Social Enterprise 101: Building Earned Revenue Systems
Social enterprises aren't only about earning or diversifying revenue; they’re key to finding creative, sustainable ways to advance your mission while serving your community with dignity.
In this episode of The Small Nonprofit Podcast, host Maria Rio chats with Tom Armitage, who has been leading The SEED, a project of the Guelph Community Health Centre, for almost 10 years. The SEED is dedicated to ensuring that everyone in the community has access to good food, and along the way they have built innovative programming, including a social enterprise, that rethink how nonprofits can deliver impact.
Social Enterprise: The Highlights
Start with Real Community Needs
The SEED was born out of a lack of infrastructure in Guelph. Agencies were struggling with storage and distribution, while people facing poverty were subjected to invasive, stigmatizing processes. Centralizing food storage and access improved both dignity and efficiency.Social Enterprise is Part of the Solution, Not the Whole Answer
From the beginning, The SEED designed a wholesale program that took a small margin on food sales, stretching limited grant further. But Tom is clear - no single program fully funds itself. Social enterprises can reduce reliance on grants, but it does not automatically eliminate the need for funders and donors.Pilot First, Scale Later
The SEED did not dive into big projects overnight. They started small - like testing sliding-scale markets - then expanded when the model worked. This iterative approach minimized risk and made scaling more sustainable.Speak the Language of Business
By talking about margins, efficiencies, and outcomes, Tom found that funders and business leaders connect more easily with The SEED’s mission. It builds credibility and opens new doors for partnerships.Don’t Lose Sight of the Big Picture
Even with impressive growth moving millions of dollars’ worth of food annually, Tom always brings conversations back to the root causes of food insecurity: poverty and income inequality. Programs help, but systemic change is what really solves the problem.
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3 Actionable Tips for nonprofits:
Ask Tough Questions Before Launching a Social Enterprise
Look at your fundraising strategy first and think carefully about your participants. Will charging for a service create barriers? If they aren’t your customers, who is? How will you reach them? Social enterprise should enhance your mission, not compete with it.Start Small, Learn, and Grow
Instead of going all-in, test your idea at a small scale. Use real-world results to refine the model and build a stronger case for funders when you are ready to expand.Frame Impact in Business Terms
When speaking to donors, funders, or local businesses, use language they understand - like ROI, efficiency, and value creation. It helps them see your nonprofit work as both credible and impactful, making them more likely to invest in your mission.
Resources:
Connect with our host, Maria Rio
Connect with our cohost, Tom Armitage
