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West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
West 100224 policy stuff v1
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West 100224 policy stuff v1

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  • The only definitional slide
  • Started Catalyst in 1997, began shift into “social sector” in 1999. Profitable high-growth businesses, no heavy lifting. We are aiming to prove you can make money and generate social impact by backing the best social entreps.
  • We began to be approached by businesses looking for advice, assistance and at times Board members. Like with the Fund, we concentrate on helping leaders to become really successful. In our area, there is loads of attention to the earliest stage social entreps to run with their idea. We felt to create substantial impact we needed to help those with a chance to be very successful—the next Body Shop.
  • The only definitional slide
  • I always try to answer the question asked—especially when the guy asking them is 6’8”
  • The only definitional slide
  • The only definitional slide
  • The only definitional slide
  • The only definitional slide
  • The only definitional slide
  • The only definitional slide
  • The only definitional slide
  • The only definitional slide
  • The only definitional slide
  • David’s second request was that he asked me to discuss my own personal journey within the context of the above. What I would like now to do is to briefly point out my background and how I decided to apply it to this new field—became a social entrepreneur for social entrepreneurs
  • Transcript

    • 1. The first marketplace for social business & enterprise, commerce and investment<br />Overcoming Barriers to Social Investment: Achieving the Highest Social and Financial Gains—Investigating Current Policy Developments and the Future Policy Horizon<br />Rodney Schwartz<br />CEO<br />Westminster Briefing<br />24 February, 2010<br />
    • 2. Overcoming Barriers to Social Investment: Achieving the Highest Social and Financial Gains—Investigating Current Policy Developments and the Future Policy Horizon=What can Government do to accelerate the Social Economy?<br />
    • 3. My background: A “financial guy” seeking redemption (and fun) in social investment<br />financial sector and investment<br />social investment <br />1980<br />2008<br />1999<br />2008<br />1999<br />1980<br />
    • 4. ClearlySo: A social business & enterprise, commerce and investment marketplace<br />ii<br />Social Enterprises<br />Suppliers<br />Investors<br />
    • 5. Social businesses and enterprises on the site<br />17% of businesses on site are non-UK based (as of Jan 2010)<br />
    • 6. ClearlySo is expanding outside of the UK<br />
    • 7. Catalyst Fund Management & Research <br />Raising £40 million from institutional investors in Europe to back high-quality social businesses focused on four sectors: Health & Wellness, Education & Training, Ethical Consumerism and Energy Efficiency<br />Clear measurement of “social impact”<br />Managed by team of professionals (not me, but I founded the business in 1997)<br />
    • 8. Catalyst Strategy Advisors<br />
    • 9. So let’s look ahead at the outlook for social enterprise funding<br />
    • 10. Changes to social enterprise funding: A Strategic View<br />sources of funding<br />types of instruments<br />delivery mechanisms<br />conditions<br />
    • 11. What is the background at present for social enterprises?<br />62,000 SEs in the United Kingdom; growing fast as a sector in size and importance<br />Very much the “flavour of the month”; popular with politicians across the political spectrum<br />Largely government-backed; although foundations are increasingly involved<br />Levels of funding have been microscopic to date<br />
    • 12. 1. Future sources of social enterprise funding<br />The Government is in a very tricky position:<br />It is in bad financial circumstances and in denial <br />However, it wants to and needs to shift expenditure towards the social enterprise sector<br />Financial institutions are unlikely to fund SEs:<br />Partly because they cannot and partly because they will not<br />“Ethical” institutions may make up a small part of the gap, but these are often Government funded <br /> Individual investors will be “the answer” <br />
    • 13. What do we mean by individual investors?<br />social businesses<br />individuals<br />government<br />financial institutions<br />
    • 14. 2. What sorts of instruments will predominate? <br />Grants — probably will decline in importance:<br />Govt problems and issues for foundations<br />The grant process is structurally challenged<br />Loans — also an awkward form for SEs:<br />Many lack repayment or servicing ability<br />Traditional lenders are belatedly “gun-shy”<br />Equity — an essential role to play<br />Hybrids — also will feature due to increasingly complex needs and desires<br />
    • 15. The Case of HCT Group <br />Background: HCT is a large and successful social enterprise operating community transport services in Hackney, Yorkshire and elsewhere. It was seeking to broaden its funding sources from sole reliance on lease finance<br />We have been advising the company and in mid-February will close a round of debt and hybrids (quasi-equity) of £3-5 million, backed largely by ethical investors who see this as an emerging “benchmark” transaction<br />
    • 16. An aside on this issue of complexity<br />Risk<br />Risk<br />Social<br />Impact<br />Return<br />Return<br />And let’s not pretend we understand what we mean when we discuss social impact<br />
    • 17. 3. How will the funds be delivered?<br />Traditional intermediaries — I doubt it<br />Ethical financial institutions — Yes, but limited<br />Advisers — Absolutely; especially for HNWIs<br />Direct via introduction — most certainly<br />Angel investment clubs<br />ClearlySo “Social Sector Speed Dating” (Epona)<br />Direct via the internet — Absolutely!!<br />
    • 18. Ethical financial institutions — Yes, but limited<br />Advisers — Absolutely; especially for HNWIs<br />Direct via introduction — most certainly<br />Angel investment clubs<br />ClearlySo “Social Sector Speed Dating” <br />Direct via the internet — Absolutely!!<br />
    • 19. Applying the lessons of Zopa.com and Justgiving.com to social investment<br />Zopa does peer to peer lending and has enjoyed rapid growth since its inception<br />Justgiving has facilitated over £500 million in charitable giving; over £189 million in 2009<br />Many businesses are seeking to copy this success in social investing:<br />ClearlySo<br />MyC4<br />Mission investing<br />
    • 20. 4. What sorts of conditions will pertain? <br />Governance<br />Transparency<br />Clarity<br />Professionalism<br />“Pitching” ability<br />
    • 21. My personal journey: What can I do to make social entrepreneurs more successful?<br />Be aware of limitations:<br />Environmental <br />Resources<br />Time<br />Talents (we all have some)<br />Get started<br />Regular checks on how things are going<br />
    • 22. Thank you.<br />Please feel free to get in touch!<br />Rodney Schwartz (rod@clearlyso.com)<br />Twitter: @rodneyschwartz<br />The Social Business Blog (www.clearlyso.com/sbblog) <br />

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