How to kick start your Social Enterprise. What you need to know.
What is a Social Enterprise?
There are over 100,000 social enterprises throughout the country. Contributing £60 billion to the economy and employ two million people.
Firstly, Social Enterprise, Charity, Community Interest Company (CIC) all appear to have a similar goal. That is to help with the well-being of the community.
Secondly, they exist to help solve social needs or problems. Starting a social enterprise can be exciting, challenging and scary. However with the right support you will be able achieve your goal.
Social entrepreneurs can make a good profit themselves. Also they can benefit others by reinvesting profits back into the business. There is no legal definition for a social enterprise. Likewise they can be of any size; national to international or small community-based enterprises.
Sounds just like charity work, right? Well, charities often operate as social enterprises. But they cannot make a profit. All income must be reinvested in making a difference to the cause. There are no owners or shareholders who benefit from it. However there’s a board of Trustees. They are responsible for making sure management are running it properly.
Types of Social Enterprises
Community Interest Company (CIC):
Above all a CIC is owned by the local community. They are ran to benefit local people/communities unlike private shareholders. Most importantly it involves trading a product or service. These can include community centres, social clubs, nurseries etc.
CIC structure can be:
• a private company limited by shares. Where you have shareholders and directors. Directors can receive up to 35% of the surpluses as dividends.
• a private company limited by guarantee. This does not have shares or shareholders and cannot pay dividends, only directors.
Co-operatives:
Where members share the profits/loss or benefits. The approach is owned, controlled and run by its members who subsequently benefit from it. Every Co-operative is either a Company Limited by Guarantee, a Co-operative Society or a Community Benefit Society.
Other types of social enterprises:
Credit Unions. Financial institutions that provide savings and loans for their members
Housing Association. Offering help and support to vulnerable people with housing needs
Social Firms: Provide guidance and opportunity for individuals who are less able or with mental health issues.
Summary
In conclusion, when social enterprises make profit, societies and local communities also benefit. As a result this creates employment opportunities and more innovation. Such as, introducing new services to support vulnerable people etc.
To sum up a social enterprise reinvests profit to help create more projects & employment. Likewise protecting the environment and providing services to people otherwise not have access to.
Want to kick start your Social enterprise? Then get in touch today and see how we can help you