Building a Social Enterprise: 3 Things to Consider Before You Start
Starting a social enterprise is one of the most meaningful ways to build a business. Although being a “social enterprise” doesn’t have an exact definition or certification they generally all seek to achieve a social, cultural and/or environmental mission alongside their revenue. The social enterprise goal is not to maximize shareholder value but rather to reinvest their profits to maximize impact while operating sustainably. Some organizations like B Corp, Fair Trade Federation and Buy Social are creating a framework for what it means to be a business-for-good social enterprise and are good places to look when considering certifications for your company.
I have worked with social enterprise businesses since 2013. From managing B Corp marketing plans to serving on a board of a nonprofit looking to create sustainable business strategies, to starting my own socially-conscious company I spend about 50% of my brain power focusing on making businesses more sustainable for the planet and their people. The other 50% of that brain power goes into marketing these enterprises so that they become successful and fully functioning profitable businesses that continues to build great products, services or experiences. This allows them to keep doing good long term.
Profits aren’t inherently bad. They keep our businesses going. But when the sole purpose of business is to maximize profits for a few, at the expense of the planet, the employees and the greater ecosystem, that’s when we have problems. We’re already seeing the longterm affects of this on our planet.
While the idea of building a business while doing good sounds simple, it actually comes with layers of complexity that traditional startups don’t always face. Before you dive into a socially responsible entrepreneurial journey, here are three key things to consider.
1. Think Beyond Intent—Consider Long-Term Impact
Having good intentions is a wonderful place to start—but it’s not enough. Many well-meaning entrepreneurs dive into social impact work without fully understanding the communities they hope to serve, unintentionally causing harm or duplicating efforts that already exist. Before launching, ask yourself: What are the long-term outcomes of this work? Who might be affected in ways I haven't considered? Do I have the lived experience to understand the impacts firsthand?
Unintended consequences—like undermining existing grassroots organizations or creating dependency—can happen when decisions are made without deep knowledge or local relationships. That’s why it’s essential to take the time to listen, research, and build with—not for—the communities or causes you want to support. Social impact isn’t something you tack on; it’s something you build in, thoughtfully and responsibly.
An example of potential unintended consequences I have seen firsthand was in Kenya, when I was working with a Kenyan nonprofit in primary schools. I lived in the community and knew the children and families well. We’d run along the red clay dirt roads playing amongst the maize and tea fields after school. I’d be in my sandals and the children barefoot. The children had built up incredible foot dexterity and their skin formed protective layers over the years of running around outside. Some had shoes they wore, some didn’t, some had shoes and chose not to wear. One day a truck came and delivered several hundred pairs of Tom’s shoes to a different school up the road. This was 2013 and the Tom’s buy one-gift one model was all the rage in the States and I was seeing the “gift one” first hand. As I saw the children run down the path to show me their shoes I thought about the lasting impact of this shoe drop-off. What would happen if the kids wore those shoes for a year? I thought of those protective layers of skin starting to soften with time, their feet becoming more vulnerable to the rocky roads. I thought about how children grow like weeds and how they wouldn’t fit them for much more than that year. I thought of the implications on a young child’s mind, to be given a pair of shoes from a stranger must mean they lacked them to begin with. I thought about the many businesses at the market selling shoes and how this may impact the local economy.
I thought of the well meaning people back in the States buying these shoes thinking it was their good dead for the day - not realizing the impact might be mute or stunt local economies. These are the questions we have to ask ourselves when wanting to create actual impact. Tom’s started asking themselves these questions too because they have forgone the “buy one, give one” model in exchange for donating 1/3 of their profits to local grassroots organizations (source) making change in three specific issues: promoting mental health, increasing access to opportunity and ending gun violence (source).
In summary - ask yourselves long term questions. Who is benefiting the most? Who is involved in making the decisions and seeing through the solutions? Who is at the table having the conversations? If it’s only you….it’s likely not real impact.
2. The Importance of Partnerships in Social Enterprises
Because of the intricacies of social enterprise - it is important to consider a partner in your endeavor. While many entrepreneurs begin solo, it’s worth asking early on: Should I partner with an existing organization? Collaborating with nonprofits, other social ventures, or value-aligned for-profits can amplify your impact and increase your credibility, especially if they can provide key insight or lived experience in the areas you hope to create impact in.
Strategic partnerships can help you avoid reinventing the wheel, pool resources, gain insight, and build trust with the community more quickly. Whether it’s co-creating programs, sharing distribution channels, or collaborating on storytelling—partnerships can be one of the most powerful ways to ensure your idea will have grounded and deep roots with wide outstretching impact.
In 2016 I worked as the Marketing Coordinator for Raven + Lily, an ethical fashion company that designs clothing, jewelry and accessories and work closely with artisan women from around the world in their production. Instead of reinventing the wheel in every country they wanted to source products from - the founder worked alongside existing nonprofits or businesses already employing an empowering a workforce of women. The nonprofits or organizations would train and employee women on respective artisan skills. From Maasai beading in Kenya to traditional weaving techniques in Guatemala and candle making in Los Angeles. The partners were able to focus on job training and skill sharing with deep grassroots understanding. The role of Raven + Lily was then able to come alongside these organizations by purchasing artisanal handmade goods which allowed them to sustain and grow their organizations.
The best organizations know they are stronger together and blind spots are better seen surrounded by like-minded organizations.
3. Don’t Just Measure Money—Measure Meaning
In a traditional business, metrics like revenue and profit are king. But in a social enterprise, the real question is: Are you making an impact on the planet, it’s people and the ecosystems they are a part of ? Before you launch, consider how you'll measure your mission—not just with your margins. What will success actually look like beyond income? What do these measurables look like?
This might mean tracking things like waste diverted, mouths fed, stories amplified, forests cleaned, policies reformed, lives saved. It could also involve more qualitative feedback: trust built, narratives shifted, or access improved. Whatever your mission, find meaningful ways to measure progress that reflect the true spirit of your enterprise. It will not only help you stay aligned—it will help your customers, funders, and collaborators understand and support your work more fully.
Pivoting the mindset from profits to the people, planet and ecosystems we’re a part of can be difficult in a capital-focused economy. But it’s possible and most importantly, it’s powerful.
More powerful than profits because the most precious things of value on this planet are the people and the places we exist.
Final Thoughts on Social Enterprise Development
Building a social enterprise requires heart, strategy, and community. It’s a wild path but if you take the time to plan well, partner wisely, and measure what matters you’ll be on your way to creating lasting impact. When done with care, social enterprises have the power to not only create change—but to change the way we think about business altogether.
If you have a business you want to pivot into a social enterprise, or a mission-driven idea you want to get started - let’s chat. Book your free espresso-sized consult to get started on your social enterprise with a partner on your team who knows the questions to ask and the places to start.
