the solution that you are bringing. Explain the causes: Why does this problem exist? Quantify and qualify the cost for society if it does not treat this problem.
Once the social problem is identified, the challenge is to succeed in defining a longterm vision and the path to get there. By setting the course, you prioritize more easily the actions you have to undertake. With day-to-day pressures, it is often difficult to plan, but it is a key step to structure your project. To this end, one must: Clearly define, collectively if possible, your area of activity, your mission and your vision. Share this vision with your team and with the people close to your project: they will be your ambassadors.
Complete your logical framework The logical framework or logframe is also often called Theory of change. Just as if you were telling a story, the objective is to explain your overall vision of the way in which the change is going to take place. It is not only about presenting the social goal of your project, but also describing the link between your activities and your objectives. It is important, first, to consider your overall objective before defining your activities. By doing so, you can identify the potential obstacles and specify the factors that you can or cannot control.
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2. What is your added value You have to position yourself relative to the other actors in your area of intervention. The answer to this question is very closely linked to your theory of change that we have just seen in question 1.
What are the other existing solutions? Who are they led by? What are your strong key strengths? What are you doing that is truly unique? Where do you bring value differently?
Knowing the other actors in your sector better and considering the degree of satisfaction of the beneficiaries through their activities, products and existing services will facilitate understanding the unique character of your project.
Identify the existing solutions Look for the initiatives that are close to what you are doing. Place yourself in relation to these activities. Compare yourself to the other solutions How do you differentiate yourself? What is your competitive advantage? a) Lower costs b) Larger customer base c) Greater social impact
What changes are brought to society and the targeted groups by your action and that of other actors? How do you evaluate these changes? (e.g. by asking the beneficiaries when possible). How do you explain the differences?
Keep the most important in your mind It is by knowing all your assets that you will be most able to formulate a suitable response to the identified problem; to strengthen your proposal of added value; to expand your impact on society. Identify the strategic abilities and tangible or intangible resources (capital, major networks, etc.) that are indispensable to reach the objectives that you have set. Highlight what you are best equipped for compared to others –whether it is skills or resources, and particularly those intangibles, such as your knowledge, relationships and reputation. If you have the impression that you are lacking resources, tell yourself that the scarcity of resources can be a driver for innovation! 5 Disclaimer: The European Commission is not responsible for any uploaded or submitted content. The content expresses the views of its author(s) only. Project No 2017-1-BG01-KA105-035501
3. What is your strategy for development? You now know what problem you are responding to and what differentiates you from the other actors in the sector. Along with this enthusiasm, you can be greatly tempted to diversify your activities, seize opportunities and spread yourself over multiple developments.
Sometimes the best decision is to know how to say “no” to requests; especially to funders, saying no is sometimes the best decision to make.
Which activities should you keep, remove or develop? How do you make these decisions in order to stay consistent and carry out the vision you have defined? What should you develop beyond your core profession? What is your core business? What are you best at? What are you deeply passionate about?
All these questions allow you to stay focused and share your vision internally and externally.
Keep the most important in your mind In order to build a clear development strategy, you must: Identify your strengths: an effective self-evaluation of the organization is the primary success factor. This is particularly important when you change the scale, to the extent that the process involves substantial changes. Take advantage of what you do best and strengthen it. Prioritize development opportunities that correspond to your social mission and/or that have a real economic benefit which would then allow the funding of other activities. Delegate or give up what you do not know how to do (or not as well as others). Other useful information sources: ◆ The HedgeHog Concept, Good to Great, Jim Collins www.jimcollins.com ◆ Support to launch a social entreprise: http://socialimpact.eu ◆ Scaling social impact, Gregory Dees and Beth Battle Anderson (2004) ◆ Scaling Social Entreprises: The Case of ENVIE and ACTIF in France, INSEAD (2006) ◆ The Social Innovation Factory: www.socialeinnovatiefabriek.be/nl/english
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4. What is your economic model? Now that you know what you are doing, why and where you are going, we will address the issue of funding for your project.
How can you find long-term sources of funding that will strengthen your social mission? What economic model best reflects your strategy and your organization?
It is essential to match your capacity to mobilize resources with your social impact. When you generate income yourself, these profits are funds that you can allocate as you see fit. But, if you do not generate your own income, you will need to have a strong fundraising strategy that will enable you to be independent. This is why, when possible, try to diversify your funding sources as much as possible.
Keep the most important in your mind It is important to regularly challenge and experiment with the economic model to make sure you have the right one. Your organization can only have the social impact you want if the funding of your activities is ensured. Determine beneficiaries who are interested in funding your project directly. Often, with social purpose projects, people think that everything must be free for beneficiaries. However, even minimal financial participation can be a way to both empower the beneficiaries and give them their dignity back. In the pricing, one must therefore consider what the beneficiaries can pay and what they would be willing to pay. It is also possible to set up a differential pricing system according to the means of the targeted people. If the payment methods create an obstacle, think about different options:
Assign a credit, a microcredit or defer the payment Rent rather than give (leasing systems) Imagine a system of differential pricing Identify those who are interested in what suits these beneficiaries best, and who are therefore interested in funding your project indirectly. Adapt the pace of the project’s development to the resources that you think you may be able to get. Think about developing a hybrid model to have access to different sources of funding coming, for example, from gifts, subsidies, and the sale of the delivery of services. 7 Disclaimer: The European Commission is not responsible for any uploaded or submitted content. The content expresses the views of its author(s) only. Project No 2017-1-BG01-KA105-035501
5. Measure your social influence Measuring social impact allows you to assess and validate the consistency of your actions committed to the mission of the project. Evaluating your impact will be essential for you to persuade your partners over the long term of the merits of your action, to be accountable to your investors, to improve your operations and the quality of the response you bring, and finally to guide your strategy.
How do you evaluate your social impact? What are the proper evaluation criteria? What is the method of evaluation suitable to your organization? What is impact on society?
Keep the most important in your mind There are many methods for evaluating impact. Whichever you choose, the relevance of the criteria and indicators that you define are the most important aspects. The qualitative and quantitative evaluation, contrary to accepted ideas, starts before the action. In order to be able to evaluate the impact of the action, you have to know the original conditions! Every impact is not quantifiable. A good evaluation must take into account: quantitative indicators (e.g. the number of beneficiaries, decrease in the symptoms of the problem, the economic value created, costs saved to society) and qualitative indicators (e.g. social well-being, participants’ accountability, contribution to the decrease in delinquency or to the social link to the community). You are not the only one working on the issue that affects you, and other macroeconomic factors (action by the State, economic tendencies, etc.) also influence the sector in which you are working. Know how to distinguish your impact from your simple obtained results.
Impact = obtained results – what would have happened in any case.
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6. What is the best plan for the implementation of your project? You have now thought about the why and the how. This part is about understanding what are the most relevant organizational mechanisms for your structure.
What would be the best team to lead the activities that you set up? What skills do you expect from your team members? What values should they share? What will be your decision-making process? Who will participate? What will be its organizational chart?
A good initial definition of the organization’s operation is also important both for the internal team as well as the external partners, and increases the organization’s chances of survival.
Keep the most important in your mind Pay attention to governance issues, and let your ego get in the way. In particular, ensure that the Board Members are:
From varied and complementary areas of expertise, as recognized professionals; Committed to the success of your activities and your mission; Available to devote time to meeting regularly ; Aware of the actions implemented and a force for strategic advice.
The members of your team are your wealth. Besides skills, do not ignore the culture and style of your organization. Ensure that the members of your team share the same values and the same desire to develop the project. Especially in social areas, agreeing on values is paramount for the success of the action Apply these values daily and personify them as the leader. Think about anticipating recruitment and maintaining the harmony of your team. For good HR planning, it is recommended to have:
someone designated for HR management detailed job descriptions drawn up ahead of the expected internal growth a clear organizational chart diverse and complementary profiles. 9 Disclaimer: The European Commission is not responsible for any uploaded or submitted content. The content expresses the views of its author(s) only. Project No 2017-1-BG01-KA105-035501
This guide was designed with the goal of being as concise as possible. By now, you should have clearer ideas and some useful tools in your pocket to develop your project and maximize your social impact!
Here are some BASIC entrepreneurship terms: А Additionality - a way to measure the benefits of a project highlighting specifically the changes brought about which wouldn’t have happened if the project hadn’t taken place. B Business Plan - is a formal statement of a set of business goals, the reasons they are believed to be attainable and the plan for reaching those goals. It may also contain background information about the organisation or team attempting to reach those goals. Brainstorming - is a group or individual creativity technique to spontaneously come up with a list of possible solutions to a specific issue Burnout - can be described as exhaustion of physical or emotional strength or motivation usually as a result of prolonged stress or frustration C Capacity building - Shorthand for a wide range of support, techniques and initiatives that allow individual participants or organisations to build and enhance existing knowledge and skills to improve quality of life. 10 Disclaimer: The European Commission is not responsible for any uploaded or submitted content. The content expresses the views of its author(s) only. Project No 2017-1-BG01-KA105-035501
Capital Costs - Are normally thought of as the one-off costs associated with the project such as equipment purchases and setting up costs. Civil Society - is the space between the state, the market and the ordinary household, in which people can debate and take action. By this definition, civil society includes charities; voluntary and community organisations, faith groups, non-governmental organisations and trade unions. Co-operatives - Businesses that are fully or majority-owned by their members – who may be employees, consumers, others in the community or a mix of these. An organisation with a democratic structure that trades for the benefits of its ownermembers. D Delivery Plan - A plan which sets out when, where and at what cost a project or programme intends to achieve. Direct Cost - Are the costs incurred directly as a result of carrying out the project/activity Dissemination - giving out or passing on of information. E Ethics - moral principles that govern a person’s behaviour or the conducting of an activity Evaluation - An assessment, after a project or programme has started, of the extent to which objectives have been achieved, how efficiently they have been achieved, and whether there are any lessons to be gained for the future. Exit strategy - What you will do when funding runs out and/or your project/business can no longer resource itself effectively and sustainably. What you do when you need to ‘call it a day’ on your project. F Focus Group - a group of people assembled to participate in a discussion about a product or service before it is launched, or to provide feedback on something such as a political campaign, or television series for example, before it is made public Funding strategy - How much money you need to raise to cover costs and the plan for how you might go about securing it. I Indirect Costs - Are costs to your project or organisation that will be incurred whether or not you deliver a particular project . E.g. you may employ an administrator 11 Disclaimer: The European Commission is not responsible for any uploaded or submitted content. The content expresses the views of its author(s) only. Project No 2017-1-BG01-KA105-035501
(whose salary would be an indirect cost to the project) but they will spend some of their time working on the project. In-kind - Is the provision of goods or services for which you would normally have to pay, but which the project is being offered for free. Innovative - Being or producing something that has never been done before. A creative new idea. Invoice - a list of goods sent or services provided, with a statement of the sum due for these; a bill. This is not proof of a purchase. L Leverage - Funding that results in additional monies and other resources being contributed or secured. E.g. a lucrative sponsorship deal that results in other companies getting involved. M Mission - the essence of your projects goals and the philosophies or beliefs underlying them, a mission statement is how a company wishes to conduct themselves day to day Match funding - A funder will offer a contribution towards your work on the condition that the remaining is to be found from another sources. Milestones - Key events with dates, marking stages in the progress of a project or programme. Significant achievements to your overall aim. Monitoring - Regular collection and analysis of input and output data, along with any other relevant information concerning the progress of the project or venture. N News Desk/Planning Desk - the department of a broadcasting organization or newspaper responsible for collecting news and stories. O Operating costs - Are the cost of resources used by an organisation just to maintain its existence. Outcomes - Are the changes that occur from carrying out your activities. Most easily worked out by looking at the way in which all of your outputs have addressed or not addressed your social need. Outputs - The results from activities carried out. Can be evidenced/proved in a variety of ways.
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P Partnerships - working together with another individual or organisation. Often they can bring together representatives from different sectors or communities of interest to agree and work towards common goals or benefits. Positive Rehearsal - using a mental picture and/or visual imagery to experience an outcome that a person wants to realise. For example, the ‘runner used positive rehearsal to picture herself running across the finish line first in preparation for their race’. Principle - an underlying statement which you and any member of your organisation will operate to Project Timetable - Proposal for how and when you will carry out your project. Q Quote - an estimate of costs submitted by a company or organisation to a prospective client, of products or services that potentially may be purchased R Real Cost Recovery - Includes making sure all the costs (including a proportion of the organisations operating costs) are identified and resourced to deliver the project. If not all costs are identified the organisation may end up subsidising the project. Risk management - is an analysis of what could go wrong, deciding how likely it is and what you will do about it if it does. S SME - Short for small and medium sized enterprises i.e. companies employing fewer than 250 employees. Social Entrepreneurs - The equivalent of business entrepreneurs, but operating in the social, not for profit sector. Their primary aim is to address social needs and to ensure they also make a financial profit doing so. Social Exclusion - is a concept used to characterise the disadvantage of individuals or communities resulting in those affected being prevented from participating fully in the economic, social, and political life of the society in which they live. Sponsorship - Sponsorship is a cash and/or in-kind return for access to the exploitable commercial potential Sustainable Development - Human activity which meets the needs of the present, without compromising the ability of future generations to meet their own needs. 13 Disclaimer: The European Commission is not responsible for any uploaded or submitted content. The content expresses the views of its author(s) only. Project No 2017-1-BG01-KA105-035501
SWOT - An exercise to evaluate the strengths and weaknesses of an organisation/project as well as the opportunities and threats. Social Impact Assessment - Is the process of analysing, monitoring and managing the intended and unintended social consequences, both positive and negative, of your project or organisation. Key question ‘Is your work doing something that provides a real and tangible benefit to other people or the environment?’ Social Return on Investment (SROI) - Is a way of measuring impact. Specifically, SROI places a financial value on the impacts brought about by a project or organisation. Stakeholders - A general term for someone who has an interest or concern in an organization or its work. Stakeholders can include donors, employees, board members, clients, volunteers, and the public. T Triple bottom line - The Triple Bottom Line also known as People, Profit, Planet attaches importance to social and environmental objectives alongside financial objectives. Trusts and Foundations - Charitable organisations set up to give money to and or invest in worthwhile causes V Values - specific characteristics that are not to be compromised by any member of your organisation at any time Venture - an undertaking by a person or organization that seeks to provide a solution to a particular problem, challenge or issue Vision - An aspirational description of what an organization or group would like to achieve or accomplish in the future.
Find more social enterprise terms explained at http://www.socialenterprise. org.uk/about/about-social-enterprise/social-enterprise-dictionary!
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