Social entrepreneurs face a myriad of problems including lack of adequate funds and experience in running their businesses. The funding, cash flow management and hiring of qualified and passionate employees are among the common problems that stall most businesses.
Most social enterprises lack funds to implement ideas and strategies to expand. They take time before breaking even, forcing them to remain small for longer. Even though most social entrepreneurs are creative and gifted, some may lack business management experience as a result of a deficiency in skills or knowledge. This impacts businesses negatively, since they are prone to making uninformed choices.
Starting, managing and running a social enterprise can be time and capital intensive. The research and development processes take time, with most startups being new and having untested ideas. Investors find most of them risky and unattractive for short- or long-term returns.
Getting the right teams to work with is another challenge social entrepreneurs face. Founders experience difficulties in finding employees who are talented, who share the vision and who are willing to work for less money in the beginning.
Social entrepreneurs struggle with communicating value objectively while trying to sell products and services. This means they find it difficult to maintain profitability while selling items that are ideally meant to transform social spheres. Social value is not easy to measure, and most entrepreneurs find it hard to describe their ideas to investors or the target community.