Startups Put on Track for Social Impact
Wednesday, 15th March 2017 at 8:49 am
There is no one right answer, but the question of how to measure a social impact business deserves “robust discussion”, according to a new co-working community for “startups with a connection to good”.
GoodShift is hosting a meetup for entrepreneurs keen to understand what metrics, formal and informal, can be used to track impact, and how to demonstrate their impact to potential investors, funders and customers.
The latest event hopes to bring together social entrepreneurs with experts in the impact measurement space to clarify what it means to be “positively focused” and highlight the importance of accountability and measurability.
GoodShift community manager Kelsie Nabben told Pro Bono News the concept for the event was to help startups incorporate social impact into their business model.
“As a new co-working space based in St Leonard’s on Sydney’s North Shore, GoodShift runs regular events to actively connect and build a like-minded community of positively focused businesses – whether it be not for profit, social enterprise, impact startup, diverse founders or something equally as important,” Nabben said.
“The concept for the event Track Your Impact: How to Measure Social Impact comes out of our desire to support startups to consider incorporating social impact into their business model, and to support social entrepreneurs to better understand different metrics for impact measurement.”
GoodShift Co-working and GoodShift Ventures executive chairman Simon Anquetil said social responsibility needed to be at the core of business.
“Startups, by their very nature, represent enormous potential for impact both as a business venture and for the evolution of ideas,” Anquetil said.
“The importance of social responsibility in modern business practice is well understood, but if you want it to be genuine it needs to be more than just a bolt-on initiative – it has to be embedded in the core of what you do.”
With impact businesses producing both financial returns and positive social impact, the issue of how to define and measure success is much-debated.
To tackle the question GoodShift have invited Impact Investment Group chief impact officer Caroline Vu, Social Ventures Australia head of operations impact investing David Peiris, and economic and social advisory director at Urbis and Social Impact Measurement Network Australia board member Poppy Wise to make up the panel.
Topics set to be covered during the event include what “counts” as an impact business, what impact investors and financial organisations are looking for, how to scale social impact and emerging trends.
Peiris told Pro Bono News in terms of how to measure a social impact business, there wasn’t one simple answer.
“As with everything, there isn’t just one way,” Peiris said.
“There are a number of different tools available, and how and when you use which tool really depends on the nature of the particular business and of the sector they’re in, and the problem they are trying to solve.”
He said measuring impact “made sense” but the framework was still developing.
“I think we have a really mature financial accounting framework about how you measure financial impact but the social impact measurement framework is at a really interesting stage and it is probably where the accounting measurement framework was 100 years ago,” he said.
“So we’re at the stage where there are several ways to measure impact, some are complimentary, some compete with each other to an extent, so it will be a really interesting process to see over time all those different ways align and gel into a more publicly accepted measurement framework, which is exactly what has happened with financial accounting.”
He said as the audience was geared toward young entrepreneurs with startup businesses, he hoped the panel would be able to offer practical tools.
“It will probably be really relevant to have a discussion around practical tools they can use to measure impact, because I imagine they won’t have unlimited financial resources nor unlimited time,” he said.
“So given financial and time constraints and they’re probably trying to setup and run a startup, what are some things they can do to measure impact.”
Peiris said for socially-minded businesses wanting to track if they were “actually doing good”, data was key.
“If you want to measure anything, if you don’t have something to measure, which is data, then you’re not going to be able to do it,” he said.
“So it’s really important to be able to have a good data set so, what I mean by that is, ideally you’d have sort of data from day one, so day one being when you start your business, so your business has not influenced anything, and then perhaps on an annual basis you could analyse that same data set and look to see what has changed and whether that change is attributable to your business having an impact or perhaps whether that change is due to other sources.
“To give you an example, you could look at a particular organisation who employ long-term unemployed people as staff, and you could have a base line data set around long-term unemployed and you could look to see how that changes over time and you could do that analysis in a number of different ways.
“You could just look at the data, you could do some kind of regular survey so you get input from both the beneficiaries, the employees, as well as the management of the company.
“So it is really important to have a data set available, it is important to agree your measures up front and then try to track those measures over time.”
The meet up is taking place at GoodShift House in Sydney on Thursday.
For more information see here.