I started a social enterprise to save the world but all I ended up with was a failing t-shirt business

Over the years I’ve attended quite a few events where people in the process of starting new social ventures* ‘pitch’ their idea to a panel and/or wider audience. And on several occasions I’ve been one of those people. Even when allowing for our individual pitching abilities, many of these ideas are transparently absurd (at least, to everybody else).

The stereotypical starting point (type one) for wannabe social entrepreneurs – even once they’ve had enough absurd ideas to be tagged as a ‘serial social entrepreneur’ – is that they have an idea that offers significant social impact but doesn’t work as a business.

They want to do x thing for x group of people, there’s at least a plausible suggestion that x group of people might want it and it might really be useful but x group of people have no money to pay for it. So the type one social entrepreneur faces the (often insurmountable) challenge of finding *some other way* of paying for it.

At the other end of the spectrum (type two), there are nice people who want to start a business doing something they’re good at and, because they’re nice people, they feel compelled to contort their business plan in a bizarre way to include what seems to outside observers to be an entirely unrelated social element.

Social sourdough

So fictional social venture ‘Pizza, Love and Understanding’ is a pizza parlour but it’s going to deliver real social change for ‘disadvantaged groups (specific group – tbc)’ by using the profits to pay for them (the ‘disadvantaged groups’) to take part in workshops which will generate art with a strong social message to be displayed on the wall of the pizza parlour.

And because it’s important that disadvantaged groups are recognised as real artists they will be paid for their art (possibly in pizza).

Type two is mostly ignored as there’s no point wasting energy being rude to well intentioned people who will (in most cases) soon recognise their mistake and get on with trying to run a pizza parlour. That’s a good result. Pizza parlours that sell good pizza and pay decent wages are a good thing.

Extreme basket weaving

There is a type three, though. People who, once again with the best of intentions, find themselves pursuing an idea for a social venture that combines the absence of a business model with a lack of clear potential for social impact.

Are you building an online one-stop-shop for young people who want to bring communities together through the medium of extreme basket weaving?

Is the business model ‘corporate sponsorship’?

If so, look away now.

Once again, while the real life equivalents of fictional social venture ‘ComYOUnityBasKITcase’ are far less actively stupid, the basic recipe is the same.

Ingredient one – something you (at best) know how to do well or (at worst) have recently heard of

Ingredient two – a positive but non-specific and essentially unrelated social aim

Ingredient three – a broad category of funder/customer that you think has lots of money to spend on good things

Method – Attend pitching event. Get a grant from Unltd. Don’t sell anything. Attend conference to complain that funders/investors/customers never fund/invest in/buy innovative ideas. Repeat for 1 to 5 years.

I can’t say for sure whether type three social venture ideas are becoming more prevalent but there is certainly a strong, well established pipeline and it’s not clear that social entrepreneurship support organisations have a humane strategy for putting them (the ideas, not the people who have them) out of their misery.

Youth hostelling with Chris Eubank

As Alan Partridge memorably demonstrated, some of the worst ideas (many of which the advent of digital TV has since brought to fruition) are motivated by the toxic mix of panic and desperation. But, while parody TV hosts need to have terrible ideas, aspiring social entrepreneurs don’t.

There is another route. That is to start by putting some time and effort into researching the social change you want to make. It’s not necessary for all social entrepreneurs to single-handedly solve a problem for the whole world in the Ashoka style but it is necessary to solve a problem at some level for someone.

The best way to do that is to work out what the problem is. What annoys me most about the prevalence of stupid ideas for social ventures is that it’s not as if we have a shortage of problems for clever, socially-focused people to take a look at.

How do we look after people who are living longer but need additional help to have a good quality of live in old age?

How do we support people with severe and enduring mental health problems when institutional treatment is both unaffordable and undesirable?

How do we connect with the young people who would really like to weave baskets in an extreme way to help their communities, and give them the online tools they need to do it?

Creating a successful business to address a social need is really difficult but working out where to start is not as difficult as some of the organisations theoretically supporting social entrepreneurship and social innovation in the UK currently make it look.

Ephemeral tosh

If you want to start venture (and you live in a major metropolitan) it’s virtually impossible to avoid support designed to develop your basic business skills – and plenty of support for (often, small and unproven) social ventures to ‘scale-up’.

There’s very little work being done to help social entrepreneurs actually become skilled and knowledgable in the things they’re trying to do – or to put people who are skilled and knowledgable together with people who’d just like to do something good to see if they could do something together.

In that context, it’s not surprising we end up with so much ephemeral tosh and so few successful social ventures addressing real social need.

Keep it stupid

None of this means it’s desirable to discourage people from pursuing really stupid ideas for social ventures.

Lots of great (or, at least, quite good) ideas emerge from the dregs of really stupid ones. Pizza, Love and Understanding’s incongruously worthy arts workshops might ultimately be the starting point for the creation of an arts organisation that does create some great art and/or some positive social change while not needing to be connected to a pizza parlour.

And the social entrepreneur who created ComYOUnityBasKITcase might come out the other side with the hard-earned practical experience they need to do much something more useful next time.

It’s not social entrepreneurs and our stupid ideas that’s the problem, it’s the dearth of support and funding to help us develop the knowledge, and find the time and space to move beyond them.

 

*In this context, a ‘social venture’ could be a charity, social enterprise or other any organisation/activity initiated with the aim of make the world a better place (at least partly) by selling stuff

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15 Comments

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15 responses to “I started a social enterprise to save the world but all I ended up with was a failing t-shirt business

  1. I’m sure there are business ideas which aren’t entirely viable, which end up being at least in part, grant dependent. It isn’t the first time I’ve heard this criticism made of the social enterprise community.

    Who is it that encourages and guides them? My only experience is of those who tell us we’re outside their focus.

    I offer a very different scenario. Business ideas which mainstream business wants to own. For example, investing in ending a social problem for a reduction in state budget.

    In our case it came in a formal proposal arguing for transition of children from institutions to foster care. Even David Cameron sees the value of this one.

    How did The British Council work themselves into a social enterprise development proposal we delivered to USAID. Why did they partner with oligarchs and turn us away?

    Why does Sir Richard Branson seem to shadow our every move?

    Why are so many business leaders now arguing that capitalism should deliver social benefit as well as making a profit,?

    I know where this came from.

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  2. Gladly, I’ve never wanted to weave baskets or bake pizza, but I do believe that creating a business that meets a recognised market need, in a socially responsible way, free of the self limiting constraints imposed by many of the favoured legal forms, can win over those that aim for profit alone. Is that social enterprise? Perhaps it’s just comon sense!

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    • Robert, a key point we made was that a business could contribute whatever it liked to benefit the community, provided this was deemed to be the entire point by shareholders and directors and declared in the corporat charter
      As law professor Lynn Stout confirms in her book ‘The ShareHolder Value Myth’, there is no law that obliges any business to maximise profit for shareholders.
      Clearly there need to be some guarantee that this is being put into practice and that was the reason for proposing a permanent irrevocable trust fund – a form of asset lock.
      Some law firms might disagree, but they are in the business of making money whereas what I describe was shared “free to use”
      As we said in the business plan shared with the social enterprise community:

      “Bottom line must be taken one step further by at least some companies, past profit, to people. How profits are used is equally as important as creation of profits. Where profits can be brought to bear by willing individuals and companies to social benefit, so much the better. Moreover, this activity must be recognized and supported at government policy level as a badly needed, essential, and entirely legitimate enterprise activity.”

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  3. Bad day?! So, what’s the solution? How can we better harness the energy and drive to do something socially useful and help it to find a suitable outlet? I feel in many ways that what you describe above, David is why we end up with an ever-evolving range of business forms and types. People recognise that types 1-3 are ending up tarnishing views of what a social enterprise is and are trying to differentiate.

    Perhaps we just need to clearly spell out more of the “common sense” examples that Robert describes, illustrating what are some of the key components of success (not a specific legal form). It may seem like common sense but it’s easy to get carried away with what seems like a great idea…

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    • Beanbags admin

      Hi Nikki,

      Not a bad day – just a train journey with limited wifi providing an opportunity to write a blog rather than getting on with ‘real work’!

      I think you’re right that frustration at these challenges is part of what drives the creation of an ever-growing range of new sector labels, corporate structures and registrations.

      That’s unfortunate because the vast majority of these interventions are confusing (and often expensive) displacement activities that have no impact on the underlying problems.

      It terms of cross-cutting components success, there’s: (a) do something that solves a problem for someone and (b) sell it (in the broadest possible sense) to someone for more than it costs you to do it.

      Beyond that, there aren’t many broad points I’m aware of that are substitute for doing some proper thinking and hard work defining the problem you’re seeking to address.

      It’s the focus on defining problems that I think we need more of. Organisations supporting social entrepreneurship – both state/Lottery Funded ones and corporate ones – need to put less of their resources into providing basic business support and more into helping people (and groups of people) understand what they’re trying to do, and then into working out how what they’re trying to do relates to markets that actually exist.

      We have lots of social entrepreneurs who develop internally logical business plans – supported by people who understand Excel and business plan templates but don’t have the skills or knowledge to challenge entrepreneurs on the likely social impact of their product or service, or the market conditions that will determine whether the figures actually mean anything.

      It would be useful to put more emphasis on bringing together academics and charities who know a lot about a subject with people who want to do social change. Not in the crude sense of demanding that social enterprise ideas are specifically justified by research recommendations but in terms of using knowledge as a starting point for developing ideas, or as a way of modifying the entrepreneur’s own initial idea.

      In terms of working with charities, there’s some useful ideas in this report.

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  4. Absolutely brilliant! If you were living in my skin you couldn’t be telling my own story more directly! Thank you for sharing this — it gave me hope when I was feeling like a failure! Cheers

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  5. Hi David – as ever, lots to agree with here. A few thoughts:

    – I think you are right about research although, to be fair to SSE & UnLtd, many getting support had experienced the problem they are/were trying to solve (aka biographical social entrepreneurs) which, in theory at least, gives them some understanding of the problem; but setting people up to fail isn’t learning by doing and I do think this happens too much (particularly when programmes have output-based targets)

    – I wonder if this is less about research than about hard skills and commerciality; I agree with SSE’s view that ‘soft’ skills are important for entrepreneurs, but in my 6 years there, I got increasingly convinced of the need for hard skills & commerciality at an earlier stage (precisely for some of the reasons you indicate above): a form of which I undertook by asking ‘who pays?’ on a continual loop. The old adage of testing it out on customers / plans falling apart etc is an old adage for a reason

    – there is a balance to be struck, though; the other thing you see at SSE & UnLtd is people trying something and, even if it doesn’t work, building up networks, confidence, resilience and insight for the next idea (and most come with more than one, even if they haven’t picked the right one…); and sometimes what you or I might think is crazy turns out to be much less so after months of twists and turns

    – finally, there is a risk that what you write above could lead to even more paralysis by analysis; already the overwhelming amount of info people are given (legal structures! measuring social impact! good board! investment & finance! building a team! replication strategies!) tends to lead to a lot of good business plans, and many fewer actually good businesses – I wouldn’t want an emphasis on research to lead to more planning and less action (I know that isn’t what you intend) or, more accurately, lead to less of a focus on testing the viability of the business model in the real world. As you say, understanding the markets they are seeking to operate in.

    Cheers

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    • Beanbags admin

      Hi Nick,

      Thanks for this. All good points – and probably the starting point for a blog in all of them.

      On the biographical social entrepreneurs, while I don’t think personal experience of a social problem should be the only acceptable reason for starting a social enterprises, I do think it’s a good one.

      Where problems often occur is when there’s confusion about what experience does and doesn’t enable you to do. If I ever have open heart surgery, I won’t be specifically keen to have it carried out by a surgeon who has had open heart surgery themselves.

      On the other hand, if I need help dealing with the effects of open heart surgery on my life, support provided by someone who’s head the same experience might be useful.

      While I’m suggesting that social entrepreneurship supporters have taken their overextension quite that far – I think there’s sometimes been a failure to question the extent to which the personal experience which provides someone motivation also provides them with relevant expertise.

      Your 2nd and 4th points on hard skills and danger of over analysis are definitely right. Agree that SSE (when you worked there and I was a student) while being great in others ways didn’t focus enough on business models (in their broadest sense). Not that all social entrepreneurs are necessarily starting businesses but social change has to be paid for somehow (even if it’s primarily paid for in-kind through voluntary effort) and working out how it’s going to be paid is the most important question (at least, after ‘why are you doing this?’).

      My problem with the basic business advice model that is offered by other support programmes is that it’s about churning out pretty spreadsheets and lengthy business plans which – when you’re at the point of working out what you’re selling and whether anyone wants it – are often used to avoid the real questions about the business model rather than answer them.

      On research, what I mean (and didn’t explain very well) is that there’s a need for social entrepreneurs to research their customers’ problems – while possibly, at the same time, refining their ideas about who their customer is.

      That definitely shouldn’t involve loads of planning in the abstract. Nor should it involve insisting products and services are proven to work before they can be tested (unless there’s clear legal or ethical reasons why this is necessary).

      The NHS which (quite rightly) demands a strong evidence base before allowing drugs and other medical treatments to be administered to patients is (both nationally and in many local areas) currently making a big mistake in applying the same logic to non-medical interventions – such as apps – that are not medical treatments but could improve patients’ lives.

      The challenge is to be as clear as we can about the problem we’re trying to solve. Starting with big problems (‘how do we provide advice services when there’s growing demand and shrinking resources?’) and drilling down into them (‘if the advice people need is all on the internet, why don’t they just Google it?’) and testing ideas (‘what would an email-based advice service provide that Google doesn’t?’).

      I need to think more about how this could become an approach to social entrepreneurship support, though.

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  6. Very good 🙂 As always with your writing, entertaining and on point.

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  7. Pingback: Sprinting towards the weekend: Have I Got Social Enterprise News For You | SSE

  8. Great read. Is there a ‘not’ missing from the final sentence? Are we the problem or not?

    On a less pedantic note, of all those offering support, are there any that are close to getting it right?

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    • Beanbags admin

      Hi Luke,

      Thanks. You’re right about the ‘not’. I hope it’s that everyone else has been inserting it automatically based on the context rather than that you’re the reader to get to the end!

      Good question about the support providers. I’m not sure. SSE are the support provider that I have most direct experience of and I think their overall offer was/is really good – in terms of helping social entrepreneurs to become people who can do things and convince other people to help them do things.

      There isn’t a major support provider that I’d direct an aspiring social entrepreneur towards to find out more about markets and business models. It’s a gap in the market or maybe, ironically, no one’s doing it because funders wouldn’t fund it!

      Colin Crooks at Tree Shepherd is good at this stuff but he’s a social entrepreneur helping general businesses – rather than a specific social enterprise support provider. There may be something in that.

      Liked by 1 person

  9. Pingback: Learning from experience – part one | Beanbags and Bullsh!t

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