In these days of “never enough donor money” social enterprises can be an important source of financial support and sustainability for nonprofit organizations.
We support that. In fact, we have funded more than 15 of these organizations. (You’ll find examples of that throughout this website.) In doing so, we’ve developed some important guidelines for deciding what is fundable:
- The idea must originate with the nonprofit organization. They must “own it.”
- They must have the skills to successfully operate the enterprise,
- We need to receive a persuasive business plan (described below).
- All the proceeds from the enterprise must go directly to support the organization’s mission,
- And, it must not detract from their abilities to fulfill their primary mission.
Business Planning 101
Creating a suitable business plan is not an onerous task. Our SE Asia Foundation version of a fundable business plan contains just five critically important elements:
- The Story: Tell us about the business you wish to start and why you think you can make money with it. (Make sure this is brief and concise – a half page or less.)
- The Leader: Tell us about the person that is so knowledgeable, and so committed to this idea, that this business cannot possibly fail.
- Start-up Budget: Show us how much money is required before the first business transaction can be made.
- Operating Budget: Prepare a spreadsheet showing good faith estimates of revenue and expenses for at least the first year. Longer than one year is okay also.
- SWOT Analysis: Prepare a SWOT* analysis, including your plans for addressing the important concerns identified.
* Strengths, Weaknesses, Opportunities, Threats