Social Enterprise
A social enterprise is a business that prioritizes social, environmental, or community impact alongside financial sustainability, often operated by or connected to a nonprofit.
A social enterprise is an organization or venture that uses business strategies to achieve social, environmental, or community objectives. Nonprofits may operate social enterprises to generate earned income that supports their charitable mission — such as a job training program that runs a restaurant, or a conservation nonprofit that offers eco-tourism.
Why It Matters for Fundraising
Social enterprises diversify revenue beyond donations and grants, creating earned income that's less subject to fundraising cycles and donor preferences. A successful social enterprise can fund a significant portion of a nonprofit's operations, reducing dependence on charitable giving while directly advancing the mission. However, launching a social enterprise requires business skills, startup capital, and a willingness to operate in a market environment.
Considerations
Key factors include mission alignment (the enterprise should advance your cause, not distract from it), financial viability (it must be sustainable as a business), tax implications (unrelated business income may be taxable), and organizational capacity. Not every nonprofit should run a social enterprise, but for the right organization, it can be transformative.