Webinar: A social entrepreneur’s guide to financing

For social enterprises to realize their potential as influential actors in the global development landscape, they need to scale their impact. That means finding the right capital, from the right sources, at the right time.On Thursday, Devex hosted a webinar, in collaboration with the Skoll Foundation, to discuss how social enterprises — both for-profit and nonprofit — can develop a sustainable funding strategy.

Here are some of the key takeaways from panelists on ways social entrepreneurs can finance their pathways to scale.

Even if you’re a nonprofit, operate like a business

One Acre Fund, a nonprofit social enterprise that supplies smallholder farmers with tools and financing to increase their incomes and improve their livelihoods, applies for grant funding to subsidize activities such as training that are not likely to generate revenue, and debt capital to finance products that people will pay for, such as seeds and fertilizer and solar lamps.

“We are a nonprofit, but we operate a lot like a business,” said Andrew Youn, co-founder and executive director of One Acre Fund. “That combination is really important.”

Grant financing is critical for the organization because it makes it possible to focus on “some of the most deeply unprofitable customers in the world,” and at the same time, revenue is important for providing better services to farmers, he explained.

“What we can do is try and create an incredibly cost effective way of serving the rural poor, and so we’re constantly seeking to drive down our donor cost to serve,” he added.