Social Enterprise — The Road to Sustainability for Your Nonprofit

By Jean Block

Often, seeking funding from traditional sources is like filling a funnel— you receive money from grants, sponsorships, donations, and pour the money into the funnel, use it up and have to work like crazy to keep the funnel filled. And the money in the funnel usually comes with strings attached defining how you use it, report it, etc. Funnel-filling becomes an endless cycle.

Wouldn’t it be great to have a regular source of unrestricted income that you could use for operating expenses or new programs or whatever your agency needs to better fulfill its mission?

This concept of unrestricted income isn’t a pipe dream. It can be a reality that is attainable for your agency through a program of social enterprise.

Nonprofits all over the U.S. are learning about earned income (social enterprise) as a way to deal with the uncertainties of traditional funding, cutbacks and giving decreases.

What is social enterprise?

Social enterprise — or earned income — is simply money that you have generated through product sales, payment for services, or other business opportunities that is yours to use as your organization sees fit. If successful, it builds upon itself and earns more. It is unrestricted income that creates the path toward self-sustainability and enhances your mission. Although there are many opportunities to earn money, our experience has taught us that the most successful enterprise ventures are based on an organization’s current assets: what they do well (core competencies), what they know (technical and knowledge assets) or what they have (underutilized physical assets).

Sometimes, all that’s required to begin a social enterprise venture is finding a new market for current services, or re-pricing current programs or finding new uses for current space.

Specifically, some of the agencies we have worked with have developed the following earned income programs: a monthly flea market on agency property, arts and culture distance learning programs, weddings and programs at a botanical garden, customized fitness programs, nonprofit training and consulting services, contracts with school districts for science learning programs, upscale thrift stores, entrepreneurial training for children through a community store, transitional housing programs, and many more.