Identifying Key Factors in Scaling Social Enterprises, #GES2016
Diverse capital, media savvy, and a flexible supply chain are among the top factors in whether a social enterprise will successfully scale its impact. These findings were from an analysis of social startups affiliated with UC Berkeley.
Dr. Laura Tyson, Berkeley-Haas professor and Director of the Institute for Business and Social Impact, shared these findings during the “Passion, People, and Profit” training session at the Global Entrepreneurship Summit 2016.
When a new enterprise does all three right, it creates a virtuous cycle, allowing it to grow its people, revenue, unit deployment, and its impact more quickly.
Accessing Financial Capital
Successful social startups are very adept in getting many forms of capital: grants, traditional venture capital, government funding, and social venture capital. UC Berkeley’s Blum Center for Developing Economies and the federal government’s USAID program are examples of resources designed to accelerate startup growth from the lab to the marketplace.
Using Media Savvy
Social startups that were “media savvy” won instant credibility online. A strong online presence created a tipping point, helping them secure early suppliers and distributors, as well as early funders. While the type of media and its distribution might differ, country to country, there is no doubt that establishing early credibility are important for all social entrepreneurs.
Strong and Flexible Supply Chains
These startups were also “scrappy” in establishing their first supplier and distributor relationships, and often found that this was a key area of continuous innovation. As their products changed, so did their supply chains, driving improvement in both efficiency and cost.
The corporate form of social enterprises is also an important factor — if not in the top three. Whether a new enterprise uses a nonprofit, for-profit, or hybrid form, it must be attuned to stakeholder needs, capital needs, and often the “culture” or “values” of the social startups’ founders.
Dr. Tyson’s remarks were based on a study she conducted along with Dr. Jennifer Walske, a Haas Social Impact Fellow and Program Director of the Conscious Leadership and Social Innovation program at the University of San Francisco.
More details and example case studies may be found in the Haas Institute for Business and Social Impact’s three-part series: Raising Capital, Media Savvy, and Supply & Distribution.
Information on the Global Entrepreneurship Summit, agendas, videos and other links are at www.ges2016.org
