For Purpose Venture p. 2
Part 2: Starting a for purpose venture? Here’s what to consider after take-off
Once you’ve done the ground work in understanding the people, problem and potential social impact of your for purpose venture, it’s time to start thinking about what the structure of your entity will be.
In the last blog post I mentioned that it is a good idea to work within existing organisations and structures if you can, rather than creating something new for the sake of creating something new. If you decide following on from your research and conversations to start a stand-alone for purpose venture, here are the next steps.
It’s also important to note that this information doesn’t provide every step that you need to engage in along the way and nothing replaces good legal and business advice!
Test your idea
When I was starting For Purpose, I applied for a small grant ($2,000) to undertake a survey and trial the work. This allowed me to see if the idea could have the desired social impact that I was trying to achieve. It also validated my idea and gave me the confidence that I needed to take it further. I wrote about this here.
The For Purpose ‘trial’ allowed me to answer the following questions. Does the idea support the people that it aims to support? Is the idea creating the intended social impact? Is there are need to refine, recreate or extend the idea? Is there a better way to achieve the desired social impact?
Does the idea support the people that it aims to support? Is the idea creating the intended social impact?
Investigate your possible legal structure
If you are creating a for purpose entity, you need to think about the best possible legal and business structure. Will your entity take a business structure or a not-for-profit structure. The decision that you make will depend on where you are undertaking the work and the intention of the work. There is a lot of information available on possible structures. To check out possible business structures you can go to business.gov.au. To find out about not-for-profit legal or social enterprise legal structures check out the NFP Law Information Hub. If you become a charity, you will also need to register the charity with the national charity regulator ACNC.
It is a really good idea to seek legal and business advice. Research into structures is important, but it doesn’t replace good advice from experts. So make sure that you do the ground right and seek the right advice before jumping in.
Will your entity take a business structure or a not-for-profit structure?
Create sound foundations for good practice
Once you’ve decided on a business structure, you will need to make sure that you have the right insurances, accounting processes and policies and procedures to undertake work with sound governance and good processes.
You can find out more about insurances for not-for-profits at NFP Law Information Hub. Our Community also has a great Policy Bank with information and templates for policies and procedures. Business.gov.au has lots of information on business and workers compensation insurance.