A. SECURING PARTNERS & SPONSORS

How will our change agents find partners and sponsors to support their social enterprises? And for the ones that have successfully done so in the past, how can they move on to bigger, more significant partnerships? Generally speaking, big or small, the same principles apply – They’ll need to reach out to potential supporters who share their values and goals.

Research is key. What kinds of individuals, foundations, corporations, or government agencies are likely to support the agents’ particular enterprises based on their current interests, motivations and requirements? Our agents must ensure that they adapt their outreach to the different groups accordingly.

They must be specific and realistic about what they ask for – whether money, coverage or in-kind donations. How much do they need exactly? Why that much at this point in time? Why have they reached out to this particular individual or organisation?

And how can our agents frame their offers for partnership or sponsorship to show that their potential collaborators will also benefit? Is their enterprise area of focus a trending topic in the news perhaps? Or maybe their business is taking off among young people and so aligning with them will score their collaborators points with the youth market they have been looking to break into.

B. SECURING INVESTORS

In terms of securing investments, once it’s time to level up from freebies given by family and friends, securing funding for impact-driven enterprises can be difficult because of the need to balance social ambition with financial reality.

One of the biggest challenges social enterprises face is lack of access to capital. Traditional investors (like angel investors or venture capitalists) are, on the whole, less inclined to invest in such businesses because of their perceived high risk, as social entrepreneurs are often trying to solve problems that don’t have easy solutions and typically work in areas that are underserved, such as poor or rural communities. Impact investors, who actually count social impact as part of their ROI (return on investment), may be the solution, but for now they are fewer and further between.

In order to impress potential investors, among other things, the change agents will need to communicate a clear understanding of the needs and wants of their target demographic; explain their businesses’ USP (unique selling point) and how that solves the identified social problem; demonstrate exactly how they plan to use the requested investment; and break down thorough, realistic financials that project how the business will make money and grow over time.

They must understand all the risks involved with their business (such as legal, technological, regulatory or product liability risks) and be prepared to answer tough questions about how they plan to mitigate those risks.

And something that might surprise young entrepreneurs is how much importance investors place on them as people. Many investors closely assess a founder’s character – Are they passionate and determined? Will they be trustworthy and enjoyable to work with? Investors want to see that their funding goes to a start-up with a solid, cohesive team that works well together.