In times when blockchain and cryptocurrencies are casting a shadow over banks, Community & Social Enterprise featured as a top five industry in Equity-based Crowdfunding and Debt-based Securities, as well as in both of the non-investment based models (i.e. Reward and Donation) according to the latest findings of a research by Cambridge Centre for Alternative Finance.
To find out more, Oliver* met up with Stuart Emmerson, Regional Director, West Midlands Social Enterprise UK , the UK body for social enterprise to talk about social enterprises, social finance and the role of crowdfunding.
Oliver*: Hi Stuart and thank you for joining us. Innovative finance has been indicated by many as a cross-cutting strategy for change. What role crowdfunding could play in the new fundraising ecosystem from your perspective?
Stuart Emmerson: With banks not lending social entrepreneurs have used ‘the crowd’ to help fund projects that would otherwise have not got off the ground.
Crowdfunding is now a mainstream part of a suite of social finance offers available to those seeking cash.
I think its role is that it’s simply another tool in the box. But it’s no easy solution – it’s hard work and doesn’t always work!
O*: Indeed, it’s hard work but it helps to ease access to finance.
S: I think it can be particularly effective at directly linking in a tangible way the community with a project and can be part of an effective communications campaign to generate interest and support.
O*: Social enterprises are indicated to be leading the way for innovating business in many areas. Yet access to the right finance remains one of the principal barriers to sustainability and growth. How Social Enterprise UK (SEUK) is supporting social entrepreneurs in this respect?
S: SEUK is supporting access to finance by working closely with the social finance sector to raise awareness.
O*: Any example?
S: We partner with Big Society Capital (an independent social investment institution in the United Kingdom, which provides finance to organizations that support front-line social sector entities, Ed.) and other organisations such as Key Fund (a social enterprises investment provider, Ed.) , to run a range of ‘Let’s talk good finance’ events.
O*: What’s the purpose of these events?
S: To help demystify the sector and help social enterprise connect to investors. In fact they offer charities and social enterprises the opportunity to speak to charity and social enterprise leaders who have already accessed social investment, to meet potential social investors, to learn about new social investment initiatives, funds and instruments, to ask questions in a safe and non-judgemental space as well as to understand more about when social investment is not suitable or appropriate.
O*: Are there any additional projects you are working on?
S: We also support the development of the Good Finance website which helps social enterprises navigate the social investment market. It’s a simple, intuitive and free tool for the sector to use.
S: Finally, we are constantly feeding back to the social investment sector our members’ views and experiences of social investment. The market is constantly evolving and there remains a need for investment to find it’s way faster to those social enterprises who need it and for it to be less risk averse and prepared to fail.
O*: UK is viewed by many as pioneering social entrepreneurship as well as digital fundraising. How the two dimensions are contributing to drive change from your perspective?
S: The UK is indeed a leader in social enterprise as well as digital fundraising. These two dimensions are driving change through the opportunity to amplify the transformative work of social enterprises.
For example, SEUK’s digital campaign #WhoKnew helps highlight fundraising campaigns, success stories and best practice. As a sector when we collaborate we have a strong loud voice which can support effective campaigns in the sector.
Digital fundraising is helping undercover ‘hidden gems’ or community projects that would have been difficult to garner support or awareness – digital fundraising is helping change this and as a result giving more chances of success for projects across the UK.