Be greedy for social change, and your life will be endlessly enriched. The only failure lies in not trying, or in giving up. Ann Cotton, Welsch entrepreneur and Founder of CAMFED
What does the word ‘failure’ bring to mind for you? For many people, the answer is shame or a feeling of inadequacy. But what sets truly successful innovators apart is their ability to reframe failure as a valuable learning opportunity, rather than a reflection of their own worth.
Social entrepreneurship is not something you can do from the sidelines. Being a social entrepreneur means being in the arena, and to quote Breneé Brown, “when we make the choice to dare greatly, we sign up to get our asses kicked. We can choose courage or we can choose comfort, but we can’t have both.”
When you’re bringing an innovative idea into the world that didn’t exist before, there is no clear path to follow. Instead, you have to be brave enough to forge your own through a process of trial and error. What we admire so much about social entrepreneurs is not their ability to get things right the first time they try – it’s their willingness to stay in the arena until they do.
Whether you’re an aspiring social entrepreneur whose fear of failure is holding you back, or an early-stage Founder looking for inspiration from those further along the path, we asked 30 successful social entrepreneurs in our S-GRID program and across our network the question: What is a failure that you learned from early on that helped you scale your social enterprise later?
Below are the valuable lessons and stories they shared – we hope their vulnerability and resilience inspire you as much they inspire us!
Lesson 1: Focus your value proposition/mission
“We found that being able to offer various products to several different types of customers made us generalists, and with limited resources, we had a limited reach. So one of the most valuable lessons we learned early on was the value of focusing our offerings. Doing so has allowed us to be the first to market in offering our specific water quality solutions to rural communities in Central America, as well as establish ourselves as experts in the space that partners and customers would want to work with.” – Wesley Meier, EOS International
“We ended up trying a lot of different services and interventions that didn’t work and were ultimately disbanded. It was tough for us to increase paid uptake, which was demotivating. So what we did was take a step back and look at our customer segments again to find a logic, a user journey, and this enabled us to package our interventions into a bespoke incubation and growth readiness programme that no one else was offering at the time. This also taught us the importance of formulating goals that were exciting for us as well as for our clients. For example, one goal we had was to support “250 women, 250 businesses, in 250 days” per program. Our vision is “A better world, powered by women”, and the two combined served as our guiding star. It is not just a nice marketing exercise, it forced us to put a replication system in place and reach out to the associates who could help us reach this number in a very nimble way. Finance providers and other clients got excited and wanted to be part of this journey too.” – Servane Mouazan, Ogunte CIC
“Our failure to plan in the beginning of our initiative was our biggest mistake. Having said that, I am reminded of the saying, ‘If I had known how difficult it was going to be I probably would not have started.’ So, in retrospect, it was our enthusiasm and naivité that gave us the energy to start doing our work with the community, and look for ways to survive as a business in the process. However, after six years of hard work, the time arrived when we realized that we needed to start planning for our future. In the last 8 years we have made three strategic plans which have enabled us to refine and focus on our mission and in order to focus on the quality of our projects while seeking to reach larger sectors of the community.” – Tony Evanko, Fundación Casa Tres Patios
“We started out selling honey, as honey, then realized that we could not compete with generic honey sold in little bears… so we stopped selling honey and started selling Wild Forest Honey that provides sustainable incomes, traceability, combats climate change and supports the environment and positive change through business. We make 1 + 1 = 3!” – Paul Whitney, African Bronze Honey Company
“Early on, I was spreading myself too thin by trying to reach too broad of an audience too quickly. In the first three years we were in business, I was working with artisans in many different countries (outside of Malaysia). It was a great foundation of learning, however, a lot of my time, money, and energy was spent trying to work with artisans in many different countries, and our impact on the communities could not be scaled. Part of the reason I began with that approach was that I didn’t think we had many artisans left in Malaysia. In 2015, when we won the British Council Social Enterprise award, we were asked to make Malaysian made products. We started travelling throughout Malaysia, and realised Malaysian artisans would also benefit from our engagement. By focusing on one country, we have been able to create greater scale with our products, raise the value of crafts and impact the communities in a much deeper way.” – Sasibai Kimis, Earth Heir
Lesson 2: Build the right team
“A failure early on in my social enterprise journey was overworking, which led me to experience burnout. At the time, I was working on the business as a solo entrepreneur, and struggled to balance work and life. I thought everything was urgent, and that I needed to be an expert at everything I did. Once I took the time I needed to rest and recover, I focused my energy on building the right team around my social enterprise, and practiced prioritizing so I still had enough time to invest in my personal wellness.” – Rebecca Jacobs, Anika Works
“With Kenya being a largely bare market for professional elderly care service, we initially failed in forecasting the level of involvement by our team members. Despite having a well-documented project plan, we lacked the information and resources needed for implementation. This significantly slowed our pace — almost stalling our project between the ideation and piloting stages. We subsequently adopted smaller, bottom-up approaches to scaling. This allowed us to learn more quickly and engage team members as needed. We soon replicated this process across all the project service channels in development. We quickly learned that by creating a skilled team with vast entrepreneurial knowledge and remaining agile, we could facilitate scaling and quickly gather the skills and resources that our projects needed to grow.” – Richard Waindi, Agewatch Africa Foundation
“Making bigger and earlier investments in hiring the right talent.” Ada Yip, Urban Spring
Lesson 3: Find the right partners, and invest in building long-term relationships
“As Martin Tanaka once wrote, ‘To win, you need to have good partners (good company)’. This is a failure I, as a leader, committed in the very early stages of our social enterprise. However, it has taught us a lot. Despite the fact that our work continues to be challenging, we have very good partners. This can mean a lot of different things: good and committed mentors, good organizational partners, good community partners and last, but never least, good and committed staff and Board Members.” -Maricarmen Valdivieso, Nexos Comunitarios
“Account for the time needed to help your partner fully understand what you do, including the financial and impact goals. It’s sometimes a long and arduous process, especially if you’re doing something that’s not as easy to articulate, but without a foundation of mutual understanding the impact of your work together will be limited.” – Juvita Tatan Wan, The Tuyang Initiative
“Initially, we thought it made sense to partner with other startups in emerging markets – thinking that as a very small business ourselves we should partner with other ‘very small’ and early-stage businesses. While in theory this made sense, it was not practical. We realized we needed to partner with very experienced agents, distributors and businesses in emerging markets and low-resource settings who we could learn from.” – Meg Wirth, Maternova
“When I started my journey as a social entrepreneur and change-maker, my ideas and projects were rejected. There was nobody experienced enough to guide me. I went to grassroots organizations and to NGOs with the belief that we must change to overcome poverty, but I was rejected because it didn’t fit in their guidelines or conception. But as time went on, my assumptions were validated because the same types of ideas and projects were finally being launched abroad and implemented locally. The failure from being rejected and misunderstood early on pushed me to create The YCDP and look for support at the international level if I couldn’t find it locally. I started dealing directly with the international sphere where I found passionate and empathetic people as organizations dedicated to solidarity and making the Earth a better place. On the international stage, I understood that I should raise the level of my social enterprise to higher quality standards in order to open the door to future partnerships and funding. I understood I lacked some skills and methods to do this on my own, so I started to develop them, looking for SKILLED volunteers and EXPERIENCED practitioners too.” – Like Gom Koudjaho, The Youth Centre for Development and Peace (The YCDP)
Lesson 4: Don’t try to grow too soon or too fast
“A few years ago, I lost a valued and valuable team member. What caused this person to leave was a lack of structure and process. We were moving fast in all directions. Where that way of working had become a habit with me, I had not recognized the hardship it could be for others. With this new awareness, I turned my focus to bringing in a team and building the processes that would facilitate our remote way of working and prepare us for long term growth. This step continues to prove itself to be of great benefit and we continue to be able to improve the strength of our team because of it.” – Lisa Arie, Vista Caballo LLC
“When we prioritized growth over culture, we realised that it compromised the relationships within our small team. When co-workers weren’t a culture fit, we still kept them for the sake of growth. After a couple painful episodes of fitting square pegs in round holes, we learnt the hard way the importance of prioritizing culture fit over brilliant jerks. Now, it’s at the heart of who we hire, and that has helped us grow the business healthily and sustainably.” – Si Hui Lim, Glyph
“Not all growth is good, and less can be more. In our desire to grow we sometimes pursue growth at all costs. If this desire to grow is paired with poor financial decisions, such as using short term (working) capital for medium-long term investments, you will find yourself in a tight spot liquidity-wise very quickly. This applies especially in the developing world context, where interest rates run in the double digits. Once again, we at Naturally Divine learned this the hard way, and it tooks us a couple of years to clean our financial slate due to growth investments that did not deliver the desired effects. In pursuing growth at all cost, amongst other things, one runs the risk of becoming liquidity poor, overloaded in fixed operating costs, and later on you realize that in some cases downsizing will make you leaner and more efficient. Although this appears and can feel like taking a step backwards, in reality it is you streamlining and optimizing your business based on experience gained, and it is only a temporary step back in order to propel you forward once again. Moral of the story: learn to use financial tools in an appropriate manner, and only pursue growth when it adds value (social or economic).” – Pim van den Hoven, Naturally Divine Peru
“Overpromising and under-delivering. We realized we didn’t have a precise enough understanding of our production capacities due to lack of raw material, trained artisans, and lead times.” – Diego Olivero, Meso Goods
Lesson 5: Involve all stakeholders throughout the process
“One failure was focusing on what I thought our business should offer, instead of remaining open to opportunities based on user demand. In the beginning, at Akamae we Co-created (designed in-house) jewelry and accessories with remote refugee artisans. I was so focused on marketing and selling these items that when fashion designers from around the world began reaching out to me to help them do the same, I turned them down. Flash forward one year and thankfully I took the time to reflect. I re-developed our business model to reflect our niche and opportunity. At this present moment, Akamae facilitates connections between fashion brands and remote refugee artisans.” – Cara Boccieri, Akamae
“While opening our school project, I didn’t engage community members in decisions about things like how to run school activities, how much of a fee to charge, uniform designs, the qualification levels for teachers, drafting school rules and regulations, or engaging parents in mobilizing for more kids. All these were pertinent issues from the parents side. It took us one full year to get to know what our parent stakeholders preferences were with regard to their kids’ education. The bottom line is that we must offer a solution to people’s problems, and these end users will ultimately determine the success or failure of your social enterprise. The people we serve are our only sustainable strategic advantage.” – Augustus Kagyene, Curtin Child Learning Center (CLICCS)
“A mistake I made early on was comparing a social enterprise with a corporation. I think this happened without me even realizing at first. Coming from a corporate background, I was making the ‘rookie’ mistake of thinking social enterprises also have a top down structure. It took me awhile to realize that in reality, it was the reverse. Social enterprises are facilitators. The workers closest to the beneficiaries need to receive the support from the rest of the organization in order to deliver services with long term impact in an efficient manner. Therefore the Social enterprise requires servant leadership that understands the crucial role of all stakeholders.” – Gideon Blaauw, Coomacovalle
“A critical aspect of education is that there are many stakeholders. While we wanted to focus on the child as the main beneficiary, the teacher, school leadership, regulators, and parents all have their place in the system. Early on, we were so focused on the children that we didn’t adequately involve these other stakeholders to get them aligned with the vision and model of our program. We realised that each of these stakeholders need to further their own goals, and that we could further our goals by helping them also reach theirs. The challenge that this failure caused has helped evolve our thinking.” – Gaurav, Singh, 321 Education Foundation
“There have been many! A particularly instructive example that comes to mind was overpromising and then ending up both overworking and under-delivering. We’ve learned that clients / partners are very happy with a clear mandate, if delivered excellently. Because we as entrepreneurs know the full potential of our work, it can be tempting to offer it all, but as we learned its much better to start with a do-able scope. ” – Nell Derick Debevoise, Inspiring Capital
Lesson 6: Manage investor relationships and cash flow effectively
“It is equally important to target business & institutional customers as it is to target household customers. Generating enough revenues from business customers can allow social businesses the flexibility to innovate on models of product adaptability for household customers.” – Ziwa Hillington, Green Bio Energy Ltd.
“Another important lesson we learned early on relates to raising money. Investor money MUST be invested directly in the sales (or maybe some marketing) of your #1 revenue driver in order to generate the return on that capital. It’s different from revenue funds, which can be invested more holistically in your business.” – Nell Derick Debevoise, Inspiring Capital
“In our early stage we did not look enough at cash flows and cash flow predictions which made our company almost crash. When we onboarded our first investors, we did not have a clear idea of their role or their preferences for staying informed. In dealing with investors and other share/stakeholders, it is best to inform them of bad news before it happens. If the bad news is a surprise, share it right away to protect trust.” – Guido van Hofwegen, Nazava Water Filters
“We did not think creatively enough about the nature of the resources we would require and from where they come. Early on, when building the organizational blueprint to pitch for investment, we expended finite time and energy into proposals for big donors. For myriad reasons, this effort yielded no results. Thus, we failed to secure the needed investment and squandered time and human resources to lost opportunity costs. Looking back, I can say that this failure was in fact a win. Closed doors inspired us to reflect on how resources come in various forms, which are often interrelated. This reflection gave rise to our seven resource stream strategy celebrated in this recent Spanish language article. It has ended up being the key to our ability to scale. As we write in this piece, “Like many others … in Mexico, we suffer from a complicated public funding climate… and we have not yet been able to secure stable funding sources that will ensure the continuity of all our programs and people over the long term. However, we see these obstacles as opportunities to become more resilient. We have managed to diversify our resource streams through [seven interrelated] strategies.” -Damon Taylor, Psicología y Derechos Humanos PSYDEH A.C.
Lesson 7: Each ‘no’ gets you closer to ‘yes’
“When we first started talking to investors in 2008, when we would say, ‘We believe a business can harness the power of the market for good and use profits and growth as a means to a greater end’ we would repeatedly be met with glazed, confused looks. By becoming a certified B Corp in 2009, we used the B Impact Assessment to verify that we held ourselves to the highest standards of social performance, public transparency and legal accountability to balance profit and purpose. As more investors focused on the impact space, we were ahead of the game and garnered more attention and, therefore, more investment. This shift continues today – we’re seeing top CEO’s, like those at the Business Roundtable, urge firms to take into account employees, customers, and community versus just shareholders – exactly what B Lab and their B Impact Assessment have been doing since 2007. Lesson Learned: Figure out ways to build credibility for your company, and if the timing isn’t right when you first introduce your idea, keep trying. You may be ahead of the times.” – Beth Carls, OneSeventeen Media, PBC
“We have approached numerous organizations (mostly impact investors) to find funds to scale our business and its impact, and until very recently we were unsuccessful. I was told many times by potential investors that Black Mamba was a great project but that we were too small, and that we didn’t need enough capital to be a good investment option for them. However each one of these rejections came with good feedback to improve our business plan, our financials, our network, and to learn more about all the resources available to grow. The lesson is perhaps that each “failure” is an opportunity to learn and improve, and that ultimately that will lead to finding the perfect fit for your business needs.” – Claudia Castellanos, Black Mamba Foods
“Sometime 4 years ago, I tried to Apply for funding from over 15 sources but my applications were all rejected. These failures led me to rethink my approach and enroll in a short course about how to apply for funding. With the knowledge and skills acquired through those courses, I was able to apply and succeed in 3 grant applications.” – Charles Umeh, Parkers Mobile Clinic
As these inspiring examples show, success is not the absence of failure, but rather the ability to learn and grow from it. Reframing failure as a valuable opportunity, rather than something to be ashamed of or kept hidden, will open up new pathways for you to succeed. As Astro Teller, former head of Google X, shares in his TED Talk, “The moonshot factory is a messy place. But rather than avoid the mess, pretend it’s not there, we’ve tried to make that our strength. We spend most of our time breaking things and trying to prove that we’re wrong. That’s it, that’s the secret. Run at all the hardest parts of the problem first. Get excited and cheer, “Hey! How are we going to kill our project today?”
Scaling is hard, and you’ll fail a lot along the way. But stay focused, keep learning, and remember these 7 lessons:
- Focus your value proposition/mission
- Build the right team
- Find the right partners, and invest in building long-term relationships
- Don’t try to grow too soon or too fast
- Involve all stakeholders throughout the process
- Manage investor relationships and cash flow effectively
- Each ‘no’ gets you closer to the right ‘yes’
Need help scaling your innovation? Apply to join S-GRID.