Building a social enterprise is a doubly challenging job than building a solely profit-driven company because social enterprises mostly operate in areas where market-driven interventions fall short. This reality poses a different kind of challenge to the social enterprises. Consequently, in order to succeed as a social enterprise, you have to be innovative and better in everything you do, including how you approach your product development and how you design your business model.
In a recent interview with Future Startup, Mridul Chowdhury, founder and CEO of mPower Social Enterprises offers a playbook for early stage social enterprises to build a sustainable business while ensuring lasting impact. We have handpicked the lessons for your here. If you want to read the full interview, please go here.
Enter Mridul Chowdhury
1. It not about the product, it is about the value you’re offering through your product.
Companies must understand the value proposition rather than be too hung up on the product. Companies need to understand what they are actually proposing as value. They should also validate and re-evaluate their value proposition on a continual basis.
2. Build an ecosystem as an alternative business model instead of solely relying on your end customers.
Do not focus only on the end customers. The end customers will not often be able to make the service viable. You have to broaden the number of stakeholders and build an ecosystem so that you can add different layers of possibilities. To achieve continuous growth this is very important and growth is the key.
3. Build partnerships, improve your brand image in order to retain the market when competition grows.
In the early days, we were actually creating the market for ourselves. There was demand but a huge chunk of it was latent and people could not articulate it properly.
But as you grow you have to consider the fact that when the market will grow, other competitors will come and may take over the market. A lot of startups make this mistake by investing more in the existing clients rather than building the brand, adding product features and partnerships. When the competition comes, they fall short of resources needed to the grab opportunities. Social entrepreneurs have to think about being the market leader after the market has been created from day one; otherwise, they will lose the grip on the market. Build strong partnerships, brand recognition and contacts in the market so that new competitors with a lot of muscle power cannot wipe you aside.
4. Measure your impact and create evidence of it.
Create evidence of impact. After some time, you have to go in front of the investors and show them the result of your work. You have to tell them how much impact you have had in the field. Often we don’t think about it and don’t collect data systematically about our impact. As a result, we fail to provide evidence of our impact. I have seen a lot of social enterprises who said that they have done a lot of good things but they don’t have any evidence of their impact and outcome. You should keep this in mind while running a social enterprise.