How to raise funds through a social enterprise

Written by Tawina Jane Kopa-Kamanga, TAWINA, Malawi

Please describe the fundraising situation that your organisation faced.

We started the social enterprise in response to needs of the beneficiaries of our sexual and reproductive health and right (SRHR) projects and the challenges we encountered in the delivery of those projects. These motivated us to develop an unrestricted funding stream. We already had agricultural skills, developed through a grant-funded soybean and piggery* programme that we had been running, so we saw an opportunity to use those skills to set up an agricultural social enterprise.

*We recognise that some communities who are thinking of setting up an agricultural social enterprise may prefer to use different animals or only focus only on producing vegetables.

Why did you decide to raise funds through a social enterprise and how did you go about doing this?

Initially, our fundraising strategy had been aimed at increasing funding through grants and donations, which we successfully did. But as our programming evolved and the number and diversity of beneficiaries increased, we encountered funding needs that could not be addressed through grants. We sometimes had situations where there were girl-protection and safety concerns that needed immediate action or financial support, for example, during legal proceedings. This motivated us to diversify our funding portfolio.

So, we seized the opportunity to set up a social enterprise. Using the competences and skills that we already had in piggery, soybean production and also organic vegetable gardening, we restructured these initiatives so they could be delivered as a social enterprise, with successful results.

What did you achieve?

Our social enterprise has been a success, not just in terms of stabilising our cash flow, but also in strengthening our relationship with the communities that we serve. It has facilitated partnership building, promoted organisation visibility and been a tool for focusing community attention on adolescent SRHR issues.

It took six months to start making money from the soybeans, and a year for the piggery. The social enterprise has continued to grow and is now our main sustainability strategy.

Until September this year, we did not have salaried staff for the social enterprise. We now have one member of staff overseeing it, supported by three people who are responsible for feeding and managing the pigs, slaughtering and packaging, as well as pork deliveries. These three do not receive a salary but stipend (that is, no tax and pension).

What did you learn from this experience?

A social enterprise is a good way to raise funds for an organisation and it can provide quick returns to respond to emerging needs that cannot be easily addressed through grant (or restricted) funds. With proper timing, planning and know-how, it can be a rewarding undertaking for an organisation.

A social enterprise fitted in well with our work on adolescent SRHR, in that it adds to the relationship we have with the community through the financial element, which is an attraction to the women and their community. This makes it easy for us to communicate the messages on child, early and forced marriage (CEFM). I see it as a strategy for mobilising and engaging the community, just the same way one would utilise drama or sports to communicate messages about SRHR. Where there is a mention of money, everyone listens, and that is the best time to strike.

Also, to be involved in our social enterprise activities requires one to commit to upholding the rights of adolescent girls. For instance, it is primarily women who are raising or caring for adolescent girls and girls in marriage who benefit from the social enterprise. The rationale is that income that they raise will enable them to better meet the education needs of the girls. Their involvement also gives us the opportunity to continuously monitor the girls who are the beneficiaries of the CEFM interventions. 

Managing a social enterprise is like running a separate programme. It has its own needs for resources, such as administration and monitoring and evaluation. Specialist skills in the chosen social enterprise area, such as agriculture, are also needed. This can be time, labour and financially demanding. So, if you leverage your existing skills and experience and set up a social enterprise in an area you know about, for example, as we did in agriculture, then that is your best chance of success.

Also, if not well planned and resourced, a social enterprise can interfere with core activities of the organisation and staff might find it hard to balance their time and effort between the social enterprise and their core responsibilities. In the case of TAWINA, we overcame this by recruiting staff dedicated to social enterprise development and management for that part of the organisation. This can be expensive, but it is the best alternative where you are raising enough revenue to cover staff costs.

Setting a goal for your fundraising or social enterprise helps you to stay on course and motivated.

What are your tips for someone facing the same or similar issues / that wants to do the same?

  • There is no ‘one size fits all’ approach to being a social enterprise. Understanding your situation and context is key to success.
  • Being a social enterprise can be quite involving and at times requires specialist skills. You will need to invest your time and resources to develop those skills or outsource them. For example, customer relationship management, business skills, and enterprising development skills may not be readily embedded in non-profit entities with a focus on programme or project output delivery and a not-profit orientated approach.

Would you like to tell us more about this challenge your organisation faced?

As the social enterprise grows, we are considering having it as a stand-alone entity that would act as a funding stream for the organisation. In a way, divorcing it from TAWINA to allow for its own management arrangements to evolve. It is a learning curve, but we think it is a worthwhile plan. That way, we think that we can focus on the core mandate of the organisation and not feel like we are pursuing two causes with one being revenue driven.

Although we are more identified as defenders of girls’ rights, others think of us from agricultural enterprise perspective. So, there is a conflict sometimes.

Did you use any external resources to help you solve this issue that you would recommend to other organisations? 

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Tawina Jane Kopa-Kamanga, TAWINA, Malawi

Tawina Jane Kopa Kamanga is Founder and Director of a woman-led and centred grassroots organisation in Malawi called TAWINA. Registered in 2014, TAWINA has been delivering innovative and individualised solutions to challenges faced by those who have experienced sexual and gender-based violence including child, early and forced marriage (CEFM). Over the last four years, Tawina Jane has been leading a fundraising strategy that has led to the development of a social enterprise aimed at empowering women economically while generating sustainable and unrestricted revenue for TAWINA.