Cohort 1 of the Upshift program had its first session for the sixth week on August 7th, 2021. The focus of the session was on developing a cost structure and increasing revenue for their projects.
Mr. Jerry, their instructor, began the session by asking the students to turn in the assignments they had received the week before. After that, he began the day’s lesson. He started by stating that many social ventures fail within the first three years because the founders do not factor in the cost of creating the products and services promised in the value proposition. What is the revenue and cost structure, for instance? Mr. Jerry defined cost structure as “the various types of expenses a social venture (for-profit or nonprofit) incurs.” Every social enterprise is different, but the majority of them have two types of costs: fixed and variable.
He also walked the attendees through the steps of putting together a cost structure. To begin, write down the cost of each item that will be required to complete the project. Second, calculate the average market price/rate for each item you’ve listed. Third, calculate the total cost of all of the listed items, as well as the total cost of each item in the quantity. The trainer explained to the students that revenue is the amount of money that is brought into a social venture through its core activities. He went on to say that whether you’re running a non-profit or a for-profit business, you’ll need this. Bootstrapping, banks, and other sources of revenue were mentioned.
Mr. Jerry concluded the class by advising participants to take some time to consider the various sources of funding and revenue streams. They also need to connect with people and organizations in their area who can assist them in gaining access to funding sources and expanding their revenue streams. The class was tasked with going over their stakeholder worksheets again and selecting and combining various sources of funding and revenue streams for their social ventures. The class ended on this note, and some students stayed behind to further research their solutions before heading home.