The Case for a For-Profit Social Enterprise - Part 2

It's been over 8 years since I started, and the biggest concern people raise about my social venture is that we haven't secured significant institutional funding. There are many possible reasons for this. One is that I spent too much time refining our impact model and too little time developing my fundraising skills. Another is the decision to set up CoolCoach as a for-profit venture.

Kevin Starr, the CEO of Mulago Foundation, writes about the Three Buckets of Money, which include a very small pool of "maybe money" for for-profit social ventures. Lying face down in the 'maybe money' desert Kevin describes, I often wonder: if only I had read his articles earlier and challenged my confirmation bias, maybe I would have registered CoolCoach as a non-profit—and maybe we'd be well-funded today. 

It's possible, but being well-funded was never the goal when I set up CoolCoach. Neither was the goal not to be funded! With the benefit of experience, I’ve added a few more reasons to my original list of why setting up CoolCoach as a for-profit was the right decision. Here's what I have learned over the last couple of years.

Outputs Vs Outcomes

Apple’s ‘Think Different’ campaign inspires us to change the world—but Apple’s success is ultimately measured by how many devices it sells, not how many revolutionaries use them. In the social sector, we often obsess over outcomes but fail to define the outputs that lead to them. And without tracking outputs, it becomes harder to iterate, measure, or scale impact. A for-profit model forces us to focus on measurable outputs that drive impact.

Understanding cost structures

In many ways, non-profits are a unique kind of business. You market a vision (the outcome), then sell an intervention (the output) to a funder who often pays upfront. Delivery can be loosely defined, and end-of-year reports often justify shortfalls while making the case for even more funding. This dynamic sometimes leads to a poor understanding of cost structures. As a for-profit, we’ve had to be cost-conscious from day one. 

Employee Learning – Classroom Vs On the Job

In many non-profits, employee learning mirrors academic environments—heavy on theory, light on application. In a for-profit, learning is driven by the need to deliver outputs. This creates sharper, more relevant learning curves, especially in early-stage ventures, where every team member's learning curve directly affects the organization's survival.

Alignment

We don’t talk enough about alignment in the social sector. Many non-profit employees want meaningful compensation—which is fair—but when everyone is looking out for themselves, a for-profit model can better align incentives. Especially in ventures like ours, where, among other things, we train youth for jobs in high-growth industries, the for-profit model just makes more sense. 

Learning to Earn is a skill

I once believed that setting up a hybrid entity or starting with a non-profit and then transitioning to a for-profit would be easy. It was easy because my understanding was all theoretical. When you have to earn, you have to sell something that someone wants to buy. Earning is a skill. So is selling. And both require a mindset you can’t just turn on when convenient. If the goal is to build a sustainable business, it's better to start learning to earn from the outset.

Before I end, I believe it bears repeating that to make a dent against Non-Communicable Diseases, CoolCoach had to figure out a scalable impact model. As a non-profit, we could have figured out a model, but we wouldn't have achieved the kind of scale I had in mind when I conceived CoolCoach. For the kind of scale required, we need access to commercial capital, which is only available to a for-profit entity.

So yeah—with all this in mind, I'm more convinced than ever that a for-profit social venture can drive big, lasting impact. It may not be the easier road, but it’s the one that feels truest to our mission.