This document provides an overview of setting up social enterprises. It defines social enterprises as businesses with primarily social objectives that reinvest profits back into the community rather than maximizing shareholder profit. Various business models and legal structures for social enterprises are discussed, including housing associations, leisure trusts, and different types of companies and mutual organizations. Exercises are included to brainstorm uses for an empty garage and evaluate if a social enterprise idea is viable. Contact information is provided for further resources.

1. Setting Up Social Enterprises
Jo Ransom
Director of SEEE
www.seee.co.uk

2. What we will cover
• What is social enterprise (SE) –
definitions
• Exercise – 101 uses for an empty garage
• SE – business models, legal structures
• Mutuals - definitions
• Charity vs Social Enterprise
• Exercise - Has your trading idea got
legs?
• Contact information

3. SE - definitions
• Not one definition
• Not one legal status
• Not one legal structure
“A social enterprise is a business with primarily social objectives whose
surpluses are principally reinvested for that purpose in the business or
in the community, rather than being driven by the need to maximise
profit for shareholders and owners”
“Social enterprise is about doing good business rather than
being more business-like at doing good”

4. Exercise
101 uses for an empty garage
In groups, list all the uses, with a social purpose, you
can think of for an empty garage – get your
entrepreneurial heads on!

5. SE Business Models
• Housing Associations
• Leisure Trusts
• Social Firms
• Development Trusts

6. Legal Structures
• Industrial and Provident Society (IPS – Co-
operative and Community Benefit Society)
• Community Interest Company (CIC – Limited by
Guarantee or Shares)
• Company Limited by Guarantee/Shares
• Trust
• Unincorporated Association
• Charitable Incorporated Association

7. Mutuals
• A mutual is any organisation owned and run for the
benefit of its members; no external shareholders
and can operate as employee owned, co-operative
or wider SE model
• A Co-operative is a mutual organisation run
according to a particular set of 7 principles,
internationally agreed
• In an employee owned business at least 51% of the
organisation must be owned by employees; a
controlling stake in the business

8. Charity and SE
• Charities can have a trading arm (SE) – the SE can
covenant any profit back into the charity
• Charity may be more tax efficient but can be inflexible –
have to stick to primary purpose – cannot deviate
• A prime example of a charity that works effectively as a
social enterprise is Action for Children; in existence for
150 years; 80 to 90% of its income comes from
government contracts providing services for children and
families around social care, annual turnover <£200m as
a result of contracting out services

9. Exercise
Has your SE idea got legs?
• Does it meet a significant need for your potential customers?
• Is the market for your product / service sizeable and/or growing?
• Is the market attractive and accessible?
• What’s the competition, and can you realistically compete?
• Will it require high initial investment
• Is there likely to be a good return on your investment (time and money)?
• Is there good fit with your mission, values and organisational culture
• Does it use/develop your existing skills
• Do you have access to potential partners and support networks?
• How risky will it be and can you afford to take that risk?

10. Handouts
Range of documents in electronic format
‘Is social enterprise the answer for public
services’
‘Social enterprise and governance issues’
‘Legal forms for SEs’
‘SE legal structures, at a glance’
Further information – www.seee.co.uk
admin@seee.co.uk