The Funding Canvas

Funders Canvas v1JPG2
The SocialLeanCanvas team and I spent the day on Tuesday working with a large New Zealand corporate that is helping a small but awesome charity. The goal is to help transform the charity into a scalable social enterprise (check it out here).

Too much complexity in Customer Segments

One thing we struggled with during the session was managing the complexity in the Customer Segments box. With Customer Segments defined as “anyone you have to move for your business model to work” this section gets really busy with users, customer, funders, volunteers etc. And of course each customer type has a different Problem and UVP hypothesis to validate.

Complementary Canvases

In a break I was chatting with Joshua Vial from Enspiral who had sketched out some ideas for complementary canvases, one of which being a Funding Canvas. This looks to me to be a good way to keep assumed funders in the canvas as part of Customer Segments (which I think is really important for a social enterprise) but to remove the extra complexity that they generate buy transferring the unpacking and validating of these to a simplified canvas.

Who are Funders?

Just for clarity, when I am talking about funders, I am talking about those people/organisations that will provide initial funding for the venture, the equivalent of investment in a non-social enterprise startup (though this funding may still come in the form of traditional investment). This group is distinct from Outcome Purchasers. I would consider Outcome Purchasers to be like regular customers—we need to validate them through the complete canvas (channels, revenue, costs etc) as normal. But for these initial funders, they don’t need to be scalable and repeatable, we just need to validate that they exist and that we have a proposition that is compelling enough to them, that they will pony up the cash we need. (Note it is still crucial that we validate them, because if they don’t exist or we can’t engage them the whole venture fails.)

Validation

The v1 that I am experimenting with here is super simple. We define our potential funder segments (e.g philanthropists, large non profits, government grant makers etc), then fill out the canvas with our assumptions and validate in the following order 1. Problem/Motivation 2. Funder Segment 3. UVP 4. Opportunity. The way I am testing it is buy keeping all the funder segments on the same Funder Canvas, if it is simple enough, but separating them out to multiple Canvases if things start to get complicated.

I’d love to hear feedback from people trying this method in the field.