What even is a social enterprise? Join host Mariam Waliji as she chats with Rachel Berdan on this very first episode of Pollinating Purpose. Together they will discuss some of the defining characteristics of social enterprise, how the intentions of social enterprise and social impact organizations differ from other business models, and some of the common questions that come up when starting a social impact organization.
This episode features Rachel Berdan, VP of Transformation & Community-Based Economy at Pillar Nonprofit Network as this month's guest. Listen in to learn about foundational understandings of what a social enterprise is, why you're not alone if you're confused by them, and how to decide whether your organization is or can be a social enterprise (spoiler: the answer is likely yes).
Resources
Music
Intro and background music written and performed by the wonderful Jessica O'Neil.
Find her as Yessica Woahneil on music-streaming platforms.
Sponsors
This podcast is made possible in-part through the generous in-kind sponsorship of Rogers TV London and financial contributions of Libro Credit Union.
35:58
SPEAKERS
Rachel, Mariam
00:00
Music: Pollinating purpose a caring approach to business theme music by Jessica O'Neil
Mariam 00:37
"Not everything that can be faced can be changed, but nothing can be changed unless it is faced." A quote by the visionary James Baldwin. Welcome to Pollinating Purpose: A caring approach to business by Pillar Nonprofit Network. I am your host and constant adventurer Mariam Waliji. Also am the Social Enterprise Program Manager and Coach here at Pillar Nonprofit Network. For those of you who are new here, which will be everyone because this is our very first episode, Pollinating Purpose is a show about supporting organizations who seek to have impact in the work that they do. Whether nonprofit, for profit or grassroots organization, you'll learn the key considerations to starting or growing your social purpose business with longevity and sustainability in mind. Along the way, you'll also hear stories from folks who are doing similar work in their community, and hearing from leaders in their fields on how to best approach this work. Today, I am so so thrilled to have our very first guest as my friend colleague and director, Rachel Berdan. Rachel is an organizational strategist and heart centered coach with over 10 years of experience in the impact sector. Rachel joined Pillar in 2019 for B Lab where she built strategy and capacity to grow B Corp, brand awareness and Canadian identity within the B Corp movement. Previously, she was the chief operating officer for rTraction, a London Ontario based creative marketing agency and B Corp. Rachel holds an MA in global leadership from Royal Roads University, and has navigated significant changes in leadership and hard pivots throughout her career. Rachel has developed the capacity to not only bring clarity and stability during internal change, but also spark innovation and collaboration in service of shifting systems. This is one heck of a bio and it honestly doesn't even begin to cover how wonderful and incredible Rachel is. I am so very fortunate to have Rachel as a leader, a friend and a colleague and my work. My understanding of how to coach and how to facilitate learning around the topic of social purpose, business and social enterprise has been deeply and positively impacted by her presence in my work. She is one of my favorite people, as well as one of my dog's favorite people. I'm thrilled to welcome Rachel Berdan. Hi, Rachel. Hi, Miriam, thanks for being here. Thanks for having me. And welcome to the very first episode of Pollinating Purpose.
Rachel 03:17
I am thrilled.
Mariam 03:19
Thank you, you have been along on this journey for a long time.
Rachel 03:22
I sure have.
Mariam 03:24
And I am very grateful for that, too.
Rachel 03:27
Me too.
Mariam 03:28
Um, okay, so very first episode, which kind of means we're just going to get into like, what social enterprise is what it can mean, all of those questions that you and I both get asked a lot. So let's just kind of start with that. Like, what is social enterprise?
Rachel 03:48
What is social enterprise? I mean, it depends who you ask is usually the first thing that I say. And it depends what sector that person's from, because we have different definitions depending on where we come from.
Mariam 04:02
So what does that mean? Essentially, the sector a person works in will influence the priorities and values someone might have when thinking about social enterprise. There are so many facets to what a social enterprise is, and can be, and depending on what a sector typically considers important, will influence how a person working in that sector, defines social enterprise. The traditional for profit, high growth business sector will look at things really differently than a social service nonprofit.
Rachel 04:35
From my perspective, though, it's really you know, it's finding that space between how you make your money and where you find your impact and and how those things intersect. It's not new by any stretch of the imagination, and in fact, you know it many spaces, it is simply how business is done and how community is done in terms of, you know, finding livelihood and considering the planet and considering community in a good way, you know, shared prosperity in that context, that sort of thing. But if somebody were to ask me, you know, what, like, what counts, it's really where the impact and how the work is done, and how you make your money are inextricably linked. The difference being, you know, like in a, in a for profit business with a, you know, CSR program, a corporate social responsibility program...
Mariam 05:48
CSR, corporate social responsibility, the words all make sense. But do they basically, think of CSR as a branch arm or social purpose initiative of a corporation, maybe a certain telecommunications company comes to mind, Rachel dives into it a bit further. But what really distinguishes a corporate social responsibility model format of a social enterprise is the relationship of the social impact to the rest of the operational and values model of an organization. In a CSR model, the day to day operations or values of an organization don't necessarily reflect the values or intend to have the social responsibility work. With the social enterprise, this social element is foundational, it informs the entire model of the organization and influences how decisions are made.
Rachel 06:43
That's really great that organizations do that. And it's not necessarily part of the DNA of the whole organization, it's a very kind of specific program that has energy dedicated to it, around community impact, but that community impact isn't necessarily deeply embedded in the way that the business functions or in this sort of charity, nonprofit space, it's that sort of, you know, selling T shirts as a as an awareness building or fundraising activity. But that's, you know, T shirts aren't really the impact that you're trying to create in the world. So, you know, again, those are really important activities, but maybe not necessarily exactly a social enterprise. But where we see those business activities, money making activities and community impact piece, really, inextricably linked, I think is at the heart of what social enterprise is all about.
Mariam 07:34
Yeah, I think, and I can't remember exactly what it was that you told me, we have many a conversation. But one of the things that I've sort of built from conversations with you is like, this idea that the impact that an organization wants to have informs all of the decision making around, you know, the service and the product that they're selling.
Rachel 07:56
Exactly.
Mariam 07:57
That's how they're connected, versus, yeah, that, you know, that CSR approach or the means to an end, in terms of raising money is something that isn't actually a core part of the organization. Which yeah, and I think you touched on a really great point about social enterprises, and that it's different depending on who you talk to. Which is because it's not a legal structure. It's, it is a definition or I guess, a categorization of how you choose to operate your business, but it's not a structural piece. Okay, so what are some examples of legal designations? There are sole proprietorships, partnerships, nonprofits, or even a cooperative. All of these are types of organizational structures, and could also theoretically be a social enterprise.So, you know, thinking about that, and knowing that, and what do you think are some key considerations to think about when starting your social enterprise?
Rachel 08:59
So I mean, I think, I think in all sort of, or in sort of dominant, I guess, I would say, entrepreneurial spaces. So often, the question is, what problem are you trying to solve? And I think that's a really important one, I think, some added layers, or some really important layers that are not unique to social enterprise, but I think are really important to consider as well as like, what problem are you trying to solve, but also, why? What's your relationship to that problem? Are you thinking about doing for or doing with.
Mariam 09:34
Quick aside. So this idea of doing for or doing with is so important as we talk about the social enterprise, and social impact space. Sometimes the philanthropic model can have a saviorism approach that is deeply harmful. When the beneficiary of the work that you're doing is a community or group of people that you don't belong to. It's absolutely vital to validate the needs that you're addressing. So what does that mean? It means building relationships and trust with the people you're aiming to support with the work that you're doing. It means listening to their needs, and working alongside them to address the issue, rather than simply offering a solution.
Rachel 10:19
You know, that sort of thing. And and as you get a few layers deeper into, I think answering some of those questions in a good way, then I think you start to get to what, what do I actually need in order to get where I'm trying to go? So, so you're right, there is no, there is no true legal structure for social enterprise. They can be for profit, they can be nonprofit, they can be cooperatives, cooperatives can be for profit and nonprofit, it's very complicated. I'm not a lawyer, I usually tell people that they should probably talk to one.
Mariam 10:54
Do I like to think that I have all the answers? You bet. Do I? Absolutely not. Some of the most common questions I receive from folks looking to develop a social enterprise model, center around what type of legal structure to have, whether for profit or not for profit, how their taxes will work, things like that are. All completely valid questions, and ones that I can't really ethically answer. A lot of the answers to these types of questions involve legal considerations or tax implications. And I just don't have that expertise. As you start to develop your social enterprise, it's helpful for to know who you need to talk to you to get the information you need, if that's something that you need help navigating a social enterprise coach, such as yours truly can help.
Rachel 11:44
But I mean, really, if you if you know, what you're trying to do, why you're trying to do it, who might need to be involved, how you might want to make decisions that can help to kind of narrow down at least what directions you might want to, you might want to go in terms of, you know, the legal governance structure that will serve that purpose and get you where you're trying to go.
Mariam 12:11
Yeah. And yes, yeah, definitely some of those conversations require people who are very skilled in ways in which, you know, a coach wouldn't be. Like it involves lawyers, it involves accountants, there are ramifications of making those decisions, or not necessarily ramifications, but the impacts of making those decisions that you'd want to be well versed in that, yeah, that really decide, you know, how your organization or business operates in, in the ways to serve the mission that you have.
Rachel 12:43
Exactly. And actually, I was just talking to someone earlier today about it's not exactly the same, but we were talking about the social finance space, and how really like law hasn't necessarily fully caught up with where the moment that we're in right now. And so, and I think that applies to social enterprise to some degree as well, we don't quite have legal structures available to do what I think so many, so many folks want to do. And so I think it is, it's important to, you know, I think coaching can be really important in terms of helping folks figure out where they're trying to go and why they're trying to get there. And sort of what's really important, and then, you know, lawyers can really help with like, but this is what you can do within the context of what we're, you know, what we're navigating, and where it's actually possible to shift around the systems as they are in this moment. Okay, so we've sort of already touched on this, I'll reiterate it again. So we can maybe answer it in a different way. But, you know, like how our social enterprises different, you know, from other models, you we've talked about the cooperative we've talked about, you can be a non for profit, or a for profit, social enterprise, like, how does that how does it all work? And, you know, how can they be similar? Like, how can they all be social enterprise? And what are some ways in which they're, they're different as well? So I think, you know, where social enterprise is maybe different from traditional for profit business is really that impact first piece, and where social enterprise is a little different from your sort of traditional charity model is the earned revenue piece.
Mariam 14:34
Not sure what earned revenue is sit tight, we are getting there.
Rachel 14:39
And the earned revenue you know, certainly charities are moving more and more toward that sort of earned revenue piece as well recognizing that we do need to diversify you know, for the sake of financial sustainability of an organization so we can continue on with mission. You know, here at Pillar we do we talk about like shifting to the middle. So recognizing that those are two, you know, different ends of a spectrum. And there is, you know, we're in a place of kind of readiness, you don't have to be either or there's, there's a space for those two pieces to connect. So really, it's, I think, what is different in particular about social enterprises? Really that sort of impact, and, you know, financial sustainability to continue on with, with the work in a good way.
Mariam 15:34
Just because we know, we know that social enterprise is potentially a new term for a lot of folks. When we talk about earned revenue, can you like expand a little bit more? Told ya.
Rachel 15:47
Yeah, so we're talking very specifically in the context of charities. So I think a lot of us are probably familiar with donations. So that's one way that you can, you can receive funds. As a charity, there's, you know, sponsorships as well as is another is another sort of avenue. Grants are another sort of avenue, and I, you know, truly this language is weird to me, because it's all earned. Like, human energy goes into creating those, those opportunities to earn funds. But also, yeah, when we're talking about earned revenue, another way to think of it as like, money that comes in through what you might think of as sort of more traditional businessy means. So it's in exchange for a product or service. In, you know, in a different way than sort of outlining in a grant proposal. What's, what's going to be delivered? It's all kind of weird and messy,
Mariam 16:55
Aren't we all?
Rachel 16:56
Because like, human energy is at the heart of all of this work.
Mariam 17:01
Yeah. I mean, this is why, you know, when we talk about social enterprise is complex and it can be nuanced. It's because I often feel like this, you know, this term sort of social enterprise has ended up being like a little bit jargony. And very much like a sector piece, where, as you were saying earlier, like, you know, this way of doing businesses, it's been around for a very long time. It is the core way of operating for a lot of different communities. So yeah, trying to find that balance of, you know, it's community care at its core is like, you know, the community is a part of what, or I guess, the benefit to the community as a part of what makes a social enterprise or organization who's grounded in social purpose successful like that is a key element.
Rachel 18:01
Yeah. Well, and I think, I mean, building on the community aspect, too. I mean, there are so so many folks who start something for community benefit, who may choose not to register as a charity, for a lot of reasons, any number of reasons. First of all, it's expensive. And it's a lot of work. And there's a high degree of accountability, of course, but there are a lot of barriers to registering as a charity as well.
Mariam 18:29
Some of these barriers are things like the cost, as Rachel mentioned, the flexibility around decision making, and the speed at which you can adapt, and also needing to participate in systems that are inherently a part of being a charity.
Rachel 18:47
And, and it's not, it's not the right model for a lot of things. It is the right model for some, and that's cool, too. But you know, having having some degree of flexibility in terms of going about solving problems, and in a slightly different way than maybe the model might, the charitable model might make it sort of easy to do is is, is I think, a big piece, I think there's, there's so much permission to have impact in a different kind of way, in the social enterprise model. There's an opportunity to approach in a really entrepreneurial sense and pivot with the changes that will simply will show up when you're intentionally working with community once you start to engage with folks in a meaningful way. Exactly how to approach solving the problem emerges in a in a in a whole different way than you might consider before you start engaging with stakeholders. So being being able to start in kind of a more informal way is really, really useful when it comes to that sort of comes to the community development and community care lens and, you know, I think it's just, you know, like I said earlier, you know, we we don't, we don't have to be in an either or space, there's a there really is a space for kind of both that sort of impact and financial sustainability piece.
Mariam 20:21
Yeah. And I think you know, the piece around one model might not be the best model for someone, but it could be for someone else is, is such an important piece, because so often, I feel that folks are either expecting to be told what the best option is, or they are being told what the best option is. And both of those are really difficult because, you know, it's not a decision for anyone else, it's really a, you know, what is the best thing for you, your organization, the changes in the community that you want to have, and you know, the outcomes that you're looking for. That's what makes something better or less than better? You know, I'm great at this. But you know, that idea of like it, what makes something better or less than ideal for someone is going to be a very different parameter from one person to the next from one organization to the next. So, yeah, we can't be very prescriptive about it, because it's so subjective. Okay, so now kind of leaning into some pieces that we mentioned in your bio of your 10 plus years in this space and your time coaching. So as someone who has coached social enterprises, having previously been in my role as the Social Enterprise Coach here at Pillar, what are some of the first questions that you get asked from folks seeking support?
Rachel 22:01
I mean, one of the first questions I almost always would get asked was, Is this a social enterprise? Which, you know, often, I think we've, we've kind of said this in a number of ways, but it's sort of, you know, sure, if you want it to be, you know, with the exception of a few, you know, if there's, you know, extraction in your industry name, probably, it's going to be really hard to get around to making that a social enterprise. With the exception of a few very clearly and very, like, essentially extractive and exploitative industries. Yeah, it can be, again, if you're, if you're earning if you're if you're using business strategies, and you're earning money in a way that is inextricably linked from, you know, to your to your impact, then yeah, sure, it can be. So that really was, you know, the first questions,
Mariam 23:00
I like to call this the Choose Your Own Adventure approach. It's this understanding that you know, your organization best, if you're intentional and aware of your impact, and you want to call your organization a social enterprise, then, Heck, yeah, you're a social enterprise.
Rachel 23:19
The other one is we, you know, it was our opening question, which is, what even is a social enterprise? And what is the right legal structure? We did talk about that a little bit, too. And then, you know, honestly, a lot of it is, am I doing this right? And I think that's where the personal relationship with the impact that you want to have in the world is such an important piece of social enterprise development. Because the answer, if you're truly, you know, seeing, and particularly directly impacted by by the problem that you're trying to address, but seeing a problem and, and really connected with that in a deep personal way, and have a deep personal why attached to, you know, seeing a gap in the market, if you will, to use that sort of entrepreneurial language then, I mean, you're probably doing it right, to some degree, right? I mean, obviously, it can, it can be helpful to get a little bit of support around, you know, what do I need to think about financially is another piece. And I think, you know, I always come around to well what do you need financially, in order to do what you're trying to do? I think so often in the entrepreneurial space in particular, and I would say, I mean, in I'm, you know, the nonprofit sector is a little newer to me because I came into my work through the private sector, but I think in our space as well. The way that we think about impact is usually is so often funder driven rather than heart driven, which it has its reasons and I get why that is, you know, capacity is tight, you focus where you need to focus. But at the end, and you know, in the entrepreneurial space, so often we grow, because you're supposed to grow, and you get to a certain point, and then you're supposed to scale. I think we come around to, you know, what, what actually feels right for you, again, in terms of the impact that you want to have, and the, you know, the way that you want to have and be in business, have a business and be in business. If you can answer those questions in a way that, you know, you can look at what you're doing, and you can, you know, see the link between what you're doing and feeling aligned to the work, then you're doing it right. So, I know you didn't ask me to answer the question that I most recent, most often get. But I do think it is one of the big ones is like, am I doing this rght? And I think I think it's important. But folks hear that, like if you if your heart aligned, and you're like, you know, able to pay the bills, then you're doing it right.
Mariam 26:24
One of the first questions I like to ask folks who are developing their social enterprise model is, what is your definition of success? For some people, that answer might be financial. But for others, it can look like being able to participate in their community in meaningful ways, or having the capacity both financially or emotionally, to contribute to organizations that are important to them. Everyone's version of success can and likely does look different.
Rachel 26:53
Yeah. And then the other one often is where, where can I get money? How can I get funded? Which has both real answers. And also the question of, you know, how much do you like, how much do you need to do what you're trying to do for right now? Because I think sometimes, again, folks are encouraged to get funding without, because that's the natural next step. And sometimes it's the right next step. And sometimes it's not. So I think those are important conversations, too.
Mariam 27:27
Yeah. Going back to something that you said earlier around, you know, that piece of like, if you know why you're doing this work. Something that I like to ask folks when I start coaching them is, you know, why are you the best person to be doing that? And that's not a challenge. But more yeah, this invitation for reflection. Because typically, you know, if your heart is in the right place, and you know why you're doing this work, it's a fairly easy answer. You know, you either have some sort of like lived experience or lived expertise that makes you a good fit, or, you know, you're seeing the community around you with the community that you're a part of, and want to address that in some way, and you feel like you can, but if you can't answer that, then that's also a good thing to reflect on. Yeah. Okay, so we've talked a little bit, you know, about the time that you have spent coaching, and, you know, that kind of leads to these conversations around, like, changing things and moving things forward, and transformation. So, now at Pillar, what are you doing?
Rachel 28:35
I doing? Yes. So, we've been through some title changes. And so, so by, by way of title, I'm the VP of Transformation and Community-based Economy. And what that actually means is, so much of the work that I'm connected with is certainly your work. With the social enterprise incubator and social enterprise coaching, I get to be connected, you know, arm's length to some of that work. I'm also connected with VERGE Capital, our social finance program, the Women of Ontario Social Enterprise Network, which is a province-wide program, supporting both direct, you know, capacity building or direct support for social entrepreneurs. And, and also working with folks who provide support to entrepreneurs to help them understand maybe different ways of thinking about the way and how they, how they approach their work. So, so providing that, you know, one on one connection to folks who are starting something, as well as supporting some necessary systems change in terms of, you know, kind of how we approach and think about business through an intersectional gender lens. And, yeah, so I get to touch all of those programs, and try to connect them back to our mission as an organization, our strategic plan, and ensure that we have a good sort of two way flow around, you know, we have many years of providing support to charities and nonprofits and, and moved into social enterprise a few years ago, you know, continuing to really do some network building and, you know, engage in some some good movement within the sector, I hope, as we listen to folks who directly need our support, and and consider, you know, what else we can do as an organization as we listen to and learn from the communities that we engage with.
Mariam 30:53
To sum it up, Rachel is a kind and wonderful human who is doing some really cool and incredible work.Perfect, thank you. Um, okay, so I say, I have written down here, but normally, we asked, folks, you are my first episode. So in the future, I will be asking folks to share a bit more with the audience about where they can find out more about their organization, I kind of cover that for pillar. So instead, can you share a social enterprise that you know that you support it that you care about that you appreciate? And where they can find out more about that social enterprise?
Rachel 31:38
Yeah, so as I was thinking about this, there was, I mean, of course, I've had the benefit of connecting with numerous social enterprises in my own work. And I continue to hear about great organizations both through the work that you do, and that we do through VERGE Capital, and through WOSEN. And many of the other connections that we have in community and I tend to operate that way anyway. But Salt Leisurewear, where's the first first organization that came to mind for me, and they do I mean, it's kind of what it sounds like leisure wear, active wear. And, and particularly, they have a line with a sort of adaptive clothing for folks who have medical devices. And that's something that's actually near and dear to my heart. I have a loved one who may need those items someday. And he's, he's not quite in their age range in this moment. But one day, I think he'd be right in their target market. So very near and dear to my heart. And I think a really cool one because they have, they are a VERGE investee. So a great way to find out more about them is to visit the VERGE capital website, and check out the story about them. They also went through the Libro Social Enterprise Incubator, you and I coached them together, actually, as we were transitioning our roles and, and have also been connected to the Women of Ontario Social Enterprise Network. So it's a great blend of like, personally, I care about the work that they're doing. And they recently did a pop up in our in our physical space as well. So I think also a great example of kind of making really honestly, I think, good, good use of the of the various supports that Pillar offers as well.
Mariam 33:28
I would agree. Okay, amazing. Thank you so much, Rachel, as you know, I am always thrilled to speak with you, and thank you for being our very first guest.
Rachel 33:41
Thank you so much, I've been looking forward to this for some time, and I am thrilled to be part of it.
Mariam 33:48
Okay, so I have one more question. It's one that we want to be asking everyone, before we sign off. Can you share one thing that is bringing you joy in this moment, it can be anything off the top of your head. First thing that pops in.
Rachel 34:05
You won't be surprised to hear that it is my dog. This morning when I was leaving the house, he did not want me to go he ran into a box as he was saying goodbye to me and then began limping like something had really transpired in a big way for him. So I stayed for another five minutes gave him some Snuggles. I left the house and my husband texted me to say that he's walking just fine. So.
Mariam 34:34
He's the best. Rachel's dog's name is Falkor. And he is just as magnificent and magical and absolutely delightful as his namesake. Thank you once again to Rachel Berban, Vice President of Transformation and Community-based Economy here at Pillar Nonprofit Network. And if you'd like to learn more about Pillar as an organization and the work being done, head on over to our website at pillarnonprofit.ca. And thank you again for joining in on the first episode of Pollinating Purpose, A caring approach to business. And once again I am your host, your guide, your business bud, Mariam Waliji and it has been a pleasure getting to chat with you. Thank you for joining us on this ride, and we'll catch you next time.