Want to be a Social Entrepreneur? More on this From Chaarvi Badani
Chaarvi Badani shares her insights on how to become a social entrepreneur in India.
Social enterprise is the latest buzzword in the entrepreneurship ecosystem. The concept itself has been around for a long time, though in varied terminology. Today, social enterprises are defined as businesses which are set up to change the world. Like traditional businesses they aim to make a profit, but through their services and products – by giving access to communities that cannot otherwise avail these services or by employing producers to whom this income can make a considerable difference.
Social enterprises can exist in all sectors – education, skills training, healthcare, agriculture, water, sanitation etc.
As per a British Council report there may be as many as 20,00,000 social enterprises in India with a growth expected to push the number to 2 million. If you want to jump on this bandwagon of social entrepreneurship, that’s great! Or are you an early-stage entrepreneur, already in the thick of establishing your business?
But before you take the next step, here are some things you must consider to ensure that you’re on the right track:
The big ‘Why?’
I cannot stress enough on the importance of figuring out the why you want to plunge into this line. Yes, some soul searching is required to find the answer that resonates the most with you. Do you want to truly create change? Are you passionate about a particular problem and have a stellar solution? Or are you enchanted by the idea of being your own boss and running a business? There’s no right or wrong answer to this question but knowing your reasons will help you decide the course of your business, how much time you spend on it (part-time/fulltime) and how you see this endeavour shaping your life.
Problem – Solution Fit
There is a lot said about finding the right problem-solution fit and yet, it’s not enough! Just like all businesses, you need to ensure that there are buyers for offering. Spend time with your beneficiaries to truly understand their pain points and problems. Ensure that your solution solves a real problem that communities are facing as opposed to a problem you perceive a community is facing. This is often the foremost reason that social enterprises fail. Tools like empathy mapping, business model canvas and value proposition canvas are useful to map your solution and its corresponding problem.
Ensure that your solution solves a real problem that communities are facing as opposed to a problem you perceive a community is facing.
To co-found or not to co-found?
If you have a company with a single founder, it is worthwhile to consider hiring a co-founder. Yes, your company can feel like your baby and you want to be possessive about it. But being a single person managing a business is tough work! Here is a guide to think about hiring a co-founder.
- First, is there a specific skill set that you lack, and is critical for growing the business? Find a person who complements your skillset.
- Secondly, if you do plan on bringing on a partner, you must be open to an equal partner who has as much decision-making power as you, else the person is just another employee under you.
- In the long run, when you decide to fundraise from incubators and investors, they prefer to see teams with complementary skill set rather than a single co-founder company.
Wholesome company growth
When starting out, it’s undoubtedly important to concentrlegal compliancesate on your core offering. But alongside, think of the larger aspects of a company’s growth – such as , finance and accounting standards, human resource issues, patent and licencing. These will ensure that your company grows holistically. In the beginning, it is useful to engage with friends/family who are experts to help you think through these issues. In the long run, work with well-established firms who will give you this guidance. Today, there are many service firms that focus specifically on issues that startups face. As a founder, you need to know the ins-and-outs of your business. It doesn’t matter if you’re not a legal expert or bad with numbers! You will need to spend time on these aspects that can potentially make or break a business in the long run.
In the early days, it’s tough to put a figure on sales projections, but its critical. These figures will help you estimate your potential cashflows, cash burn and when it’s time to fund raise. Based on these projections, you can estimate your potential capital needs in the coming years for product development, hiring, sales etc. Fundraising is a long and often slow process, so it is good to start much before you are in dire need of investments, at least 6-8 months earlier. When you start fundraising, list all the options available to you – grants, investors, government schemes, loans from banks, crowdfunding etc. Based on the stage of your business and the capital requirements, you can narrow down on the particular source(s) of funding that are apt for you.
Network, network, network!
Ah, the dreaded word – networking. Alas, you gotta do it! Remember, you aren’t the first person to start a business, and chances are, your idea may not be the most unique. Use conferences and meetups to sound your idea off other entrepreneurs, investors and ecosystem players.
I often say that being an entrepreneur is being a hustler. You must be on a sales mode and actively find the best connections to get your things done! Use these platforms to find potential hires and partners.
But on the other hand, don’t go blindly to any event that says “Startup” in its heading. Spend considerable time researching on the themes and topics the event is based on, and most importantly on the guest list/speakers. Before you attend the event, try and contact the potential people you want to network with at the event. A quick email stating that you’ll be at the same event and would love to meet them is a good start.
Doing all of this may seem daunting to begin with! Being an entrepreneur, social or not, is tough work. Your first cheerleaders will always be your friends and family. Keep them close and sound off your ideas with at least a few trusted ones. Remember that the first step is simply starting. And then you have to keep putting one foot in front of the other and keep walking.
Chaarvi Badani works at Villgro Innovations Foundation, an early stage social incubator and investor. She’s an ex-entrepreneur working at the cusp of handicrafts and livelihoods in India, who is also an Young India Fellow.