“Business Model Analysis”
Background:
In 2012, The Australian Government provided $10 million in seed funding to Social Enterprise Finance Australia (SEFA) with a further $10 million being invested by a range of corporate and individual investors, to seed the $20 million SEFA Loan Fund.
SEFA (http://sefa.com.au/) brings together a range of enterprise partners with expertise in social finance, business development, community development, and research and training. These partners include Triodos Bank, Community Sector Banking, Macquarie Group Foundation, NSW Aboriginal Land Council, and Bush Heritage Australia.
SEFA offers loan products to social enterprises in tandem with targeted business advice and support to help build their capacity to manage debt and become financially sustainable over time. The overall aim of the Australian government in supporting SEFA, is to improve access to finance and support for Australia’s social enterprises to help them grow their business, and by doing so, increase the impact of their work in their communities. By supporting SEFA, the Australian Government is also seeking to catalyse the development of the broader social impact investment market in Australia. The SEFA funds will provide flexible, tailored financial products and support to social enterprises to help them to grow their business and achieve greater social outcomes. The funds do
not provide grants to social enterprises.
The new CEO of SEFA (see Podcast) is keen to see the fund succeed and provide a return on investment (ROI) for investors (including the government).They now need to select the ‘right’ social enterprises to support to ensure money is not lost and the goals of the fund are achieved. There are several social enterprises in Australia that may have a good chance of prospering, if they had additional support. They have been shortlisted in the book “Australian Stories of Social Enterprise” by Cheryl Kernot and Joanne McNeil, who interviewed the CEO’s/managers of each social enterprise. Their stories can be found in a book(which i will upload a file)
There is also further information available on each social enterprise on their respective websites.
TASK:
As a business consultant, acting pro bono, it is your task to provide assistance to SEFA. For the purposes of this assignment, the short list of organizations you may consider is all organizations listed in the book “Australian Stories of Social Enterprises”. ** Please note, since publication, some enterprises have failed, hence, cannot be considered for funding.
SEFA are requesting that you provide them with an analysis of three of these shortlisted
organizations, identifying one for each category (with reasons):
1. Select an organization that you can ‘RECOMMENDED NOW’ – i.e. based on your analysis, this organization has a sustainable business model, competitive positioning, and is likely to achieve a positive ROI and SROI in its current form.
2. Select an organization that you would ‘RECOMMEND WITH CHANGES’ – i.e. based on your analysis, this organization needs to make at least three key changes to its business model, or competitive positioning, or value proposition etc. If it makes these changes, it will likely provide a ROI and SROI in the future.
3. Select an organization that you would ‘REJECT’ – i.e. based on your analysis, this
organisation currently has a weak business model, poor competitive position, and will
provide a weak (or non-existent) ROI or SROI in its current form.
In making your recommendations to SEFA, it is advisable that you consider issues such as:
– their business model (in some cases a diagram may assist)
– an environmental analysis (e.g. life cycle of industry, competitors, role of technology and so on)
– the management and organizational structure and demonstrate they have the necessary
skills available to manage a loan/support from SEDIF (or not)
– the sustainability of their business model and competitive position – i.e. revenue streams, ROI, ability to repay interest and/or principal, ability to capture and measure social impact etc.
In making your recommendations, you may want to refer to other cases, business examples or concepts discussed in class.
This report needs to also be succinct, no more than 2000 words (excluding references). You are also a busy consultant, so in analysing the short list, the organisation’s website, their story in the book, the lectures, assigned readings and case studies from class will provide enough data for your initial analysis to the client (i.e. you do not need to contact the organization).
structure and Formatting(for this report)
1. Introduction (issues with social enterprises); summary of recommendations.(160-200 words)
2. ‘RECOMMENDED NOW’:(500 words)
o Organization
o Analysis
o Conclusion/Rationale
3. ‘RECOMMEND WITH CHANGES’(600 words)
o Organization
o Analysis
o Recommendations
o Conclusion/Rationale
4. ‘REJECT’ (500 words)
o Organization
o Analysis
o Conclusion/Rationale
5. Conclusion (160-200 words)
o Common issues across short listed applicants
o Ways to stimulate/improve the social enterprises sector in Australia
o Advice to SEFA in selection process/awarding of funds
Note:
You need to use appropriate references to support your analysis(argument), so you need to use at least 10 academic reference(journal article,books.etc). I will also upload a file called ‘research help” which will contain some reference, you might want to take a look.
Other background information:
http://sefa.com.au/
Dr Pamela Hartigan, Director of the Skoll Centre for Social Entrepreneurship, University of Oxford (available at:
http://www.ssireview.org/articles/entry/in_search_of_the_hybrid_ideal
http://www.deewr.gov.au/Employment/Programs/SocialInnovation/Pages/default.aspx
http://aph.gov.au/senate/committee/economics_ctte/capital_market_2011/issues_paper/index.htm
http://www.socialeconomy.net.au/
http://www.sbs.ox.ac.uk/centres/skoll/Pages/default.aspx
http://csi.gsb.stanford.edu/
