While in Brazil recently, Howard gave a talk on entrepreneurship that included the inevitable “it’s not just…” reminder. Entrepreneurship isn’t just about start-ups, or technology based ventures, or small businesses, or crazed risk takers, or scoundrels.
And, it’s not just for-profits. Nonprofits, we would argue, are the very definition of an entrepreneur, pursuing opportunities beyond the resources they currently control.
We realized that we hadn’t talked much about entrepreneurship, in our G2G newsletters, and decided to fix that. This month, we’ll consider the essence of entrepreneurship: the pursuit of opportunities. In June, we’ll talk about entrepreneurial management and culture.
The pursuit of opportunities
Entrepreneurship starts with an opportunity. What is an opportunity? That is a two-part answer. Opportunities involve a future state that is different from the present, and a belief that achievement of that state is possible.
An entrepreneur in the nonprofit sector may be working to solve a pressing social problem, address a global health issue, or create better educational environments for children. They all recognize a problem, and believe that they have a solution. They have defined an opportunity.
Clarity about the opportunity is essential for fundraising. If someone hasn’t recognized the problem, you might be able to convince him, though you’d be better off finding people who are already on the bandwagon. (That’s why it’s smart to target people who already donate to similar causes.) The next challenge is to make the case that you have a solution likely to bring about positive change.
A number of factors – all important – impact success or failure in the pursuit of opportunities.
First, opportunity depends on timing. For example, you often see heightened attention to causes and an expansion of nonprofit activities, as a result of crises. Billions of dollars were pledged to Haiti after it was devastated by earthquakes (although it’s questionable how much was actually given, let alone used effectively.) Partners in Health, already established in Haiti, dramatically increased its services.
Second, opportunity depends on the person. How much are you willing to commit? It’s like the story about the chicken, the pig, and your bacon-and-eggs breakfast: the chicken is involved; the pig is fully committed. An entrepreneur, whether in the private or public sector, has to be willing and able to fully engage in the venture.
That said, it’s not all about you. Opportunity also depends on what resources you are able to attract to your enterprise. When people hear “resources,” they usually think “money,” but that often is the least important element. Talent, intellectual capital, information, sweat equity, and networks can be as (if not more) critical ingredients.
Lastly, opportunity depends on the environment. Tough economic times hurt some nonprofit ventures, and help others. As philanthropic resources dwindle, you may need to rethink your economic model, and look at other income generating activities. Or, you may start to look at your “competitors” as potential collaborators, supporting a shared cause.
Many an entrepreneur has pursued an idea that he is sure will be a great success, and source of personal satisfaction. Social entrepreneurs, motivated by the desire to make a positive change in the world, bring a special passion to the enterprise.
Unfortunately, many will be disappointed. Part of the problem, we hold, is a failure to appreciate the distinction among ideas, possibilities, and opportunities.[1]
The entrepreneurial process begins with an idea that addresses some societal need. The entrepreneur must check the idea for economic feasibility and, once satisfied that it is a realistic possibility, for “fit” with his situation and plans. Only then can he be reasonably confident that this is the right opportunity for him, at this time.
Does this ring true, for you? What have you learned about how (or how not!) to be entrepreneurial, in your nonprofit endeavors?
[1] Identifying and Exploiting the Right Entrepreneurial Opportunity…For You
by Howard H. Stevenson, Shirley M. Spence, Dec 12, 2007, HBS Prod. #: 808-043