Social Enterprise for Communities

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Scottish Transition Gathering

19th November 2010

Tom Black



Overviewy W hat is community enterprise?

y W hy bother?

y Some examplesy Exercise 1 is it for us?

y Common success factors

y Common pitfalls

y Exercise 2 - S WOT

y Sources of further support & finance



What is community enterprise?y Trading for community benefit

y Fusion meeting social mission AND earning income

y Not for private profit, but FOR PROFITy Carried out by community-led organisations

y Self-help ethos - communities themselves are the bestagents of their own renewal

y Creating wealth in communities, and keeping it there.



Why bother?y Surpluses can be re-invested in further community

initiatives

y Supports the organisation over the long-term by reducingrisk to core operations and building reserves

Free working capital no strings attached

Effort goes into creation of long-term revenue streams not

grants that need to be applied for again and again The cuts!

In short, moves us towards financial self-sufficiency necessary for sustained change



Why bother? Local empowement and pride builds a healthy, confident,

can do culture

Builds profile, credibility and support - with funders,partners and your community

Increased community involvement e.g. volunteers

A springboard for further ideas and activities widercommunity renewal!

Attract further investment Increased skills and abilities of community

In short, builds capacity and changes attitudes



Sector sizey 500 development trusts in DTA UK membership 150 in

Scotland

y W orking in communities that make up a quarter of UKpopn.

y Collectively own £0.5bn in assets

y Total income over £250m, earned income over £100m

y

Employ 4,500 staff y O ver 17,000 volunteers









Exercise 1 is it for us?In groups of 3 or 4 discuss:

y Does it square with your organisations mission and

ethos?y W hat enterprise opportunities exists in your

community?

y W hat is the social need (mission)

y W hat is the financial opportunity (market)



Common success factorsy A clear value--led mission and set of priorities developed

by the community

y

Clear legal model and governance structurey Strong leadership

y Constantly developed in--house capacity business skills

y Understood the importance of transitions

yStrong working relationships with local agencies

y knew how to actively engage with their community consensus building



Common success factorsy Have an investment strategy, and know this may

conflict with profit maximisation. NB diversity of

projectsy O wnership of an important asset

y Learn from good practice

y Plan ahead

y Dont wait for the right time



Common pitfallsy Feasibility bias

y W rong asset

y W rong skillsy Lack of leadership

y Didnt get balance right between mission and market

y Grew too fast too soon

y Unclear purpose

y Didnt build local support



Legal structuresUse most appropriate structure

y Company Limited by Guarantee

y Company Limited by Sharesy Charitable status

y Community Interest Company

y Industrial and Provident Society

y Bona fide

y Community benefit society

y Limited Liability Partnership



Exercise 2 - SWOTChoose an enterprise idea.

In pairs, discuss:

y W hat strengths does your organisation hold in relationto this?

y W hat are the weaknesses in your organisation? (howready are you?)

y W hat are the opportunities?y W hat are the threats?



SummaryDo you:

y Understand what community enterprise is?

y Feel there are benefits to this approach for yourcommunity or cause?

y Understand the pitfalls and success factors?

y Have a community enterprise idea that you want to

take forward in your community?y Know of examples you can visits / research?



Some sources of f inancey Big Lottery Fund

y Climate Challenge Fund (?)

y

Esme Fairbairn Foundationy CA R ES replacement scheme

y Loans e.g.y Social Investment Scotland

y

Triodos Banky The Co-operative Bank

y Community share or bond issue

y Other investors, e.g. Empower Community



S

ources of further supporty Development Trusts Association Scotland www.dtascot.org.uk

y First Port www.firstport.org.uk

y SENScot www.senscot.net

y Social Enterprise Academy www.theacademy-ssea.org

y Local People Leading www.localpeopleleading.net

y Social Firms Scotland www.socialfirms.org.uk

y Community Energy Scotland www.communityenergyscotland.org.uk

y Community R ecycling Network Scotland www.crns.org.uk

y Community R etail Network www.communityretailing.co.uky Community W oodlands Association www.communitywoods.org

y Community Transport Association www.ctauk.org

y ScottishLeague of Credit Unions www.scottishcu.org

y Scottish Association of Farmers Markets

www.scottishfarmersmarkets.co.uk

Documents

Social Enterprise for Communities