Social Enterprise And The Future Of The Third Sector

There is a new wave sweeping this sector by storm, one that is growing fast: Social enterprise.

This for me is the most exciting channel, and one I genuinely think can have the biggest impact. In my opinion, only those that embrace this revenue stream will survive long-term and exist to keep making positive social change.

Forget fundraising, the future belongs to social enterprise.

To clarify, social enterprises are businesses which set up to change the world. Like traditional businesses, they aim to make a profit but it’s what they do with their profits that sets them apart – reinvesting or donating to create positive social change.

There are an estimated 70,000 social enterprises throughout the UK, contributing £24 billion to the economy and employing nearly a million people.

UK social enterprises increased their turnover by an average of 61 percent last year, according to The seventh annual NatWest SE100 Data Report. And growth in turnover for the 100 fastest growing organisations was 932 percent. Pretty impressive stats if you ask me. Especially if you compare that to the Fundraising income for the UK’s top 100 charities, which grew by just 2.3 percent in the year to March 2016, “The lowest rate for six years” according to a report (Civil Society Media Limited).

The future isn’t looking that bright for fundraising, yet so many people are talking about it, what about new opportunities such as social enterprise?

For the past few months I’ve been diving into this sector a little deeper, and I wanted to share three of my favourite examples of social enterprise I’ve come across to date. My main reason for doing so is to help inspire and share these incredible stories.

My full list goes on and on, but these three really struck a chord with me, mostly because of their incredible journeys and whilst I briefly touch on them below, I do urge you to read up on their stories and follow them in the future; as I for one am extremely excited to see what’s to come.

One of the most impressive examples I can name would be the partnership between Belu and WaterAid.

Belu started with a simple idea – that there was a better way to do business by reducing their environmental impact and using all the money they make to fund clean water projects. They trade with the purpose of investing 100% of their profits into ending water poverty through their exclusive partner, WaterAid.

They brought the commercial knowledge and contacts to the table, and simply used the money they were earning to help fund WaterAid initiatives; as they were the experts on the issues and how to solve them.

An incredibly powerful partnership. But it wasn’t smooth sailing form the start; they racked up debts of nearly £2 million before they managed to turn it all around. A story showcasing that with drive, energy and enthusiasm, anything is possible.

One of the more well-known examples would be Toms. Since launch they have honoured their mantra of “one for one”, and 60 million pairs of shoes have been given to children in need in over 70 countries. And this is growing; in 2011 they branched out and since then 400,000 people have had their sight restored through purchases of TOMS Eyewear.

So you have a commercially minded business that is driven by maximising their social impact. And how can you not be impressed by their impact to date?

While this isn’t strictly a social enterprise, a new revenue channel has been born out of a wonderful partnership. Since 2013 these partners have raised awareness of the links between obesity and cancer, inspiring people to eat healthily and become more active. Slimming World has raised over £2 million in funds over the past two years and has been donating stock by recycling old clothes; selling them within their community and using the money to fund Cancer Research.

What a simple, easy initiative; donate your old clothes (that don’t fit anymore) to help fund research into stopping cancer.

We’re entering an extremely exciting era in the social impact sector, and it’s worth ALL charity boards having open and honest discussions about their digital strategy and ways of bringing in revenue to help support their work.

A simple partnership can start a sustainable revenue stream for a social impact organisation and it would be crazy not to take advantage of this. While fundraising will continue to exist, this channel is becoming tired and harder to compete in, so looking at other revenue streams might be the smarter choice for charities.

You don’t have to be a large organisation to do this, it’s starting to happen on a smaller scale too. No matter what shape, size or origin of the business or organisation, there’s no excuse to not look at new opportunities.