Social Enterprise and family business

http://www.ifb.org.uk/ The world is witnessing the emergence of new business models where entrepreneurs with a social conscience are creating an impact while making their venture financially sustainable. The growing emergence of this form of business, known as social enterprise, is an area where the UK sets the pace.

For family business owners awareness of these new models is highly relevant; for example in terms of how social enterprise can form part of the business’s supply chain or indeed how next generation family members could see social enterprise as part of their career development.

The IFB Women’s Forum recently visited the acclaimed School for Social Entrepreneurs (SSE) in east London. This organisation helps develop business projects and provides training and opportunities for people to use their abilities more fully for social benefit. One of the enterprises SSE supports is Bikeworks, based in Tower Hamlets, which provides cycling for all, encouraging the health and wellbeing of everybody in their community. In three years of trading the co-founders have built a business making significant social impact with revenues approaching £1M, and now poised to expand their brand across London.

In another example social entrepreneur and former scientist Sheenagh Day was inspired to establish Maison Bengal a fair trade company, producing high quality home and gift accessories, whose philosophy aims to improve the lives of communities in Bangladesh by developing a sustainable market for their products. The business sells its products through retailers such as Heals and the White Company and has helped thousands of women and their dependents.

These successful companies show how blending strategies from the for-profit world with the social aims of Non-governmental organisations and charities can deliver a sustainable positive impact.

Related articles

• Wates takes social enterprise seriously (telegraph.co.uk)

Family business entrepreneurs: the pros and cons of family support

http://www.ifb.org.uk/ The recent sell-out IFB Next Generation International Convention on entrepreneurship was a tremendous success as 185 young delegates from 25 nations listened to inspiring speakers on starting up companies, intrapreneurship in an existing business and emerging social enterprise models. The consensus seemed to be that today’s young family business members want to make their own mark in the early stages of their careers, either by working in a non-family company, or increasingly by setting up their own business. Choosing the entrepreneurship route is becoming more popular; it gives the young person more independence and is a great way to prove yourself, at a stage in life when there is often little to lose.

One of the most active questions discussed was the pros and cons of having “family support” when starting a new business. Advantages include access to capital, ready-made networks, other support that the family (and perhaps its business) can provide and the pressure to succeed. On the downside many felt that using family resources including funding could lead to a lack of independence and thus a loss of freedom for the entrepreneur.

Lara Morgan, founder of toiletries success story Pacific Direct, told the story of how she broke away from her father’s firm at 23 and never looked back eventually selling her business for £20M. She argued strongly in favour of having full control over one’s destiny without anyone looking over your shoulders. Others argued that family entrepreneurs should welcome family support. If a family member starts a new venture family capital and networks can be invaluable; but if the family are investors care needs to be given to the governance system that should give the entrepreneur the freedom to manage, with a good board in support.

Entrepreneurship - the pursuit of opportunity

http://www.ifb.org.uk/ I’m looking forward to hearing the opening address by Professor John Mullins, of the London Business School, at the IFB’s Next Generation International Convention 2011 in January. The convention’s theme is Entrepreneurship – the pursuit of opportunity and as associate professor of management practice in marketing and entrepreneurship, Mullins is an acknowledged expert in the field.

Professor Mullins will be developing some themes from his latest book Getting to Plan B, where he debunks the form-filling, spreadsheet-driven mentality popular in business planning. Mullins believes that entrepreneurs should adopt a series of ‘stress tests’ to their initial ideas so that any weaknesses can be corrected. He suggests that the real success of companies such as Google, PayPal, Starbucks and others was that they were prepared to rip up Plan A and make radical changes to their business model.

Cover via AmazonHe has also identified two other key criteria for any successful enterprise to assess. First many business people see fast-growing markets as a good area to explore, but Professor Mullins wants people to realise that the more important side of the equation is to ask whether customers will actually buy your product. Secondly if you’ve satisfied yourself on that question then you have to ask if you can build a sustainable competitive advantage in that industry – otherwise you might find a bigger player comes along and wins the day.

We feel sure that insights such as these will inspire and enthuse the next generation family members who attend the Convention 28-29 January 2011. It will be a great occasion for delegates to hear from a line-up of international speakers about entrepreneurship in all its forms - whether its starting a business, looking to set up a social enterprise, or just learning more about entrepreneurship.

You can hear more from Professor Mullins about these ideas on this video.