A new chapter

After eight guilty months, this Thanksgiving I finally made the time to start publishing content  I had collected and written up in March of this year during my trip to Australia. I used the early morning hours to nurse a cup of coffee (or three) and start editing posts that had sat silently in their folders for way too long. And as I was reading through all the background research and interviews that I had done for each visit, I got genuinely re-excited about all the knowledge, connections and experiences I collected over the last two years of working on Social Venturers! I was overcome by a sense of elation and gratitude as I reflected on the great conversations I had on my most recent trip to Australia alone:

I spoke with Kaitlin Tait – Co-Founder of Spark* International – in a cozy social enterprise cafe in Richmond, Melbourne, about their journey from Tanzania via Cambridge to Papua New Guinea and Australia.

I spent one late afternoon at The Difference Incubator in Melbourne discussing the next big thing for the social enterprise sector, vehemently nodding my head in agreement with Isaac Jeffries thinking to myself “These Australians really get it!”.

Another time I found myself talking to Tom Allen outside the Queensland Library in Brisbane’s tropical sun soaking up every word he said about bringing social entrepreneurship into middle and high school classrooms, all the while filling me in on his international lifestyle and passion for using design thinking for social good.  

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Social enterprise cafe STREAT was founded in 2009 by Rebecca Scott & Kate Barrelle

I have learned so much from Social Venturers in Australia, Europe and the United States, and I can’t thank them enough for making time to critically and openly talk about their programs and share their outlooks on the world of social enterprise at large! With that said it comes as no surprise that I was disappointed with myself for not sharing any of these insights and  experiences until eight months later. It doesn’t look like much on the site itself but it takes about an hour for each post (Spotlight and Field Visit) to be edited for online publication and go live; and it wasn’t even about making the time, it was about everything else that was going on.

Once I received my greencard for the United States in March 2016, I jumped into local work projects with both feet: I ran two rounds of a 12-week pre-accelerator for university students, took on the role as B Keeper for Central Virginia’s B Corp community, launched Virginia’s first social enterprise mini-accelerator in collaboration with Unreasonable Institute, started to advise small businesses and startups with a social mission one-on-one and helped run a co-working space. I joined an incredible network of ecosystem builders called Startup Champions for which I help run communications and outreach, and I supported a local accelerator for high-growth companies as mentor coordinator. I loved every minute of my work locally, and still do, but inevitably Social Venturers was pushed into the background.

This is the moment where I am supposed to say “But that’s all going to change now! Now that I remember how important and invigorating all the research behind Social Venturers is, I will make it a priority and magically fit another five hours into my 50-hour week! Boo-yah!”. I have made these types of commitments before and know It. Doesn’t. Work. As much as I have always enjoyed Social Venturers, the travel, the research, the conversations – right now is not the time.

I have answered many of the questions I had when I launched Social Venturers. I have seen many different support models for social entrepreneurs, not around the world, but at least on three continents. From the very beginning I was very aware of the fact that the landscape of social enterprise support is transient and ever evolving. I never fooled myself into thinking I could capture it all; because “all” will be different a week from today.

My first field visits for Social Venturers took me to Europe in January 2015

My first field visits for Social Venturers took me to Europe in January 2015

Instead of focusing my efforts on the big questions, I have shifted my attention on social enterprise support in mid-market sized cities. When life dropped me off in Richmond, Virginia, I declared it a testing ground for social enterprise support in mid-tier cities. Having learned so much about support models in metropolitan areas like Berlin, London, Amsterdam, New York City, and Melbourne, I became more and more curious about the power, opportunities and challenges of social entrepreneurship in smaller places with less awareness and infrastructure for these type of changemakers.

In September 2016, I launched Unreasonable Lab Virginia with a group of startup ninjas, and it gave me some first insights into the differences for social enterprise support between large, established ecosystems and emerging ones (Read more about early lessons, our definition of success and next steps!). It is a first step into a new direction for Social Venturers. Not only do I get to apply everything I learned from other support organizations in different countries, I am also expanding my toolbox venturing into the world of B Corps, honing my skills in startup acceleration and community building, and growing the foundation of Social Venturers. All in all, a pretty exciting prospect for 2017!

Join me on my journey! If we have not met yet, drop me a line to anika@socialventurers.com! If we have met, let’s catch up for coffee again next time I’m back in your neck of the woods (Germany and Australia are coming up!). If you know of a social enterprise support program that I could learn from, especially but not exclusively in mid-tier cities, I want to be in the know! Let’s connect via Twitter or LinkedIn. Stay in touch and stay critical.  

Spotlight: Mark Hemetsberger

mark-long

What drives you?

Feeling like you are achieving something that is bigger than you.

How do you define social entrepreneurship?

Social entrepreneurs are people that are socially minded, want to make difference and start a business to achieve that impact.

Biggest SocEnt trend you have seen in the last 5 years?

Recognition. Awareness and visibility have increased over the last years but we have a long way to go. Having national activities and research helps. Most Social entrepreneurs still don’t identify as such – the sector needs to recognize itself.

Background

 

I’ve always had a strong sense for social justice and the power of markets. I was lucky to have a strong mentor in my first job who was generous with his time and knew what I needed to do. We found a great way to do that collaboratively.  I went from selling paintball in London in my mid-twenties to working for the Commonwealth Business Council in London, UK. I returned to Australia and started working with the Australian Broadcasting Organization – ABC – which came with a lot of international travel. I got to work at the crossroads of culture and media which really helped me understand how content works in an authentic sense – not just as a tool for marketing.  In 2015, I joined Social Traders as the Head of Marketing and haven’t looked back!

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@MarkHBerger

Spotlight: Isaac Jeffries

isaac-long

What drives you?

My belief that you can solve tough social problems by running a business.

How do you define social entrepreneurship?

Running a business that can make a positive difference to a social issue. You don’t simply give away profits, your business needs to do good to do well. If in the process of manufacturing a boring product, you employ the homeless, long-term unemployed, indigenous communities, asylum seekers – that’s great. Even if you don’t make a profit one year, you are still doing good!

Biggest SocEnt trend you have seen in the last 5 years?

The push towards scale and investment. A few years ago it was all about grants, now everybody wants to meet investors. Investors, on the other hand, say there isn’t enough deal flow. The truth probably lies somewhere in between; we need more communication and to manage expectations.

Background

I started my business at 12 and ran it for 6 years. We were the competitor to our high school canteen: they were charging AUS$1.20 for cans of soft drink and were only open on lunch break.

My friend and I decided that we could beat that, so set up our own shop, and ended up building a bigger business than our rivals.

Towards the end of school, I realised that I loved the business world, and wanted to get a business degree. At ANZ (Australia New Zealand Bank) I did paid internship and worked in strategy. After that was over, I changed my co-major to entrepreneurship, as part of which I took some courses in social entrepreneurship. After uni, I went and worked in community housing and was in charge of the finance of day-to-day operations (payroll, etc.). I met TDi’s founders Bessi Graham and Paul Steel  just before they launched TDi. I the meantime I took a few other jobs in tech startups and when they launched TDI, I joined the team as their first employee.

In three years at TDi I’ve personally worked with over 150 enterprises across Australia, and have had the chance to travel to India, Singapore and the USA.

Now I’m also working at Business For Development, where I am designing and building a social enterprise in Papua New Guinea.


Since our interview in March 2016, Isaac has moved on to Business for Development where he works as Financial Analyst. Make sure to check out his blog where he shares his insights from the field. Great stuff!

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@isaacjeffries

Isaacjeffries.com

Social Traders

I kicked off my second week in Australia with an event at the Melbourne Accelerator Program’s Compass where Mark Daniels from Social Traders spoke about Social Entrepreneurship in Australia. Leading up to my trip downunder I researched the sector online and the best (and only) resources I came across was published my Social Traders (check out their report Finding Australia’s Social Enterprise Sector).

That night, I got a pretty good insight into the developments and state of social entrepreneurship in Australia, and learned more about Social Traders which Mark had co-founded several years earlier. A few days later I met up with Mark Hemetsberger to talk learn more about their programs.

Let’s start with Social Traders’ definition of social enterprise: “Social enterprises

  • Are led by an economic, social, cultural, or environmental mission consistent with a public or community benefit
  • Trade to fulfill their mission
  • Reinvest the majority of their profit/surplus in the fulfillment of their mission.”
The spectrum of social enterprise, copyright: Social Traders

The spectrum of social enterprise, copyright: Social Traders

Mark introduced me to Social Traders as a “full-service organization that offers

  • Enterprise development,
  • A portfolio that invests in social entrepreneurs,
  • New market opportunities (social procurement), and
  • Advocacy and leadership in the social enterprise sector (lobbying and advocating)”

More broadly speaking, their objectives are to

  1. Grow the visibility, voice and value of social enterprise
  2. Build the pipeline of innovative and viable social enterprise
  3. Open new government and corporate markets

Let’s dig a little deeper into what that actually looks like.

Services

Social Traders strive to achieve these objectives through a multitude of services designed to build sustainable social enterprises. They run everything from a half-day workshop on social entrepreneurship to 4-months market validation programs, through the Crunch. Social Traders also is the organizer of Australia’s Social Enterprise Awards, Social Enterprise Masters Conference and  initiated the Good Gift Campaign in 2012 – which has now morphed into a dedicated social enterprise online marketplace called Good Spender – as well as promotes social procurement among Australian consumers, corporations and government.  

Let's talk about social enterprise

Let’s talk about social enterprise

Crunch

The Crunch is Social Traders’ capacity building programs for social entrepreneurs at different stages of the process. Crunch for early-stage founders is a 4-month long acceleration program delivered through workshops, group sessions, mentoring and online learning. It aims to help startups design, test and pilot potential solutions for social issues while polishing their business skills and providing access to a community of business, investment and social enterprise professionals, and offering the opportunity to pitch their ventures in front of investors at the end of the program. With a similar set-up as the early-stage program (2 days/week, workshops, group sessions, online learning & mentoring), a second Crunch program focuses on the needs of later-stage social entrepreneurs (due diligence, network access). Crunch Market Access is designed to assist social entrepreneurs looking for investment and access to new markets and customers. Learn more about Crunch in this video.

How Crunch works

How Crunch works

Portfolio

Social Traders second area of activity focuses on the provision of appropriate capital. Social Traders’ Social Investment Portfolio provides a source of patient capital and support for social enterprises that would otherwise find it difficult to secure investment from other sources

Social Traders’ Portfolio provides business advice and appropriate capital to high potential, charitable social enterprises.

The support provided includes business coaching, financial monitoring, sales coaching and access to networks, workshops and events. The Portfolio offers capital to selected social enterprises as grant and patient loan hybrids with business support and advice over 5-7 years.  More information on Social Traders’ Portfolio is available here.

Social Traders has very strong views on the type of capital that is available and provided to social enterprises.  A fantastic article written by the Head of Advisory & Investment, Libby Ward-Christie is available here.

Connect: Social Procurement

Social Traders third large area of activity focuses on developing new markets by promoting social procurement with corporates, the government and the Australian consumer (watch Buy Social – It’s a no brainer). Through Social Traders’ Connect, companies and government institutions have access to a network of certified (!) social enterprises throughout Australia. Social Traders assists in social impact evaluation and reporting of procurement contracts, benchmarking and internal communication, thought leadership and networking for social procurers. Check out their case studies on public procurement in Australia as well as their report specific to corporate social procurement. In order to promote social entrepreneurship to Australian consumers, Social Traders partnered up with Australia Post to launch Good Spender – a social enterprise e-commerce platform to buy anything from Mobile Phone Plans that support people with a disability to sustainable apparel and locally produced chocolate, wines, coffee, jams etc.

Good Spender

Good Spender

Like The Difference Incubator, Social Traders charge participants for their programs: AUD $5,000 for the Market Validation and AUD $30,000 for the Market Access program; fully and partially funded spots are available for the latter. Mark Hemetsberger explains: “It is our way of assessing whether or not participants are serious about the program and their ventures, and defines that we are offering something of serious commercial value in the market.”

This was not the last time I would meet this entrepreneurial attitude towards social enterprise support. If you are interested in to learn more about Social Traders, I recommend perusing their website – they have some seriously great resources available!

twitter@SocialTradersAU

socialtraders.com.au

The Difference Incubator

Melbourne’s first social enterprise cafe Kinfolk is located in a beautiful old building from 1891 on the corner of Bourke St and Spencer St. Formerly the headquarters of Melbourne Tramway and Omnibus Company, today donkey wheel house is home to Hub Melbourne, Kinfolk and The Difference Incubator (TDi) – which was one of the interviews I had been looking forward to in Melbourne.

Kinfolk inside donkey wheel house, photo credit: Josie Withers

Kinfolk inside donkey wheel house, photocredit: Josie Withers

I sat down with Isaac Jeffries, who has been part of TDi since day one; time flew by as we chatted about the program (business-driven), social entrepreneurship in Australia (sexy and growing) and his personal background (first-time founder at age 12).

The first thing that stood out to me was that TDi focuses on investable social enterprise instead of “just” social enterprise, the latter being defined as an organisation that makes intentional positive social or environmental impacts using a sustainable business model.

An investable social enterprise, then, is an organisation with a central social or environmental mission, a commercially viable business model, and the right management to deliver on the mission and model.

TDi’s programs focus on leveraging the three key elements: Mission, Model and Management to get a social enterprise ready for investment. Watch this video to learn how founder Bessi Graham and Paul Steele define the term of Investable Social Enterprise.

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Program Structure

TDi offers different services for social entrepreneurs at different stages. The two-day business model workshop builds on the business model canvas for idea-stage as well as established social enterprises – never too late to revisit your basic business model, right?

Two Feet kicked off the day I was visiting. During this 6-month programs founders get together in group sessions every two weeks and have one-on-one mentoring sessions with the TDi team once a month. Topics covered through Two Feet are

  • Intent
  • Value proposition
  • Strategy and Operations including Piloting and Prototyping
  • Branding and Marketing
  • Business Finance
  • Investment 101
  • Designing for Success – Funding and Structuring options
  • Pitching to Investors
  • Theory of Change
  • Social Outcomes measurement
  • Governance
  • Whole of Enterprise reporting.

Other services TDi offers include consulting for social entrepreneurs and an investment readiness program.

Prototyping workshop

Prototyping workshop

Uniqueness

Talking to Isaac I got a good sense for TDi’s approach to service provision in the social sector.

“We have a rule here at TDi: We don’t do anything for free. When people pay for the program, they come early, stay late, ask good questions, and challenge us to make the best possible program. It makes them sophisticated customers, we don’t get away with an average program. Remember that not all entrepreneurs are only just starting out, most of them have some money and consider it part of their startup costs. Very early-stage participants tap into personal savings, crowdfund, and find sponsors.” Isaac explains.

TDi values their program at AUS $15,000 and with the support of their corporate partner National Bank Australia (NAB), the cost comes down to AUS $5,000 per team.

“We wanted to be self-funded within 5 years. Sidney Myer Foundation and Donkey Wheel were our early philanthropic funders, and have been great supporters. In  Year 1 we were 50% self-funded, in year 2 65%, and this year, year 3, we are at 98%. At the end of the day, I believe that support organizations that operate like businesses instead of nonprofits develop better programs.

Business modelling at TDi

Business modelling at TDi

Look at this way: Most social entrepreneurs are not very good at watching their financial metrics. It is our job to eliminate the grant-dependent mindset. In order to do so, we have to show them how it’s done; we have to eat our own cooking.

Ensuring we are doing something that people value keeps us operating like a business. Click To Tweet

We know people value our programs because they are willing to pay for them. Any support organization should ask itself what their value proposition to social entrepreneurs is and how much these founders are willing to pay for it. At TDi, we need to make sure that we are doing something that people value, it keeps us operating like a business.”

I couldn’t have said it better myself.

twitter@difincubator

tdi.org.au

Spark* International

One sunny afternoon in Melbourne, I got off the train in Richmond, Melbourne. Living in Richmond, Virginia, I felt right at home walking down the street to my interview with Kaitlin Tait from Spark* International. I arrived at Feast of Merit – a social enterprise restaurant by Spark’s Partner YGAP – and after double-checking the address realized that this industrial looking cafe was indeed where we were supposed to meet. Instead of the daily special their sidewalk chalk board read “In 2015, YGAP helped 73 impact entrepreneurs measurably improve the lives of 72,232 people.“ The bathroom shelf was stocked with Who Gives a Crap – toilet paper by a Melbourne-based social enterprise producing toilet recycled paper investing 50% of profits into sanitation projects in developing countries. I was excited to say the least!

Talking to Kaitlin Tait from Spark* International at Kinfolk Cafe, Richmond, Melbourne

Talking to Kaitlin Tait from Spark* International at Kinfolk Cafe, Richmond, Melbourne

Program Structure

Spark* International was founded by Kaitlin and Aaron Tait in 2011. Having experienced the need for entrepreneurship training in developing countries and the importance of leveraging local talent, they developed the idea while living in Tanzania and launched their first pilot program in Papua New Guinea in 2011. Programs followed in South Africa (2012), Kenya (2013), Bangladesh and Australia (both 2015). With one full-time manager in each country, they implement their Accelerate – Support – Grow program to “use entrepreneurship to help improve the lives of one million people living in poverty in a significant and measurable way.” (Mission).

  1. Accelerate: 12 successful participants are invited to join a one-week live-in accelerator program during which they
    1. Critically reassess their business models,
    2. Receive business training in areas such as leadership, pitching and fundraising, and
    3. Pitch in front of investors and philanthropists during demo day.
  2. Support: For one year following the accelerator, participants receive support in the form of
    1. Strategic advice
    2. Funding – Spark provides small funds of up to AUS$500 for participants to test new ideas and experiment.
    3. Graphic design
    4. Web design
    5. Impact monitoring
    6. Research assistance
    7. Legal advice to further their ventures.
  1. Grow: Selected participants that have proven their businesses to be viable and scalable can receive investment of up to AUS$25,000 and will benefit from a variety of support services through the Spark team.

Since 2011, Spark* International has supported 225 impact entrepreneurs in 5 countries, 95% of which were still operational one year after completing the program. “Through Spark we want to improve the lives of people who live in poverty. To meet this goal, we look for entrepreneurs who are early in their journey. They have launched a product or service but are usually touching the lives of less than 100 people – that’s the stage at which we can make the most impact. The entrepreneurs we work with are local – ideally born in the country they work in, or have lived there for several years; we know that an in-depth understanding of the context is essential for developing a sustainable solution. We are not interested in flying in outsiders with solutions for Africa for example. As valuable as their experience and background may be, we believe in local capacity building.”, Kaitlin explains.

Creative Fundraising

In 2014, Spark International joined forces with YGAP – an organization that specialises in social enterprise and creative fundraising for social causes abroad. YGAP’s 5Cent campaign collected over 7.9 million 5-cent pieces – un unpopular coin in Australia – the equivalent of AUS$ 396,000. Polished Man raised awareness and funds to fight domestic violence against women and children (read their impact report here). Kinfolk is Melbourne first social enterprise cafe entirely run by volunteers; profits are distributed to project partners. Like Kinfolk, Feast of Merit – where Kaitlin and I met – donates 100% of its profits to project partners.

5 Cent campaign

5 Cent campaign

With their merger, YGAP has channeled its fundraising efforts towards the Spark* Accelerator Program and Spark* entrepreneurs. For example, the proceeds of the 5 Cent campaign go towards Spark* entrepreneurs that work in the field of education, profits from Polished Man directly benefit Spark* entrepreneurs that tackle domestic violence.

I really enjoyed learning more about Spark* International and YGAP’s specialization in creative fundraising, not just because Feat of Merit knows how to make legit coffee. I think most of us agree that social entrepreneurship goes beyond cafes that donate their profits – and that alone I want to see much more of – but leveraging conscious consumerism to channel profits and donations towards impact entrepreneurs around the world is… great! Why don’t we have more of that? If I have the choice of buying my coffee at Starbucks or at a coffee shop that employs up to 45 locals, uses local products and donates 100% of its profits to making a difference in this world, I know where I’m going! This is all by way of saying that social enterprise supporters can get much more creative about raising funds for their operations and portfolio companies.

Polished Man

Polished Man

twitter@SparkINTL

sparkinternational.org

Field Study: Australia

Earlier this year, I had the opportunity to spend two weeks in Australia. Based in Melbourne during fall, I was able to work remotely, relive many Australian experiences from an earlier life (Tim Tams, the best skinny flat white I will ever have, smashed avocado for every breakfast, wild koalas, and many many more). The most exciting part of the trip, however, was diving deep into their social enterprise sector.

Social Enterprises in Australia

Social Enterprises in Australia, FASES 2016, p.10-11

When I lived down-under five years earlier, I had dipped my toes into the space doing some pro-bono project work for Social Ventures Australia in Brisbane. Little did I know how varied and progressive Australia’s support sector for social entrepreneurs had become. The entire stay went by in a blur, between work, a two-day trip to Brisbane (that took me another two days to recover from) and a weekend by the Great Ocean Road, I managed to visit six support organizations and learn how they do things down there.

Social enterprises:

  • Are led by an economic, social, cultural or environmental mission consistent with a public or community benefit
  • Trade to fulfill their mission
  • Derive a substantial portion of their income from trade
  • Reinvest the majority of their profit/surplus in the fulfillment of their mission (FASES 2016, p. 5)

One of these organizations, Social Traders, located in Melbourne is deeply committed to the data behind social enterprise in Australia to inform not only their advocacy work but increase visibility of the sector at large. To get you warmed up for what you are about to learn from all these supporters, here are some highlights from their most recent report Finding Australia’s Social Enterprise Sector Analysis: 2016.

  • SCOPE There are an estimated 20,000 social enterprises operating across all industry sectors 
  • COMPANY SIZE – 73% are small businesses, 23% are medium sized and 4% are large organisations
  • MATURITY – 38% have been in operation for 10 years and 34% in operation for between 2-5 years
  • LEGAL FORM – 33% are incorporated associations, 32% are companies limited by guarantee and 18% are proprietary limited (PTY LTD) companies
  • INDUSTRY – 68% are in the services sector, of which 24% are in retail and 23% in healthcare
  • PURPOSE – 34% exist to create meaningful employment opportunities for people from a specific group, and 34% exist to develop new solutions to social, cultural, economic or environmental problems
  • BENEFICIARIES – 35% target people with disabilities, 33% target young people and 28% target disadvantaged women (FASES 2016, p. 9)

I have devoured both the short version and full report about social enterprise in Australia and I only recommend you do the same! Be sure to check out their advice on policy, ecosystem building, financial and impact measurement tools!  

I can’t wait to got back in 2017!