The 10 Essential Steps To Successful Social Entrepreneurship

Jeffrey Hollender–founder of Seventh Generation–knows a thing or two about starting businesses that do well for the planet and the bottom line. These are his tips for doing it right.

The 10 Essential Steps To Successful Social Entrepreneurship
Flickr user hig_37

If anything is going to jump-start America, it’s the next generation of entrepreneurs. But, sometimes, we entrepreneurs need our own jumpstarting. That’s why I’ve put together some advice for entrepreneurs out there, based on my personal experience (from the first business I started at the age of 14 to today).


First, seven things to remind yourself of every day:

Your passion: Only do what you’re deeply passionate about. There will not only be bumps in the road, but trenches that look like they have no bottom. If you’re not doing what you love, there will be too many opportunities to give up.

Your mission: the change you want to see in the world that your business will impact–and make sure you can measure your progress.

Your vision: Protect your vision by maintaining control. Money always comes with strings attached. Make sure you know what they are.

Your partners: Find the partners and collaborators who know how to do all the things you don’t know how to do.


Never give up.

Never give up

Never give up

With those in mind, here is the essential guide to successful social entrepreneurship in 10 steps:

Business as a system of nature

Systems thinking is an essential framework based on the belief that the individual parts of anything can only be fully understood in the context of the relationships they have with other parts of the system of which they are a part.


Find and hire the right people

It’s the best investment you can make. Always hire people who are smarter than you are. Make sure they are committed to the success of the business, and not participating for their own success.

Choose your investors with greater care than your friend

Once you take their money, it’s almost impossible to get rid of them – but, they like to make sure they can get rid of you. At an absolute minimum, talk to three other CEOs who have taken money from the potential investor. They should tell you what the experience has been like.

Radical transparency is the key to authenticity, and authenticity is the Holy Grail of good business

Be honest till it hurts. Be honest all the time. Share the good, the bad and the ugly.

Measuring what really matters

Measure what matters to your stakeholders, not just what matters to you? Make the measurements meaningful. Make measurements against predetermined goals.

Get out of your own way

Leadership is an art. Ask questions, don’t always provide answers. Invest in your own growth. Stay humble and get humbler.


Ownership matters

Business must stem the dangerous concentration of wealth that emanates from a world of employees who have little or no stake in the companies for whom they work. Owners perform better than employees. Every employee should be an owner.

Corporate governance is important

It’s boring, but critical. Your by-laws should include sustainability standards, diversity commitments, how you will report on corporate responsibility, equity in compensation and what type of open dialogue you will have with your stakeholders.

There’s no such thing as a free market

Make sure that you understand who has the deck stacked in their favor. At Seventh Generation, we sold tissue paper made from recycled fiber. The U.S. government provides more than $1 billion annually to subsidize the virgin fiber industry, making recycled fiber appear artificially expensive. (For more details, check out the Friends of the Earth Green Scissors Report for a complete rundown of “bad” government subsidies.)

Good vs. less bad.

We’ve come to confuse “good” with less bad. Paper towels made with recycled, non-chlorine bleached fiber aren’t good, they’re less bad. So are organic vegetables grown in China and flown to the U.S., hybrid cars, or even a bicycle if it’s made with the wrong materials. There are “good” products, but they are few and far between. Locally grown, organic, grass-fed beef that builds up the soil and sequesters CO2 qualifies. Buying used clothing at Goodwill, or taking a course at your local community college, as long as you get there on public transportation.

Make sure that your enterprise introduces something good, not just less bad.


This post originally appeared on Jeffrey Hollender’s blog.

About the author

Jeffrey Hollender is co-founder and former CEO of Seventh Generation. He is the author of the bestseller, How to Make the World a Better Place, a Beginner’s Guide, as well as five additional books, including The Responsibility Revolution and Planet Home