So You Want to Start a Social Enterprise? (Part 2)

Flywheel Social Enterprise Hub’s three-part blog series, So You Want to Start a Social Enterprise, will walk you through the formation of a social enterprise through a legal lens. Produced in partnership with Northern Kentucky University’s Chase College of Law, the series will answer questions about general legal structure, funding, and scaling your business.

Part II: Ground Floor. Going UP…!


Once you understand the basics of structuring your social enterprise, it’s time to starting thinking about how to build and scale your venture. Here are some tips to take you from starting up to growing up.


  1. Relentlessly focus on your business plan.

We like to say that social enterprises are “businesses where society profits.” It’s no coincidence that we use the word ‘business’ first. Ask any successful social entrepreneur, and you will hear that social enterprises are businesses first. So, it is important to have a business plan in place. This will matter whether you are a for-profit (investors will invariably ask to see your business plan) or a non-profit (your donors will have lots of choices of what to support – so you’ll want to give them the confidence that your enterprise will be around to make an impact for years to come). In short, your commercial viability is as important as your social purpose. Make sure you have a sound business plan in place that has all the critical elements.


Although it can be long or short, formal or informal, your business plan should include an executive summary of your enterprise; a description of your business; a compelling articulation of your service offering; an impactful marketing plan; a core strategy; and financial projections. A good resource to help you prepare a business plan is Business Model Generation by Alexander Osterwalder and Yves Pigneur.


  1. Understand how to measure your impact.

Richard Branson, founder of Virgin Group, famously said “If you aren’t making a difference in other people’s lives, you shouldn’t be in business – it’s that simple.” The question to be answered, then, is what difference are you making? And how are you measuring the impact? We will come back to the importance of this concept in the third installment of this blog series. However, the ability to scale your social enterprise requires that you identify a problem that you are passionate about solving, make sure you have a workable solution that solves the problem, and have a way to measure the impact of your work.


  1. Address the basic legal considerations

Early in the process of building and scaling your social enterprise, you will want to consider some of the basic legal elements necessary to protect your interests. This includes developing: confidentiality agreements with employees, volunteers, suppliers and partners; non-compete agreements to protect your legitimate business interests, including any trade secrets you may have; and trademark (or in some cases, patent or copyright) protection.


  1. Be humble enough to accept that you probably can’t do it alone.

At some point, if your business plan is working and your enterprise is growing, you will need to think about expanding your team. The right core team can be a growth catalyst to help you on your way. Consider a list of specific individuals or specific characteristics you need in an individual that will be required as your enterprise grows. Since your business plan will ideally look out 24-48 months, you should be able to approximate each stage of your growth where you may need to bring on additional resources.


  1. Consider a partner strategy.

One of the fastest ways to scale up a social enterprise is by joining forces with a partner – usually an existing business or organization. Partners can provide access to new markets and opportunities, and the right partner will generally have a shared view of your social purpose. Additionally, entering into a partnership – especially in the early years – can minimize risk and avoid having you spread yourself or the enterprise too thinly in the interest of scale.


  1. Innovate and adapt – because the world moves fast.

There is a famous executive coach named Marshall Goldsmith. He wrote a book called “What Got You Here Won’t Get You There.” The premise is that in order to keep progressing, it is important for leaders to constantly adapt. The same concept holds true for growing a business, including a social enterprise. Trying to grow while assuming you can operate in the same way often impedes growth.


In the next installment, we will share our perspective on how to generate funding to continue growing your social enterprise. In the meantime, good luck – we’re here to help.

Produced in partnership with:

The Small Business & Nonprofit Law Clinic at Northern Kentucky University’s Chase College of Law provides free legal services to entrepreneurs, small businesses, and nonprofit entities in the local northern Kentucky-Southwest Ohio community who could not otherwise afford access to quality legal representation. Staffed by law students, it gives those student the opportunity to provide legal services to real clients under the supervision of an experienced supervisor. In its first five years, the Small Business & Nonprofit Law Clinic prepared 65 students for the practice of law and provided over 7,000 hours of free legal services to over 160 clients.


Professor Barbara Wagner is the Director of the Clinic. As Director, she helps students acquire the hands-on practical skills necessary to succeed in corporate and transactional work. Before joining the Chase faculty, Wagner practiced law for over 30 years at major law firms and inhouse, in areas including corporate, securities, finance, governance, compliance and other transactional law areas. Wagner is admitted to practice in New York, Ohio and Kentucky, and is a member of the American, Kentucky, Cincinnati and Northern Kentucky Bar Associations, as well as the Society of Corporate Secretaries and Governance Professionals and the Ethics and Compliance Officer Association. She earned her BA at Yale University, an MSBA from Boston University and her JD from Columbia University.

Craig Buchholz has more than 20 years of experience in marketing, public relations and communications. He currently leads the Global Communications organization at P&G where he serves as a key advisor to P&G senior leadership. He is responsible for developing and directing an overall strategic communications plan that fosters favorable perceptions of P&G, its products, its services, and its people. In May 2017, Craig received his J.D. from The Thomas R. Kline School of Law at Drexel University in Philadelphia; he participated in the Small Business & Nonprofit Law Clinic during spring 2017 as he completed his studies to support local entrepreneurs and growing non-profit organizations in a hands-on and practical fashion.

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