Founding and funding a social enterprise requires several practical steps. In today’s episode of Social Entrepreneur, Jesse Finfrock of Morrison & Forester walks us through these steps. With their headquarters in San Francisco, they see a lot of startups take off and other blow up. What makes the difference?
Keep in mind that Morrison & Forester is a global firm, working across a global network of 17 offices located in key technology and financial centers in the United States, Asia, and Europe. Their clients include some of the largest financial institutions, Fortune 100 companies, and leading technology and life sciences companies.
Jesse works with Morrison & Forester in their impact space, where money meets mission. He works closely with Susan Mac Cormac, who popularized the idea of the hybrid corporation – part for-profit, part nonprofit.
Jesse took the time to answer several key question about founding and funding a company. I’ve listed the questions below with a timestamp to make them easier to find in this episode.
Founding and Funding Advice from Jesse Finfrock:
Is there a difference in how you advise startups versus how you advise mature companies? [05:39]
What are some key agreements / assumptions that co-founders should communicate with each other at the beginning? What should be written down and when? [07:48]
What is intellectual property (IP), when do you protect it, and what is the best way to do that? [13:21]
What are some best practices when splitting equity among co-founders? What is vesting and why is it important? [15:43]
When is the right time for co-founders to actually incorporate? Is there a time that it is too early or too late? How do I decide on the corporate form – LLC, Partnership, S-Corp, C-Corp, etc.? [20:44]
What are the stages of financing a social enterprise? [26:40]
What are some pitfalls that founders can fall into in the early days? [28:17]
Key pieces of advice for aspiring or early stage social entrepreneurs [32:35]
Founding and Funding Quotes from Jesse Finfrock:
“Our social enterprise clients actually have more tension in them than our traditional for-profit clients.”
“There are nastier disagreements, and more frequent disagreements in our social enterprises than in our traditional for-profit startups.”
“The social enterprises that we see the most success with are those that have aligned profit-making with mission.”
Throughout the month of April, you can win one of ten one-on-one mentoring calls to help you launch or grow your social enterprise. We’ll be drawing each week. To enter, go to http://tonyloyd.com/coaching