Fri, 25 September 2015
Welcome to Friday. Last week, I asked you to ask yourself some questions that will help you figure out how you want to fund your social venture. If you missed that, or any other lesson in Social Entrepreneurship 101, you can always click here for the audio lessons.
During the next few weeks, I’m going to walk you through the top resources I know about that are specifically geared toward funding purpose driven startups. These are the organizations that I learned about from talking with hundreds of social entrepreneurs, but there are more popping up every day. Go towww.socialchangenation.com/resources/ for a list that’s constantly updated.
Startup cash for Social Entrepreneurs can be divided into three main categories: crowdfunded cash, venture cash, and fellowships. This week, let's focus on crowdfunding for social entrepreneurs:
If you haven’t heard of crowdfunding before, it’s essentially a social network for raising cash. People post profiles about different projects they want to fund, from businesses to charitable endeavors, and other parties give money to the project. Oftentimes, the ‘donors’ are giving this cash in exchange for gifts. For example, let’s say you wanted to crowdfund your first product. You could create a profile, share your story, your purpose, and ask people to contribute in exchange for being the first group to benefit from your product/service.
Let’s check out the top resources:
1.) Indiegogo – This is one of the most well-known and well trafficked crowdfunding platforms. It’s also known for being more ‘cause’ focused, making it a natural fit for those of us in cause based business. Hostel KC is a purpose driven hotel I work with that had huge success with Indiegogo. Hostel KC promises to build a home for the needy with every 300 beds booked. It’s in startup mode, but its founder didn’t want to wait to start living out her cause-driven mission. So, she took to Indiegogo, shared her dream, her love for the people of Jamaica (where she was building the house), and raised plenty of cash to jumpstart construction of their first donated home. You can check out Hostel KC’s Indiegogo page here. I’m proud to report that the house is fully funded and will be built in Jamaica in early June. Check out this video interview I did with Hostel KC founder about her successful campaign.
Raising money on Indiegogo certainly wasn’t a walk in the park. If you’re going this route, you’ll need to follow Hostel KC’s lead: be proactive about asking your local contacts for money, building buzz through social media & news releases, and, most importantly, offering incentives. Donors to Hostel KC’s campaign could receive books, free nights at the hotel, and even a trip to Jamaica, depending on the amount given. You will have to incentivize people to give if you hope to be successful with Indiegogo.
2.) WonderWe – The new kids on the block. WonderWe combines the best of social networking with the best of crowdfunding. It's also exclusively dedicated to crowdfunding for social causes. Because they are newer, competition for dollars is less intense, making this an option you should definitely check out.
3.) Start Some Good – As one of the fastest growing crowd-funding sites, this is a great place for social entrepreneurs because it is purpose based. They also are a smaller community in comparison to Kickstarter, so you can get more attention here. Start Some Good is also one of the most supportive crowdfunding teams I’ve seen. If they approve your cause to be listed, they’ll work with you to help make it a success. Check out some examples of how they help here.
4.) Crowdrise – Crowdrise is specifically geared to raise money for charitable (non-profit) causes. But, this can be a great fit for you if you want to raise cash and build some buzz for the non-profit your business will support. For example, in the Indiegogo section I talked about Hostel KC raising money to build a home in Jamaica. Hostel KC partners with Food for the Poor, a non-profit that has been building homes for the poor for thirty years. The money Hostel KC raised went to Food for The Poor, and allowed Brittain, the Hostel’s founder, to start donating to her cause much earlier than she might have otherwise.
If you don’t want to wait to make a large donation to your charitable partner, Crowdrise may be a great tool for you. In the process, you’ll have a large platform to tell the story of the business you are creating to sustain that initial impact.
5.) Pozible – ‘An agile platform for dynamic, inspired people’. This is pozible’s mantra, and it shows why this platform can be the perfect fit for us. While it is not exclusively for social entrepreneurs, it is a hub for creatives, inspirers, and do-gooders of all stripes, so its audience could be a natural fit for you. Definitely worth checking out as a potential option.
Final note: Crowdfunding sites vary widely in terms of how they profit (usually they take a small percentage of funds raised), goals you have to meet, and types of projects they allow. It is critical that you develop an understanding of these things so you can find the platform that is best for you. I’ve given you a very brief overview here, but I highly recommend you grab a tool like The Crowdfunding Bible or The Crowdfunding Book that will get you the inside scoop.
Direct download: Crowdfunding.mp3
-- posted at: 10:00am CST
Fri, 18 September 2015
As we roll forward in social entrepreneurship 101, it's time we started chatting about how you'll fund your social venture. This is the question I'm most frequently asked about. Next week, I'll start getting you some resources to find funding, but first, I want you to start by asking some questions of yourself:
One of the largest challenges I see cause based entrepreneurs face is how to raise the cash needed to launch their businesses. In the early days, you’ll be refining your story, developing your process, and linking up with your customers. So, it’s highly likely that you will need some ‘seed’ funding to keep you rolling until orders start coming in. Luckily, there’s an entire crop of crowdfunding resources, venture capital firms, incubators, and loan programs that exist specifically to fund social ventures. I’m not saying it’s going to be easy. You’ll have a lot to master, from honing your investor pitch to learning the ways of crowdfunding, but in this chapter, I’m going to tell you everything I’ve learned about funding from the world’s leading social entrepreneurs. I’m also going to put tools in your hand that you can start using right away to get the money you need to launch your movement.
Questions to Start With
Before we dig into those tools, I want to make sure you’ve asked yourself a few questions about going after early stage funding. Asking yourself these questions will help you avoid some of the mistakes I’ve seen other change agents make:
1.) Do you really want to give up a percentage of your company to outside investors?
If you seek any kind of venture capital, the cats with the cash will want a percentage of your company. The level of control they’ll want varies wildly and depends on a lot of things, but you need to ask yourself if this is even a road you want to go down. It may end up being something you have to do, but just be sure you’ve thought this through ahead of time.
2.) Will extra cash cause me to avoid taking revenue generating action?
There are some colossal examples of this, probably the most well known is pets.com. Story goes like this: pets got around a half a billion dollars in cash from investors in 1998. Everyone thought pets.com was the next big thing, they ran a commercial during the Super Bowl, and then the company collapsed in 2000. Why? Lots of reasons: the dot-com bubble was largely to blame, but a deeper investigation shows that pets spent a ton of the invested cash without really focusing on key business metrics like profit, controlling spending, and building up loyal customers.
This is an extreme example of a trend that happens far too often at new startups. Getting flooded with cash can cause you to focus on flashy things like marketing, branding and idea creation, while losing sight of your core business of sustaining social change. Remember, where there is no profit there is no purpose. No margin, no mission. Be sure that you don’t let startup cash take your attention away from the things that actually keep your business and your cause healthy.
3.) Do we really need the money?
I know this question sounds simple, but you’d be amazed at how ‘free’ money can stop you from thinking about all the ways you may be able to boot strap your cause minded startup. For example, many companies offer a ‘pre-order’ option for their first product or service. Basically, this means you’d offer a product before you have it completely developed. Of course, you need to be honest about this, but I’ve seen many companies use this as a great way to build early buzz, a fan base, and ensure they have the funds before creating their first run of products.
Chew on those questions this week, and next week, we'll start chatting about funding resources for social entrepreneurs. In the meantime, keep it real <<First Name>>
Direct download: questions_to_ask_on_funding.mp3
-- posted at: 10:00am CST
Wed, 16 September 2015
Hey Change Nation! We are back with our series featuring the ‘Best of SCN’! This series is focused on taking you back to some of our early days in podcasting and sharing the inspiring and challenging stories of our early entrepreneurs! This week we are featuring Bridget Hilton, an entrepreneur who is literally helping our world to hear every day! The passion she brings to the table fuels her business for social good, LSTN Headphones!
Bridget Hilton, got her inspiration for LSTN Headphones after watching a viral YouTube video of a woman hearing her own voice for the first time. She knew then that she wanted to help give the gift of hearing to the hearing impaired and created LSTN to achieve that mission. Headphones were a natural fit for her social enterprise because Bridget had worked in the Music Industry since she was 15 and believed in the power of music to change lives. LSTN Headphones offer top quality acoustics and an incredibly unique design featuring a sustainable wood casing. For each pair sold, LSTN donates gives the gift of hearing to one of the 360 million people worldwide who are hearing impaired. Bridget shares many tips and tricks of how she has grown her social enterprise to impact over 15,000 patients in under 2 years. Listen in to find out more about Bridget and how LSTN is changing the world through music. Pick up your own headphones and listen to the next Voices of Social Change podcast with a pair from LSTN that looks good, sounds good, and does good.
1. What is the best piece of advice you have ever received?
-Life is Short/You Only live Once.
-Ask yourself, “Am I living the life I want to live.”
2. What are some books you recommend we should all read?
-Four Hour Work Week and Four Hour Chef by Tim Ferriss
-The Promise of a Pencil by Adam Brawn
3. What is your favorite thing to do for a fun escape?
-Traveling and doing things outdoors.
4. Share one online or offline tool you have used to grow LSTN Headphones:
-No Design Skills Needed
-Sell one product or millions
-Accept Payments Instantly
5. Describe one thing everyone can do right now to start changing the world:
-Put your money where your mouth is and buy products that are made by companies that give back.
Direct download: Bridget_Hilton.mp3
-- posted at: 10:42am CST
Fri, 11 September 2015
“your profitability = your ability to profit others.” – Social Change Nation
Welcome to another fantastic Friday. As you're now well aware, Friday is the day we dish out a fresh installment of social entrepreneurship 101. These are the lessons I learned from interviews with 101 social entrepreneurs. If you've missed any, click here for the audio versions. Today, let's talk about profit...
The only way to turn a profit in cause-based business is to profit others far more than you profit yourself. That doesn’t mean you’ll take a vow of poverty, in fact you can do quite well in this business, but it does mean that you have to be other centered.You’ve already shown where your heart is with your story, now it’s time to show it with your money. Cause minded consumers will demand accountability and transparency when it comes to your profits. They will understand that you need to profit to continue to grow your impact, but they’ll want to know exactly what you’re doing with those profits. Let’s dig into some examples of how cause based companies are handling this:
- Tom’s Shoes – Tom’s created the one-for-one model: buy a pair of shoes = give a pair to a child in need. Now, many companies have duplicated this model as it’s a proven way to demonstrate transparency. Another benefit of this model is that people understand it and can easily share the impact they made with their friends. If people can’t easily understand or share your story, you’re going to have trouble growing your movement.
- Life Equals – Life Equals is a one-for-one company too, but they take it a step further by actively showing the number of people their products have helped via a ticker on their website’s homepage. To date, Life Equals has used product sales to give nutritional supplements to over 100,000 children. Anyone looking to join the nutrition revolution can see this ticker, understand it, and share it with others.
- Mission Belt – Mission Belt donates $1 to Kiva for each belt sold. Kiva is a non-profit that gives microloans to budding entrepreneurs. Once these loans are repaid, that money can be re-lent, meaning that every dollar Mission Belt donates is recycled time and time again. I love this model because it fosters entrepreneurship and creates a transparent impact that customers understand.
- Sword and Plough – On top of its ‘quadruple bottom line’ S&P donates 10% of its profits to veteran initiatives. This system may be excellent for you if you don’t have a product/service that leads naturally to a one for one fit. Just be sure to tell the story as well as S&P does (photo credit):
Sword and Plough uses this diagram to transparently communicate every step of its process and profit with its customers.
Take a cue from these great companies when it comes to your profit. Use an ‘impact ticker’ like Life Equals to share your cause, create an ‘impact story’ like Tom’s that is easy for people to pass along, and show your customers a map of your whole process, like Sword and Plough. Profit is the lifeblood of any entrepreneurial venture, and in our case, we need to take it a step further and show our followers exactly how we’re using our profits to better humanity. The steps above will help you get there.
Social Entrepreneurship is a tough business. Yes, you’ll have fun, meet incredible people, turn your dreams into reality, and create social change. But you’ll also have more 15 hour days than you can count, scads of sleepless nights, missed social events, and ebbs and flows of cash like you wouldn’t believe. Because of this, you need to devote a small portion of profit to keeping yourself sane. Cook up a nice dinner once in awhile, go to a movie, take a vacation (one that fits your budget, that is :), or buy some fun item. Bottom line: you need to take care of yourself too. We change agents are ripe candidates for burn-out because we’re dunked in social problems every day. Take a little bit of the profit you’ve worked so hard for and re-invest it in yourself.
P.S. One of my favorite thought leaders on profit is Mike Michalowicz. Mike’s writings are funny, informative, and a breath of fresh air for entrepreneurs of all stripes. Check out his books Profit First and The Pumpkin Plan for a roadmap to profits in your cause minded business.
P.S.S. Have you ever hit 'reply' and told me what you're up to in the world of social entrepreneurship? If no, hit me back now. I'd love to hear from you.
Direct download: Profitability.mp3
-- posted at: 10:00am CST
Tue, 8 September 2015
Hey Change Nation! We are back with our series featuring the ‘Best of SCN’! This series is focused on taking you back to some of our early days in podcasting and sharing the inspiring and challenging stories of our early entrepreneurs! This week we are bringing back Olivier Kamanda, who has some good news about social entrepreneurship as he shares about his social venture Ideal Impact!
This chat with Olivier was the second in our series featuring entrepreneurs working through the Halcyon Incubator in Washington, D.C. Ideal Impact is a community oriented tech company designed to bridge the gap between those who want to serve and organizations that vitally need support. The App serves as an online platform that matches people with opportunities to volunteer, donate, support, and advocate for various causes based on the news stories they follow. Olivier developed the algorithm that categorizes 97 percent of all news websites to find the articles specific to your personal interests. Olivier discusses many things vital to the life of a new social venture, including the decision to have a for profit structure. He wanted Ideal Impact to be a company whose mission is to build a community around worthy causes while generating sustainable income. Olivier’s impact through his company and his experience in politics, law, computer science, and as volunteer Sous-Chef has made his story newsworthy in his community and across the country. His last words in the interview were encouraging others to act and not sit back when they feel moved by particular causes or movements.
Are you ready to make in impact that is newsworthy?
Tune in next Wednesday to continue our ‘Best of SCN’ series!
1.) Who is your personal Hero?
2.) What is your favorite book to read?
3.) What is one online or offline tool you are using to grow your business?
Pocket -Put articles, videos or pretty much anything into Pocket. It has the ability to save directly from your browser or from apps like Twitter, Flipboard, Pulse and Zite.
4.) What is the best piece of advice you have received?
5.) What is another awesome Social Venture we should all check out?
- Hand Up - It sets up the homeless with crowd-sourcing websites for donations.
Check out the Ideal Impact Website HERE!
To Subscribe to the Social Change Nation Newsletter Click HERE
Check out the Social Good Shopping Guide and Directory HERE
Love audio??? Josh has gotten everyone a free audiobook download! Click here to get your free book! And click here to get you some LSTN Headphones – they’re the cause-based headphones we use around here for all the podcasts & audiobooks we listen to!
This podcast is broadcasted proudly from the Kansas City Startup Village.
Direct download: Olivier_K.mp3
-- posted at: 4:08pm CST
Fri, 4 September 2015
"Make people feel like they can become part of something greater than themselves, and they’ll love you for it."
That's a little quote I dreamed up as I was chatting with social entrepreneurs around the world. If there is one thing that makes a successful social entrepreneur stand out, it's their ability to bring people into causes that are bigger than any one person. In today's installment of social entrepreneurship, let's talk about how you build a team that is dedicated to your mission. If you don't think you're at the point of building a team, think again - even if you're finding volunteers or committed customers, you need to be thinking about building your movement from the earliest of days. (btw, if you've missed earlier installments of social entrepreneurship 101, click here for the audio versions)
There has never been a better time to build a team as a cause based entrepreneur. Study after study has shown that the vast majority of employees feel they lack meaning in their work. A full two-thirds of employees are currently dissatisfied at their jobs, and a big reason is lack of purpose. Millenials new to the job market also indicate that they value meaning above high salaries and classy benefits. As a result, job-seekers are hunting for companies offering cause-minded careers. This means that cause based entrepreneurs like us have opportunities that are tailor-made for today’s best and brightest.
How great is that?! Not only are you going to build a movement around an issue that’s near and dear to your heart, you’re going to be able to use that story to draw in the best talent that the world has to offer. Pretty cool huh? Now, I know that you may not yet be building a team, but I’m still really stoked for you. By getting an understanding of what today’s team-member is looking for, you’ll be able to share your story in a way that will have people biting at the bit to work for you when the time comes.
Let’s check out two examples of how other cause-based companies have used their story to build stellar teams:
- Upworthy.com – If you haven’t heard of these guys, check em’ out now. Upworthy is, bar-none, the best place on the internet for purpose driven content. But what I really love about Upworthy is that their job board is a manifesto for their cause. It’s packed with lines like “be part of a team having real impact” “We’re changing how media is done” and “life’s fun on a rocketship” (check out the full page here). You can feel Upworthy’s crusade mentality from the get-go. Create that same moment on your job board.
- Sword and Plough – Talk about a bunch of change agents, Emily and Betsy are the military veteran founders of this cause minded company. S&P touts a ‘quadruple bottom line’ because they re-employ vets to make the company’s high quality bags, re-purpose military surplus materials in their manufacturing, and their profits help support military families. The company’s manifesto is a prime example of how to draw in a cause minded team (photo credit):
I dunno about you, but I get chills down my spine every time I read that. Live out a manifesto like Sword & Plough’s, share that story with the world, and you’ll build a powerful team.
You now see how you can use your story to help you build a team of dedicated change agents. The story of your team has other advantages as well. Cause minded consumers want to know that you have a happy team who is well taken care of. Upworthy touts its incredible benefit program, unlimited time off, and family centered culture that make it a great place to work. Sword & Plough is an example of a company that takes that even further: its team is part of its purpose. By re-employing veterans in its manufacturing process, S&P is combatting the high levels of unemployment among military veterans and training them with skills needed to succeed in today’s marketplace. Boldly make statements about how you treat your employees and you will draw in a great team, great leaders, and great customers.
Direct download: Teambuilding.mp3
-- posted at: 10:00am CST