Social Entrepreneurship Planning
If a nonprofit decides to go ahead with a social entrepreneurship project, it is important to invest as much time into planning it as someone starting a stand-alone business would. This means following similar steps:
Find the right fit. Don’t just try to copy what another group is doing. Ideally, you want an idea that is a natural extension of your current mission, skills, and resources. An idea that builds on existing resources is much more likely to succeed than one that is totally separate and unrelated to what you currently do.
Test the waters. Make sure that the majority of your board, staff and donors accept (and ideally embrace) the idea of starting a for-profit venture. Even the best idea will require significant time and resources to succeed, so it is important to have a broad base of support
Be clear about your goals. Is this venture intended to be solely a money-making project or do you expect it to also contribute to your mission and/or your public relations efforts? It is okay to have multiple goals but you’ll want to be clear (and in agreement) up front about what these goals are and how they will be achieved.
Be realistic. It is absolutely critical to do the research necessary to make sure your projections are realistic. This not only includes the amount of income you expect to generate in sales, but also the costs you will have to incur to raise this money, when you can expect to begin to turn a profit, and how much staff time will need to be diverted from your nonprofit mission to make this new project successful. These calculations can be complicated so, if you don’t have access to someone with specialized knowledge, it is a good idea to contact your local chamber of commerce, economic development office or Small Business Development Center to find someone who can help you. The greater the investment you anticipate making in your new venture, the more important it is to make sure you have reliable projections prior to spending your first dime.
Set benchmarks. Based on your projections, develop a detailed business plan that includes a series of incremental targets by which to measure your progress. In addition to helping you determine whether or not you are on track, these realistic goalposts can help keep you from panicking or motivate you to make necessary changes.
Plan to be flexible. Regardless of how carefully you plan, you will likely need to make some changes to your plans in response to customer preferences, economic shifts, staff turnover, unexpected events, etc.