BY RICHARD BRANSON
Editor’s Note: Entrepreneur Richard Branson regularly shares his business experience and advice with readers. Ask him a question and your query might be the inspiration for a future column.
Q: I am a social entrepreneur, striving to develop a business in Africa that makes a difference, but my struggle is the same as that of millions of others: finding funding. I come from Denmark, and potential investors always tell me, “The idea is great, but please prove that your business model works first, and then come back.” Should I look abroad for funding instead? — Christian Høegh-Guldberg Hoff, Nairobi, Kenya
More and more often I hear from people like you, who are in our field for the right reasons. It’s very encouraging to see enterprising social entrepreneurs prove that they want to help people and the planet by doing good business.
It can sometimes be more difficult for social entrepreneurs to secure funding than for those proposing to run purely commercial, profit-driven enterprises. Getting your message across to potential investors can be particularly challenging, since they may assume that because you intend to solve a problem or help people, you must be adopting the nonprofit model.
Your local community is often the best place to start when looking for funding opportunities, but if you can’t find anyone suitable to work with, the logical next step is to broaden your search to the national or even international level. And if you do have the option of bringing in foreign investors, this may be to your advantage in the long run. Your business could gain some important contacts, while their outsider perspectives on your business may offer some interesting insights. When you’re ready to expand the business internationally, the process will be a lot easier if you have contacts already in place.