Transcript HUD Social Enterprise Pilot
Strategies for Selecting Social Enterprise Ideas
© 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Idea Creation & Development
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Finding Enterprise Ideas
Brainstorming Market Failure SWOT Analysis Serendipity Mission
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Asset Leverage
The Inception of the Social Enterprise Idea is Driven by Social Concern, Rather than Financial or Market Opportunities
The social problem IS the business opportunity © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
What is the social problem you are trying to solve?
What are the social impact you are trying to create?
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Role of Client
Client Producer Client Worker
Social Enterprise
Client Consumer
Market
Client Community Environment Public
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Client Beneficiary
Mission Cohesion
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Strengthen Mission
Women’s economic development organization supports self-employed single mothers through small business consulting services. Social Enterprise opens a sliding-scale fee-based childcare social enterprise to enable clients more time to focus on their business.
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Leverage Mission
Organization: Global Exchange International human rights organization dedicated to promoting social, economic and environmental justice around the world.
SE: Reality Tours Raise public awareness of root causes of injustice through themed “reality trips”—i.e. fair trade, civil rights, peace and conflict, sustainability and the environment, climate change, etc.
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Expand or Enhance Mission (1)
Commercialize social services in new paying markets / clients
Organization: Senior services
Full adult daycare services for indigent frail seniors.
SE: Premium Eldercare
Premium eldercare and family support service for pay market. © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Expand or Enhance Mission (2) Sells new social services to existing markets / clients
Organization: Grameen Bank Microfinance organization that makes micro-loans to poor entrepreneurs in Bangladesh SE: Grameen Phone Sells cell phone time to Grameen Bank clients; micro-entrepreneurs (clients) work as sales agents © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Supply Chain Integration
Procuring Supplies Employing Workers Designing Product or Service Producing Product or Service Marketing to Target Fair Trade Dis enfranchised Groups Delivering Education Green Techniques Micro finance Adapted from Dees (2002) © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Via Services & Markets
Market Existing Services Existing Market New Services Existing Market
(Quantity / Breadth) (Diversify service)
Existing Services New Market
(Diversify community expand geography)
New Services New Market
(Diversify service and geography) © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Service
SWOT
Competition Opportunities Threats Strengths Collaboration
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Weaknesses
Identifying Assets
Tangible and Intangible Assets © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Assets
TANGIBLE ASSETS
Staff and Volunteers Membership Equipment or machinery Building/physical space Money
INTANGIBLE ASSETS
Skills or experience Good community relations Recognized logo Political connections Strong public image Influential board of directors Unique methodology or content © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
© Community Wealth Ventures 2001
Examples of Leveraged Assets (1)
PRODUCT
Zookeepers in Thailand turned their Elephant dung into lucrative handmade paper products The National Zoo (Washington DC) sells “Zoo Doo” exotic fertilizer
AN ASSEMBLED MARKET
A national youth organization discovered that its target group was valuable to large advertisers and assembled focus groups and market research studies for major companies.
SPECIALIZED EXPERTISE
Following 911 a grief and loss organization experienced high demand for its specialized grief counseling services and won contracts with NY and DC local gov’t and the US military. © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Examples of Leveraged Assets (2)
LOGO AND REPUTATION
Save the Children licenses it logo for a fee to clothing companies to sell ties and scarves.
PHYSICAL ASSETS
Churches in New England discovered that their steeples made ideal antennas for mobile communication companies, and converted historic beauty into money. © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Identifying Your Assets
1.
2.
3.
4.
People
• What people do you have that are
particularly
valuable to your organization? (name recognition, skill sets, etc) 1.
2.
3.
4.
Skills/expertise
• What kinds of skills and expertise do your staff have? What about the Advisory Board? Volunteers?
Audience/special relationships
• What are the key strengths of your audience (e.g.., size, demographics, psychographics, loyalty, etc). What other key relationships do you have?
1.
2.
3.
4.
Tangible assets/facilities
• What do you own or have the right to use? Real estate? Program related equipment? Collections, stock, materials? 1.
2.
3.
4.
Programs/proprietary content/events
• What are the key programs or content that you have at your disposal? 1.
2.
3.
4.
Reputation
• 1.
2.
What does your name mean in the community? To whom?
Other
1.
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© Community Wealth Ventures 2001
Prioritizing Opportunities
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Narrowing the List
Mission Social criteria Financial criteria Assets and resources Market information Operating environment Organizational factors Stakeholders Preferences © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
The Mission is the Anchor
To Vision Unrelated Opportunity
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Mission Cohesion
The Organization - “dedicated to enabling older people to live with dignity and independence. Through its professional staff, corps of volunteers, and close collaboration with other organizations, IONA Senior Services provides services and access to programs designed to meet the needs of seniors and their families.”
The Enterprise - “to provide families premium quality eldercare services with compassion and integrity. By meeting the needs of an affluent target market, Essential Eldercare will generate excess revenue and capacity to serve more economically and socially disadvantaged frail seniors.”
© 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Social Criteria
Special considerations or attributes required to achieve social impact objectives Social Criteria often hinges on special needs or limitations of clients and/or beneficiaries Social Criteria impacts ideas, choice and type of enterprise © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Social Criteria
Business Venture Idea Evaluation Form Criteria
Range of skill requirements – mostly low skill jobs Range of full time and part time jobs – mostly part time Variety of tasks High proportion of repetitive, predictable tasks Environment that management can control Daylight-hours jobs Monday through Saturday Organized as supervised team/crew work Room for quality checks and controls – time to correct for mistakes Minimal deadline stress
-2 Venture Idea
(Rate according to ability to fulfill criteria)
-1 (Definitely will not meet criteria) 0 +1 +2 (Definitely will meet criteria)
Janitorial Services +2 +2 +2 +2 +2 +1 +1 +2 +2 Assembly Business +1 +2 0 +2 +2 +2 +2 +2 +1 Laundry Services +2 +2 +1 +2 +2 +2 +1 +2 +1 Restaurant +1 +2 +2 -1 -1 0 0 0 -2 +2 0 +1 -2 Minimal seasonal layoffs Leads to living wage work +2 +2 0 0 +1 +1 0 0
Total Score:
+22 +14 +18 -1 © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Commercial Copy +2 +2 +1 +2 +2 +1 +1 +2 +1 0 +1 +1 +16 Commercial Bakery 0 0 +2 +1 +1 0 +1 0 0 0 -1 +2 +6
Social Criteria: Refugee Example
Profile Financial Services
Demographics Economically active Weak social ties Vulnerable Grants and training before loans Monitoring Few assets Inability to repay Psychographics Mentoring Certificates – credit rating Transient Risk adverse Support to start up micro businesses Extra burdens Transparent processes Geographic Refugee camps Poor or degraded market & infrastructure Continue service Branding © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Financial Criteria (1)
Start up costs Amount organization can invest Operational funding Maximum $$ org can subsidize venture Duration can subsidize Breakeven requirement © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Financial Criteria (2)
Income/Revenue Amount of revenue contributed to parent organization % of shared fixed costs covered Amount of social/program costs covered Financial opportunities New sources of funding Unrestricted funding Leverage © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Resources (Assets)
Tangible People Land Money Intangible Reputation / brand Methodologies IP Relationships Skills and expertise © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Market Potential
Market size, growth and trends Demand Industry dynamics Opportunities & Barriers Ease of entry (regulatory, legal, etc.) Income potential Competitive environment External environmental factors © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Social Market Potential
“Beneficiaries” of impact Client Community Environment PR Competitors Role of subsidies in the market Collaborators Strategic alliances and partners © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Organizational Factors
Core competencies Capacity Human Resources Financial Stakeholder buy-in Risk Profile Preferences Competitive advantages Culture © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Preferences…
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Don’t underestimate the power of preferences
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Intuition
Gut Check Is this how we want to spend our time?
Are there better things we could invest our time and money in? © 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Idea Evaluation
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Scoring Opportunities
Opportunity Enterprise idea Fit with Mission Fit with Social Criteria Fit with Organization Strengths & culture & Risk Profile Fit with Assets Fit with financial criteria Market Potential Ease of implement ation
© 2007 Virtue Ventures LLC. Licensed under a Creative Commons Attribution-Share Alike 3.0 License.