As the world progresses, the business landscape changes with it. In recent years there has been a shift in focus from traditional businesses to those with a social impact. This is evident in the growing number of social enterprises and purpose-driven businesses that are popping up all over the globe.
While this is a positive trend, there is still a lack of understanding of how these businesses can be successful. A common misconception is that social impact businesses are only viable if they are non-profit or have a small scale.
However, this is not the case. There are many examples of social enterprises that are profitable and have a large scale. In fact, some research estimates that the global social impact economy could be worth $2.5 trillion by 2025.
So, what is the secret to success for these businesses? How can they achieve profitability while also having a positive social impact?
The answer lies in understanding the six-figure business model for social impact businesses. This model outlines the key components that are necessary for these businesses to be successful.
1. Purposeful Business Model
The first component of the six-figure business model is a purposeful business model. This means that the business must have a clear and defined purpose that goes beyond simply making money.
The purpose of a social impact business should be to create positive change in the world. This could be through solving a social problem, improving access to essential services, or anything else that has a positive impact on society.
Having a clear purpose is essential for attracting customers, employees, and investors who share your values. It also helps to create a strong brand identity that sets you apart from traditional businesses.
2. Sustainable Revenue Streams
The second component of the six-figure business model is sustainable revenue streams. This means that the business must have multiple sources of revenue that can support its growth.
A common mistake made by social entrepreneurs is relying too heavily on grants or donations. While these can be important sources of funding, they are not reliable in the long term.
Instead, social impact businesses should focus on generating revenue from other sources such as product sales, services, or subscriptions. This will help to ensure that the business is sustainable in the long run.
3. Scalable Operations
The third component of the six-figure business model is scalable operations. This means that the business must be able to grow its operations without compromising its quality or service.
Scalability is essential for social impact businesses because they often have lofty goals and a large target market. If the business cannot scale its operations, it will struggle to achieve its goals and make a meaningful impact.
There are many ways to make operations more scalable such as automating processes, outsourcing non-essential tasks, and using technology. Finding the right mix of these will depend on the specific business and what works best for them.
4. Strong Leadership
The fourth component of the six-figure business model is strong leadership. This means that the business must have a leader or team of leaders who are passionate about the business and its mission.
Strong leadership is essential for any business, but it is especially important for social impact businesses. These businesses often face challenges that traditional businesses do not, such as resistance from established players or a lack of understanding from the general public.
Having a leader who is passionate about the business and its mission will help to overcome these challenges and ensure that the business is successful.
5. Engaged Stakeholders
The fifth component of the six-figure business model is engaged stakeholders. This means that the business must have a group of people who are invested in its success.
Engaged stakeholders could be employees, customers, investors, or anyone else who has a vested interest in the business. These people will help to promote and support the business, which is essential for its success.
6. Measurable Impact
The final component of the six-figure business model is measurable impact. This means that the business must be able to track and measure its impact on society.
Measuring impact is important for social impact businesses because it allows them to show their progress and demonstrate their effectiveness. It also helps to attract more customers, employees, and investors who are interested in supporting businesses with a positive social impact.
There are many different ways to measure impact, but some common metrics include customer satisfaction, employee engagement, and financial performance.
Making the switch to a six-figure business model can be a challenge for social entrepreneurs. However, it is essential for businesses that want to achieve their goals and make a lasting impact on society.
If you are a social entrepreneur who is looking to scale your business, we encourage you to consider the six-figure business model. With its focus on sustainability, scalability, and impact, it is the perfect framework for businesses that want to make a difference.