The Social Business Model Canvas (SBMC) for social enterprises

The Social Business Model Canvas (SBMC) is a strategic management tool designed specifically for social enterprises. Unlike traditional business models, which often focus solely on profitability, the SBMC integrates social and environmental goals into the business strategy.

This framework helps social enterprises create a balance between achieving financial sustainability and delivering social impact. Below, we explore the key components of the SBMC, real-world examples, and how you can apply this model to your startup.

key components of the social business model canvas

The SBMC comprises nine building blocks, each addressing a critical aspect of a social enterprise. These components are:

1. social mission

• This block outlines the core social or environmental problem your enterprise aims to address. It defines the purpose beyond profit.
• Example: Toms Shoes’ mission is to improve lives through its “One for One” model, providing a pair of shoes to a child in need for every pair sold.

2. value proposition

• Describes the unique value your enterprise offers to both customers and the community. It combines the benefits for the customer with the social impact.
• Example: Warby Parker provides affordable eyewear and donates a pair to someone in need for every pair sold, blending a strong social value proposition with a commercial one.

3. customer segments

• Identifies the different groups of people or organizations you aim to serve. It helps tailor your products or services to meet their specific needs.
• Example: Grameen Bank targets low-income individuals in Bangladesh, offering microloans to help them start or grow small businesses.

4. channels

• Outlines how your enterprise will deliver its value proposition to customers. This includes distribution methods and communication channels.
• Example: Ben & Jerry’s uses retail stores and social media to engage with customers and promote its social mission of environmental sustainability.

5. customer relationships

• Details the type of relationship you will build with your customers, from personal service to automated interactions. It emphasizes how you will engage with your target audience.
• Example: The Big Issue, a magazine sold by homeless people, fosters relationships by providing sellers with a means to earn a living and engage with the community.

6. revenue streams

• Specifies how your enterprise will generate income. This can include sales, grants, donations, or other funding sources.
• Example: Patagonia generates revenue through the sale of outdoor gear while also supporting environmental causes through its 1% for the Planet initiative.

7. key resources

• Identifies the critical assets needed to operate your enterprise, such as human resources, physical assets, intellectual property, and financial resources.
• Example: The Acumen Fund relies on a network of impact investors, skilled staff, and partnerships with social enterprises to achieve its mission of alleviating poverty.

8. key activities

• Describes the main actions your enterprise must perform to create value and achieve its social mission. This includes production, problem-solving, and network management.
• Example: Ashoka, a global organization supporting social entrepreneurs, engages in activities such as identifying and supporting innovative social solutions and building networks of changemakers.

9. key partnerships

• Outlines the relationships with other organizations, stakeholders, or partners that are crucial to your enterprise’s success. Partnerships can help share resources, reduce risk, or expand reach.
• Example: The World Wildlife Fund (WWF) collaborates with companies, governments, and local communities to advance conservation efforts and achieve its environmental goals.
  

Applying the social business model canvas to your startup

To effectively utilize the SBMC for your startup, follow these steps:

1. define your social mission

• Clearly articulate the social or environmental issue your startup addresses. Ensure it resonates with your target audience and stakeholders.
• Action: Conduct research to understand the needs of the community you want to impact. Engage with potential beneficiaries to refine your mission.

2. develop a compelling value proposition

• Create a value proposition that integrates both your product or service benefits and the social impact. Ensure it distinguishes your startup from competitors.
• Action: Test your value proposition with potential customers and stakeholders to validate its effectiveness and appeal.

3. identify your customer segments

• Determine the specific groups you will serve. Tailor your offerings to meet their needs and preferences.
• Action: Use surveys, interviews, and market analysis to define and understand your target segments.

4. establish your channels

• Decide how you will reach and deliver value to your customers. Consider online platforms, physical locations, or partnerships.
• Action: Choose channels that align with your customer segments and ensure they are cost-effective and efficient.

5. build customer relationships

• Develop strategies for engaging with customers, building loyalty, and fostering long-term relationships.
• Action: Implement feedback mechanisms, personalized communication, and community-building activities.

6. create revenue streams

• Identify diverse revenue sources to sustain your operations. Consider a mix of income streams, such as sales, grants, and donations.
• Action: Develop a financial plan that outlines projected revenue and funding needs. Explore various funding options and revenue models.

7. allocate key resources

• Identify the resources essential for your startup’s success. Ensure you have access to the necessary human, financial, and physical resources.
• Action: Build a network of supporters, acquire needed assets, and secure funding. Consider strategic hiring and resource partnerships.

8. perform key activities

• Focus on the core activities required to deliver your value proposition and achieve your social mission.
• Action: Develop a detailed operational plan that outlines key activities, responsibilities, and timelines.

9. forge key partnerships

• Establish partnerships that can enhance your startup’s capabilities, reach, and impact. Collaborate with organizations that align with your mission.
• Action: Identify potential partners, build relationships, and negotiate mutually beneficial agreements.
  

Real-world examples of social business model canvas in action

1. Ecolab

• Ecolab, a global leader in water, hygiene, and energy technologies, uses the SBMC to integrate sustainability into its business model. Its social mission focuses on improving environmental stewardship and public health.
  Ecolab’s value proposition includes innovative solutions that address water and sanitation challenges while generating revenue through product sales and services.

1. Social Enterprise UK

• Social Enterprise UK is a network supporting social enterprises across the UK. Its SBMC emphasizes creating social impact through advocacy, networking, and support services.
  The organization generates revenue through membership fees, events, and consulting services while maintaining a strong focus on social mission and community engagement.

1. Kiva

• Kiva is a global microfinance platform that connects lenders with entrepreneurs in developing countries. Its SBMC integrates a social mission of alleviating poverty with a value proposition of providing accessible loans.
  Kiva’s revenue streams include operational support from donations and partnerships, while its key activities involve facilitating loans and managing a global network of borrowers and lenders.
  

Implementing the social business model canvas for your startup

1. engage stakeholders early

• Involve potential beneficiaries, partners, and investors in the development of your SBMC. Their feedback will help refine your model and ensure it meets community needs.

2. pilot and iterate

• Test your SBMC through pilot projects or small-scale initiatives. Use insights from these tests to adjust your model and improve its effectiveness.

3. measure impact

• Develop metrics to track both social impact and financial performance. Regularly assess and report on your progress to stakeholders.

4. build a strong team

• Assemble a team passionate about your mission and equipped with the skills needed to execute your SBMC. Foster a culture that aligns with your social goals.

5. leverage technology

• Utilize technology to enhance your operations, reach more customers, and measure impact. Digital tools can improve efficiency and scalability.

6. seek partnerships

• Collaborate with organizations that share your mission and can provide resources, expertise, or access to new markets.

By integrating these components into your startup’s strategy, you can create a robust business model that balances social impact with financial sustainability. The Social Business Model Canvas is a powerful tool for guiding social enterprises toward achieving their missions while maintaining a viable business.