Superheroes save people’s lives on a regular basis at the box office…
The government is trying to provide more accessible health care for all…
But only one force is truly making a positive social impact: entrepreneurs. These days, it seems that more and more small business owners are making it their mission to contribute to society in a meaningful way while earning profits.
Entrepreneurs are devoted to helping those less fortunate and improving the environment, among other areas.
(Check here for Forbes’ 30 Under 30 list of promising social entrepreneurs).
Perhaps it’s a result of the economic collapse and the alleged corporate greed that caused it. No matter the reason, the face of American business is changing. It now has a more optimistic glow, with its bright eyes focusing on holistic business practices.
Here are a few effective ways in which social entrepreneurs should approach business. Do these apply to you?
Reportedly, the last year saw a 7% increase in the number of business leaders who described themselves as risk takers, according to The Sage Business Index.
Risk-taking is becoming more of a common business practice, and for good reason. Without bold decisions, businesses will never make big gains. That’s not to say that cautious planning and careful calculations should be ignored. Indeed, those are essential to any company’s success. But if you don’t aim high, you’ll never truly rise above the competition.
While social consciousness is becoming a trend (stat ups with a social mission have now officially been parodied in pop culture – see HBO’s Silicon Valley), it still looks to many investors like a non-profit in disguise.
There’s enough precedent for investors to take you seriously, but still enough of a challenge to make the idea of a socially-aware business a true risk. But with a solid business plan to back you up, it’s a risk worth taking.
Tie social responsibility to good business
Speaking of solid business plans, social entrepreneurs, like everyone else, can’t survive without one. Your passion for building schools in Africa alone can’t sustain your company.
When seeking investment, it’s imperative to find backers who share your goals. They should understand that your mission may not resemble that of traditional businesses. In other words, the return on investment may take a little longer, the end game is not only about profits, etc.
Fortunately, even big companies are starting to devote themselves to social responsibility, which should benefit the small guy. In the past few years, $170 billion asset manager Carlyle Group appointed its first Chief Sustainability Officer; meanwhile Goldman Sachs and Morgan Stanley have established sustainable and social impact investment funds.
Meet market demand
While socially conscious entrepreneurs are finding under-served areas to address, they’re also answering the demand of consumers. There now exists a gap in the market for companies that offer more natural food and environmentally friendly products.
From non-toxic detergents to energy-efficient light bulbs, fair-trade coffee and more, some people want to support socially minded companies. In fact, they’d much rather buy from them than their competitors, and many consumers are even willing to pay more.
Percentage of people polled who spent more on socially responsible products in the past 6 months (source).
While the government is increasingly establishing guidelines for less wasteful products and services, there’s an organic need for these items as well. Savvy entrepreneurs are simply meeting the demand.
Use creativity to solve problems
Because entrepreneurs build from the ground up, creativity is a must. You’re not going to change the world (and likely won’t secure investment) if you simply reiterate what another business has done, even if it was done successfully.
When it comes to social business, creativity plays an especially important role. As pointed out here, some environmental problems persist because there doesn’t seem to be any money to be made in fixing them.
However, rather than focusing on consumers, entrepreneurs should also consider achieving socially responsible goals by helping other businesses. In that same environmental scenario (and same article), a technologically savvy business owner could create software that runs calculations to help dirty factories improve efficiency while cutting pollution.
Your cause may be clear-cut, but the solution often takes some outside-the-box thinking in order to address it in a way that’s socially conscious and financially sound.
Everyone can share the social spirit
You don’t have to be a social entrepreneur to operate like one. Even if you already run a business, you can still contribute to important causes. True, this isn’t exactly the same as building your company around a social mission, but contributions always help.
Another option is to microfinance native entrepreneurs in poor and developing countries. Whether you’re simply helping buying supplies or contributing to the building of schools and dams, your impact will be meaningful.
And of course, the added advantage here is that it can help your business, as people like to patronize socially responsible companies if given the option.
(And remember, every entrepreneur needs a good digital marketing strategy. Contact SPINX Digital today to see how we can spread your small business’s message online).