Lesson – The first step of a social entrepreneur

EPISODE 3: The first step of a social entrepreneur

What to expect in episode 3

Welcome to episode 3 of “Empowering Change: A MOOC on social entrepreneurship in Western Balkans”. In the previous episodes, we defined the concept of social entrepreneurship and described what it is like to be an entrepreneur. Now all you have to do is get started! But where do you start? “Do I start by designing my idea? Do I start by looking for financial partners? First things first! It’s important to follow each step of the way if you want to create a viable and impactful business! Step 1: Define the social enterprise idea We’re going to start by creating the basis for an idea for a social enterprise. To do this, we need to start with the social problem and work towards a solution. In this first stage, you will reflect on 5 parts: The social need, the vision, the social mission, the operational objectives and the values of your social business. Defining your social needs will enable you to define your problem. Keep in mind that you need to be excited about this issue, otherwise the difficulties ahead will affect you more quickly. Start by asking yourself the right questions to formulate your social need: – What is the problem? – Why is it a problem? – What are the causes? – How serious is it? – How urgent is it to remedy? – What are the beneficiaries’ needs?

Step 2 : Let’s explore the market

Understanding Your Beneficiaries: After you’ve thought about your project, it’s crucial to go out and meet the people you’re aiming to help, which we’ll call “beneficiaries.” Beneficiaries could be users, customers, or members of your social enterprise. If you have different groups of beneficiaries and customers, you will need to meet the needs of both. Focus on Their Needs: At this stage, put aside your own solution ideas and concentrate on understanding what your beneficiaries really need. To do this, you should meet and talk to them. You can use a questionnaire to gather valuable insights. Explore the Ecosystem: Consider the larger context or ecosystem. Are there other organizations in the social economy working on similar issues? Are they competitors or potential partners? Identifying these entities is essential to avoid disrupting the existing ecosystem. It’s good to build on what already exists rather than reinventing the wheel. Market Research: Once you’ve met your target audience and identified the key players, it’s time for market research. This involves collecting and analyzing information to understand the market better. Market research can take different forms, such as gathering opinions, studying documents, or using numbers. It helps you identify your project’s strengths and weaknesses, spot trends that could be opportunities or threats, and make informed decisions.

Step 3: Creation of the Offer

As your research journey unfolds, your strategy gains precision, and your vision for your social enterprise idea becomes clearer, along with its distinct value or value proposition. This isn’t just about describing the service; it’s about what your product or service will genuinely deliver to your beneficiaries. By staying committed to this focus, you’ll resist the temptation to appease all partners, keep your offering simple, and maintain its clarity.

Step 4: Test of the Offer

Now, I’d now like to introduce you to an essential tool for launching a social enterprise: the Business Model Canvas. The business model canvas is a simple method for building your business model. It represents your business model on a single page in the form of a table. This quick and concise process can also help you to prepare the oral presentation of your project. You can find the template in the resources section to complete it yourself. this table is made up of 12 parts: – The social need – Potential strategic partners – Your social or environmental impact – Your business activity – Your value proposition – Your customers and/or beneficiaries – Your source of income according to your activity – Your resources – Your costs – your sources of income – Customer/beneficiary relations – Distribution channels The research and theory part is finally over, even if you can and must come back to it to ensure that your idea continues to evolve. You now need to test your social enterprise idea by creating a prototype, also known as the minimum viable product or MVP. It’s a product with enough features to attract early-adopter customers and validate a product idea early in the product development cycle. The MVP can help you receive user feedback as quickly as possible to iterate and improve the product.

Step 5: Consolidation of the Offer & Launch

With your offer tested and approved by your customers and beneficiaries, you can now fine-tune the details of your business model, register your social enterprise legally, define a budget and create your communication strategy with your name and logo. Finally, to launch your product and make your first sale, you will need to look for funding. There are 8 possible sources Self-financing: you or your partner can make a personal investment in the form of cash or in kind (tangible or intangible assets). Love money: Start-up financing can also come from family and friends. This is known as love money. Friends and family may wish to invest in the company because they believe in the project. In this case, the entrepreneur can repay the loan interest-free and within a relatively flexible timescale. The flexibility of this solution makes it an attractive alternative. However, family members must be clearly informed of the risks of this loan. They need to be aware that they may never see their money again if the business project fails. It is therefore strongly recommended that you draw up a written agreement to avoid any disputes. Bank loan: A bank loan is a classic method of financing. However, it is not the easiest source to obtain. Banks generally require a minimum equity contribution from the start-up founder before granting a loan for the creation of a business. Participative financing: Participative financing, or crowdfunding, involves the entrepreneur presenting his or her start-up project on an online platform. This financing method relies on convincing communication. If the project is attractive, some investors may provide financial support in the form of a donation, loan or financial contribution. Business angels: These are private shareholders who participate in financing the start-up. They are trusted individuals who believe in the project’s potential. In addition to the financial investment, these sponsors support and guide the entrepreneur in the creation and development of the business. Business incubators provide financial support and guidance to social start-ups. They provide financial assistance for business start-ups and advise them on their creation and expansion, making them a valuable source of funding for social start-ups. Start-up competitions: Innovative social enterprises can also take part in competitions. These events allow the entrepreneur to meet potential investors and gain a certain amount of visibility. Public support for business start-ups: Depending on where the business is based, the entrepreneur may be eligible for support for business start-ups. You are now ready to set up your social enterprise and make your first sales! It’s a journey that requires total dedication and unfailing motivation! It’s also a path that allows you to meet inspiring people who want to make the world a better place.

Conclusion

To conclude, we recommend that you get support from an incubator for a number of reasons: It will provide your start-up with the essential knowledge needed to transform a promising idea into a successful social enterprise through personalised support, tailored advice and meetings with experts. The incubator provides start-ups with all the tools and resources they need to create a business, such as premises, equipment and technologies, services, etc. You will become part of a network of social entrepreneurs. The simple fact of exchanging ideas and establishing relationships with other professionals will help you enormously. You’ll get contacts, references, new opportunities and often visibility in the very sector you’re trying to develop.