Briefing Session for

1. Briefing Session for Call for Social Enterprise Business Proposals To be presented to the Social Investment Forum at the Social Enterprise Summit 2009, November 13 & 14

2. Who should apply • Start-up projects or SE in operation up to 3 years • Investment amount sought between HK$500,000 and HK$2,000,000 • Applicant must be owner/chief manager of the project with or without any NGO affiliations. Projects which have received previous funding from any other sources can also apply.

3. Important dates to note • November 13-14 – Social Enterprise Summit 2009 applicants are strongly recommended to enrol • November 14 afternoon – Social Investment Forum • October 21 – deadline for submitting the business proposal and PowerPoint • November 9 – announcement of results of 3 projects selected for presentation at the Forum • November 9 to 14 – preparation for presentation with support from the Steering Group

4. Social Enterprise definition An organization trying to achieve a double bottom line: • Fulfilling a mission to address a social issue • Achieving financial sustainability primarily through earned income

5. A social enterprise is NOT • A charitable organization or NGO which rely on grants or donations for its operation • An ordinary business enterprise because of its clear social mission • Corporate Social Responsibility (CSR) activities which are funded by corporations and do not generate income

6. Social Enterprise can take many legal forms, such as: • Limited company by guarantee (profits generated cannot be distributed to shareholders) • Limited company by shares (profits generated can be distributed to shareholders) • A subsidiary company under a holding company or an NGO • An independent unit within an NGO with its own Profit & Loss account • Under current HK company law, there is no legal entity of ‘social enterprise’ as such

7. Why should you be interested in submitting your business proposal?

8. Anticipated benefits For those selected to make a presentation: • Recognition as a promising project • Opportunity to present to a large audience, including potential investors • Opportunity to win the Most Promising Project Award of HK$50,000 For anyone submitting a proposal: • Opportunity to be selected for presentation at the Forum • Opportunity to learn how to prepare a business proposal • Opportunity to receiving coaching and support from organizations keen to see successful SE projects

9. A Sample Business Proposal From Food Waste to Money and a Better Environment By Jack Cheng, Tom Pang and Veronica Lam

10. What potential investors will be looking for 2 checklists for reference

11. What needs to be included in your Executive Summary*

12. *Remarks • No more than one page Executive Summary • No more than 3 bullet points per description • No more than 20 words each bullet point

13. What needs to be included in your PowerPoint submission • A summary of your business proposal • A story to tell • A demonstration of your passion and mission, market knowledge, innovative solution, financial viability and implementation plan

14. 8 building blocks of a business proposal • Social problem definition • Mission • Innovative solution • Social impact strategies • Competitor analysis • Financial planning • Social impact indicators • Vision of impact

15. Business Proposal for Social Impact : 8 Building Blocks Innovative Solution Social Impact Strategies Social Problem Definition Mission Social Impact Indicators Vision of Impact Competitor Analysis Financial Planning

16. Social Problem Definition • A concise description of the social problem or issue addressed by the social enterprise • Qualitative and quantitative data showing importance and magnitude of the issue

17. Example from Green Collar “It is a shame to everyone in HK to witness how food waste is being generated daily in huge amount and disposed of in a most anti-environmentally way. More than 3,000 tons of food waste is produced daily, constituting 29% of total commercial and industrial waste, much higher than other wastes like cardboard & newsprint (10%) or plastic bags (9%).”

18. Mission A description of the organization’s purpose, including the target beneficiaries and the activities it conducts in order to address the target social issue, and the outcomes it expects to achieve.

19. Example from Green Collar “Make food waste recycling everyone’s responsibility and turn waste into resources for the benefit of society and economy.”

20. Innovative Solution Innovative and creative design of product/service that address the social issue and generate income and profit in the long run.

21. Example from Green Collar • Collect food waste from catering firms and turn it into organic fertilizers and animal feeds to be sold to local users. • Educate school students to reduce food waste and to choose catering firms that treat food waste properly

22. Social Impact Strategies Key strategies to enable the profitable offering and sale of the product

23. Example from Green Collar • Provide incentive for catering firms to offer their food waste for recycling • Partner with overseas firm with proven technology to turn food waste into saleable products • Partner with NGOs to educate school students to reduce food waste and appreciate the benefits of proper treatment of food waste

24. Competitor Analysis • Identification of current and potential competitors • Analysis of their strengths and weaknesses • How to differentiate from competitors and to create entry barriers

25. Example from Green Collar 5 potential competitors are identified, with analyses of their company background and competitive strategies

26. Financial Planning • 3 to 5 year financial forecast • Breakeven analysis • Payback period of initial investment • Cash flow projection

27. Example from Green Collar • 5-year income statement • 5-year balance sheet • 5-year cash flow statement

28. Social Impact Indicators Measurable indicators reflecting the extent of achievement of the organization’s mission

29. Example from Green Collar • Amount of food waste handled annually and as a percentage of total food waste • No. of catering firms participating in food waste recycling scheme and as a percentage of industry volume • No. of students taking part in educational activities related to food waste handling • Volume and value of products created from food waste

30. Vision of Impact – ‘Begin with the end in mind” A description of how the world will be different when the social entrepreneur is ultimately successful in addressing its target social issue

31. Example from Green Collar(implicit in their business plan) HK as a role model in minimizing food waste and in recycling it for productive uses.

32. Dare to dream. The best advice I can give you.

33. What is missing from the picture?

34. People and action.

35. Business Planning Core Team Board of Directors/Advisors Innovative Solution Social Impact Strategies Social Problem Definition Mission Social Impact Indicators Vision of Impact Competitor Analysis Financial Planning Action While Planning Phase One Implementation Plan

36. Business Planning Core Team • Critically important in the eyes of potential investors • Composition, expertise mix, track record • Working history • Availability and time commitment

37. Board of Directors and/or Board of Advisors • 貴精不貴多 • Ideal size: 3 to 5 members • Relevant expertise and background • Written proof of commitment

38. Action While Planning • Identify and undertake limited projects during the planning period to test out ideas and delivery methods. • Will make the business proposal more realistic and credible

39. Phase One Implementation Plan • Usually covers one year • Must include a set of strategic goals to be achieved within this phase • A realistic projection of the initial investment required • Quality of the Plan could make or break investor’s confidence

40. Sources of Support/Advice • Hong Kong Social Entrepreneurship Forum www.hksef.org • HKCSS -HSBC Social Enterprise Business Centre www.sebc.org.hk • Bright China Group www.brightchinagroup.com • Chartered Institute of Marketing Hong Kong www.cimhk.org.hk

41. A downloadable book Business Planning for Enduring Social Impact: A Social-Entrepreneurial Approach to Solving Social Problem by Andrew Wolk & Kelly Kreitz download from: www.rootcause.org/bizplanning

42. 3 books that you must read • 新愚公移山: 十個社會企業創業者的故事 (2007) • 香港社會企業妙點子 (2008) • 平凡創傳奇 (2008), 翻譯自Everyday Legends: the Stories of 20 Great UK Social Entrepreneurs

43. Thank you and good luck!