Starting a social enterprise

Social enterprises are businesses with a social purpose. They trade in competitive markets and use their profits to help communities


2 min read

1. Overview

Social enterprises are businesses that reinvest all profits towards achieving social or environmental goals. They operate in a range of sectors and can be run under different legal forms. This guide will help you decide whether starting up a social enterprise is right for you.

2. Why set up a social enterprise?

If you want your business to do more than just make a profit, starting a social enterprise may be right for you.

Social enterprises need to generate revenue for sustainability but they also have equally important social or environmental goals. Managing this 'multiple bottom line' - financial, social and environmental - can result in unique challenges. However, bringing about positive change to people and communities can be very satisfying.

Social enterprises are often formed to address a particular social or environmental need. For example, social enterprises often provide employment for people who have traditionally found it hard to enter the labour market, like the long-term unemployed, young people, disabled people or ex-offenders.

Social enterprises can also capitalise on the increasing consumer demand ethically-sourced and produced goods. Highlighting the social and/or environmental credentials of your service/product could give you the edge over your competitors.

3. Financing your social enterprise

A written business plan will allow you to formally present your business to potential investors or loan providers.

You may want to investigate traditional finance providers like banks. Other sources of finance specifically for social enterprises include:

You can also get support from Just Enterprise, a Scottish Government programme offering business support and training for new and growing social enterprises.

Business Gateway offers free help and advice for new businesses. Contact your local office for more details.

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