Social entrepreneurship is becoming increasingly important all over the world. The main difference between what we generally call an enterprise and a social enterprise is in that the majority of companies measure their success through earned and retained profits, whereas social enterprises measure their success in the quantity of people they have helped and the extent, to which they made this world a better place to live in for all the members of society. Social enterprises usually apply their profits either to their own growth and promotion, or to the promotion and the development of the entire community.

                Some contributions social entrepreneurship makes to society are increasing the solidarity and cohesion, encouraging cooperation between people and volunteering, inspiring people to innovatively solve problems that society faces, etc. Even more importantly, it provides an increasing amount of people with employment, many social enterprises produce food and help people who are hungry, get something on their plates, but it also boosts the economy from the socioeconomic as well as traditional economic perspectives. Social entrepreneurs operate in the fields of family safety, animal protection, environmental sustainability, promotion of health and physical activity, fair trade, social inclusion, sustainable energy sources, etc.  Thus, social entrepreneurship seems to substantially contribute to the positive changes we increasingly see in this world, and since making a social enterprise flourish is very difficult, especially with the difficulty of gaining funding, we should invest some effort into nourishing it and helping the budding social entrepreneurs thrive even more. As a member of the social entrepreneurship community, we will hopefully help our colleagues through creation of this article, which is going to contain some information on how to finance a socially focused business.

                In general, there are many options for funding a social enterprise. Some of the initiatives through which many countries are trying to promote it, are granting loans at favourable rates, grants, subventions and funds, which are specifically focused on this type of business. In addition, social enterprises are also receiving a lot of attention from the European Union, which designed a strategy for promoting social entrepreneurship all the way to the year 2020. One of the reasons it has done so is probably the fact that nearly 20% of Europeans are already walking the path of social exclusion and poverty, which is a very frightening statistic for a part of the world, which is supposed to be among the better developed ones. A few initiatives that the EU has taken on in providing financing options to social enterprises are through the European Social Fund, which is supposed to promote employment and social cohesion in the member states of the European Union, the European Agricultural Fund, which aims to support European farming community and the European microfinance initiative. Besides these institutionalized funding options, there are also quite a few private financing strategies. These include social bank, which is an umbrella term for ethical and alternative banks, the private investors, for example, companies which are already operating in the social entrepreneurship sphere or who wish to expand their operations to incorporate more socially sustainable projects and through philanthropic funding, for example, if you have a really remarkable idea, you could contact people such as Warren Buffer & Bill Gates, who would certainly be excited to help. One of such initiatives supported by Bill Gates and Microsoft, is Salman Khans’ YouTube mathematics lessons, which later developed into Khan Academy. Gates initial investment into the project was $1.5 million, however, he later poured in at least another $7.5 million. This means that if your idea is really good and you can persuade a famous philanthropist to support it, it could enable your help to reach millions of people. For an inspiration, make a note of Khan Academy, which today educates over 10 million people a month.

                Another path of obtaining financing for a social enterprise which should not be forgotten and actually resembles what Gates did with Khan academy, though we have observed that many social enterprises wish to avoid it, is getting funding through donations. Even though we realize that most social enterprises wish to contribute to the society with their hard earned money, we feel that sometimes slightly too much attention is put on that, as what is supposed to matter is helping people, not where you obtained the means to do it. A few simple ways of collecting donations can be through posting a “donate” link button to your webpage, promoting your cause and willingness to accept donations through social media, or through directly contacting companies who you feel care about society, to perhaps help you with your start. If you are sincere, persistent and honest in your efforts, we are certain that success will come your way. You could also try to gain funding through sponsorships or memberships.

                Hopefully, we have provided you with some valuable insight into obtaining funding to help change the world yourself, through your own social enterprise. If you feel there is something we forgot to mention, don’t hesitate to tell us about it within the comments section bellow and if you wish us to write another article on this topic, let us know about that as well, or any other topic you want us to touch upon of course. Enjoy your day and don’t forget to read our other articles as well. If you are into social entrepreneurship, you could perhaps start with the article on social franchising.

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