Asking for money is hard. Founders seeking funding for a new venture often feel like they’re on the losing side of an uncomfortable power dynamic. But any conversation about funding should be as much about the entrepreneur evaluating the funder as the funder evaluating the entrepreneur. Each party has the right and responsibility to vet the other to determine whether goals and philosophies align—and that’s particularly important when you’re a social entrepreneur seeking mission-aligned capital.
Asking yourself and potential funders the following questions can help you find the best match for your social enterprise.
Am I Ready for Funding?
Mission-aligned funders seek founders who are deeply aware of their own strengths and shortcomings and know how to hire other talented people to fill in the gaps. A strong team with the skills to achieve your mission will signal to funders that you can survive inevitable setbacks. Equally important is a clearly defined mission and products or services that express that mission.
Yve-Car Momperousse, founder of Kreyòl Essence, nailed that when introducing RSF Social Finance to her clean beauty company, which works with Haitian farmers to sustainably produce black castor oil for its products.
“The thing that sets Kreyòl Essence apart is that Yve-Car has always had a really clear vision of where she wanted to take the business, not just in terms of financial success but also in terms of the impact she envisioned making in Haiti and the beauty industry,” said former RSF senior credit associate Alexandria Cabral.
You also need to demonstrate that you understand what is happening at your organization financially. If you’re an early-stage social enterprise, having a system in place to track revenue and expenses is crucial. The cost to do it later is significant. This may sound like a given, but I’ve met plenty of enthusiastic founders who can spend all day talking about their mission, but don’t want to get bogged down in the details. If this is you, hire someone to take care of this—financial sustainability serves your purpose.