Salman Sabbab: Building Blocks of Building Social Enterprises in Bangladesh

Salman Sabbab: Building Blocks of Building Social Enterprises in Bangladesh

It takes a village to raise a child, and a thriving ecosystem to nurture a startup. The startup ecosystem in Bangladesh is steadily coming of age underpinned by steady economic growth, burgeoning purchasing power of middle-class population, and active presence of ecosystem players although the startup activities are only concentrated in Dhaka city only.

Many tech-based startups are creating a buzz with their innovative digital offerings, but social enterprises are yet to make strong statement in the country, which is dubbed as the Silicon Valley of social innovation — the birthplace of microfinance and ultra-poor graduation model.

As Bangladesh transitions into a middle-income country, there will be unprecedented opportunities for social enterprises to emerge, and meet some unmet consumer needs with market-based solutions typically in sectors such as — Education, Healthcare, Agriculture, WASH, and Financial Inclusion etc. — traditionally dominated by Non-profit Organizations (NGO).

BRAC wanted to open up its platform for aspiring social entrepreneurs to create more problem solvers in urban space, and launched Urban Innovation Challenge in 2016. It was an interesting experiment for BRAC to open up its resources for social entrepreneurs to lean on, and also contribute in the nascent startup ecosystem.

Over the past 3 years, I have had the opportunity to work closely with 12 aspiring Bangladeshi social entrepreneurs from their inception stage to prototype stage as part of BRAC’s Urban Innovation Challenge, and experience first-hand some of the challenges and opportunities social entrepreneurs experience while raising their social enterprises from the get-go.

Here’re some key insights for aspiring or existing social entrepreneurs:

Leverage Technical Expertise from Day Zero:

The nature of problems social entrepreneurs usually try to solve requires technical expertise, which can be defined as the combination of domain knowledge on a particular trade or skill, and prior experience of working on that sector.

For example, if you are planning to start a business offering technical products or services like low-cost housing, renewable energy, or healthcare, your core team must have someone with sound expertise on that particular sector, say as Architect, Energy Specialist or Doctor, who will take the ownership to make your product or service realistically feasible. We’ve seen entrepreneurs coming up with tech-based solutions for some social problems, but lacking in-depth knowledge about the sector; most of them have not gained traction. Therefore, if your team has a gap in technical expertise, you need to immediately fix it by bringing technical advisors or designers in your team.

On the other hand, Some of our successful incubatees did a terrific job in leveraging their technical expertise to make a strong statement with their proof-of-concept, which fast-tracked their progress to get their business off the ground.

Key Takeaway:

Do not compromise with a half-hearted effort while developing your core offering. If you have a technical solution, onboard a technical expert to be the gate-check of realistic feasibility if your team lacks domain expertise.

Photo: Renovation of a toilet facility by Bhumijo at Nur Mansion, Gawsia Market Area

Demonstrate HSC (Hustle, Savviness and Commitment):

We hear the term Entrepreneurial ability a lot. Here’s what it means to us, as based on my observations of working with some passionate social entrepreneurs. Entrepreneurial ability is a combination of these 3 attributes- Hustle, Savviness, and Commitment (which we term HSC) which are applicable for any entrepreneurs-no matter which sector they are working on.

Hustle signifies an entrepreneur’s ability to demonstrate a can-do attitude and strong agility for learning new things. From looking at different ways to solve problems to generating ideas to testing prototype to getting ready for investment, a social entrepreneur has to wear multiple hats — stakeholder mobilizer, project manager, product designer, talent manager, etc.. Oftentimes we see, these founding team members often take their initiatives as an experiment or as weekend projects, and finally devote full-time after completion of Minimum Viable Product (MVP) or securing seed-funding. After receiving the seed-funding, new set of activities crop up revolving around increasing sales, building and managing team, and ensuring proper governance.

Key Takeaway:

An advice to any aspiring or existing social entrepreneurs would be to double down your effort particularly in the prototype phase which will not only help your team to achieve desired results, but most importantly, prepare yourself for handling upcoming challenges. If you still think that you will step up effort once you secure funding, you might miss out to deliver results on time.

*****

Savviness here means an entrepreneur’s capacity to take strategic decisions. During prototype or pre-incubation phases, a social entrepreneur has to make strategic choices on how to negotiate with early clients, forge relationships with stakeholders, mobilize resources for prototype testing every now and then, and not to mention chase the right investors. Somewhere in-between trying to do things rightly and doing the right thing, a social entrepreneur must always reflect on their performances and deliberately seek to improve their interventions. While allocating seed-funding for required activities, you need to activate your system-level thinking to take good strategic decisions on how to use the funding to take the social enterprise forward.

Key Takeaway:

In early days, you must be strategic while identifying some specific early-traction points for your social enterprise to fast track your journey to take it to the next level.

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Commitment is a must-have attribute for any entrepreneur. Your first commitment should be towards the core problem your organization is striving to solve. Oftentimes, entrepreneurs tend to fall in love with the solution so much that they lose sight of the roots of the problem. It might eventually deviate you from the entrepreneurial track.

Secondly, you must be committed to your organization’s vision and culture. We’ve seen many times that co-founders fall out internally due to lack of team synergy, dynamism, and shared goals. Therefore, it’s critical to be committed to delivering results as a team.

Lastly, you must be committed towards your key supporters- be it investors, incubators or accelerators. Many of our successful entrepreneurs showed great team spirit while working with us, and their sheer professionalism also reflected in their day-to-day activities.

Key Takeaway:

Commitment is infectious. If you can demonstrate deep commitment towards the problem, team and stakeholders, no doubt it will also get reflected in serving your customer efficiently.


Every First Counts:

Another important observation from working with social entrepreneurs is there will be plenty of opportunities from home and abroad if you can come up with any untapped solution. Large organizations, like BRAC, UNDP, or UNILEVER, Grameen Phone can offer entrepreneurs endless opportunities to leverage their platform to expand sales in different regions. Besides, in Bangladesh, working with government-led projects can also open up opportunities to scale-up as the government is also pretty much keen to create more homegrown startups that can deliver impact and financial results. Great services and products are not always enough- you need to learn quickly how to communicate remarkably with your key stakeholders.

Therefore, it is critically important to create remarkable value in every single component of your work — be it in your idea, prototype, evidence, services or products, email, video, presentation — which can woo your target group and key stakeholders and turn them into supporters of your idea. If you fail to gain traction immediately, it’s completely fine. But, then you have to quickly reflect on your approach and learn quickly to fine-tune it before approaching distribution channel partners. Remember that opportunities are oftentimes one-time, and therefore, you need to be prepared to tap into those opportunities.

Key Takeaway:

Leveraging opportunities is a skill entrepreneurs need to develop and fine-tune as they move towards incubation and investment phase.


Pulling Funds is Easier than Pushing Funds:

Funding is no doubt critical during seed-stage and early-stage, but it’s only the tip of the iceberg for early-stage social enterprises. At a time when impact investment space is gaining prominence, you will find many opportunities to secure follow-on investments.

The best marketing tool for any social enterprise is its Unique Selling Propositions(USP) of its products or services which will speak for itself. Oftentimes, social entrepreneurs become complacent about their business model, and don’t want to change the service proposition.

You need to always on the lookout for creating complementary categories to strengthen your business model. Those new categories will unlock new funding opportunities for your business. As soon as you’ve have found the right product-market fit, you won’t have to much worry about raising funds.

Key Takeaway:

Whenever you have a very fantastic idea to prototype, don’t just hop on attending different incubation or accelerator programs to secure potential grants or supports, rather give your maximum attention in your prototype to go the extra mile to create strong proof-of-concept of your model. Your unique model will speak for itself.


Building a Resourceful Team:

Talent acquisition and retention are the biggest bottlenecks social enterprises face in their early-days. Besides being a committed team player, a social entrepreneur must spearhead the team as a role-model, and spend a great deal of time with early-recruits to unlock their leadership potential.

An early-stage social enterprise might not offer competitive salaries to its staff, but certainly, it can offer meaningful learning opportunities. Therefore, the co-founders must find some meaningful learning opportunities for those early-recruits. Besides, there will be many key activities you need to perform from scratch, such as developing new guidelines for your office and staff, writing proposals for funding and so on.

Therefore, it is essential to document all these core activities as a playbook so that it can be a great guiding resource. You can always hire people to create those guidelines, but any existing document will always help a new team member to catch up with existing practices. Also, try to set up strong values and culture in the organization so that employees can feel valued and get a sense of their valued contribution.

Try to set up Research & Development unit or product unit where you might want to recruit some enterprising interns to come up with fresh ideas.

Key Takeaway:

Besides being a committed team player, a social entrepreneur must spearhead the team as a role-model, and spend a great deal of time with early-recruits to unlock their leadership potential.


Fixing Business Model Requires Multiple Iterations:

From the first designed prototype to seed-funding raising to further round of investment, a social entrepreneur has to be ready to tweak its service or product offerings, and business models in the changing context. From the get-go, social entrepreneurs must invest in its product team or research unit to strengthen the capacity of the team so that the team becomes more responsive to the demands of the customers.

For B2C models, the core strategy should be geared towards creating new customers, by offering relevant unique products or services for the targeted customers, and for the B2B model, the core strategy should lie on building relationships with key customers and stakeholders. That’s why it is critically important to have a wider focus on the growth of your enterprise, and its sustainability- not being obsessed with certain projects.

Along the journey, you also have to find some experienced as well as resourceful mentors who can champion your cause and act as a sounding board, and guide you to de-risk your social enterprise as well as set up important milestones to take your business forward.

Key Takeaway:

You need to be very patient while iterating your business model in early days, and always strive to find the right sweet spot of your business model.


There is no silver bullet to make your social enterprise a success story overnight- but the above-mentioned reality checks will certainly propel your initiative in the right direction.

For any social entrepreneur, it’s critically important to get familiar with the underlying trends and dynamics of the industry to take your entrepreneurial journey off to an uplifting start. Those who also tried and failed, there should be no regret rather they should deserve brownie points for treading into this challenging terrain and most importantly, learn the gaps.

As a concluding note, I would particularly urge more and more social entrepreneurs to join this wonderful world of problem-solving leveraging technical expertise to bring breakthrough solutions of social problems.

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