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Internal dialogue

New research commissioned by The School for Social Entrepreneurs(SSE)* reveals that social entrepreneurs seeking training: ‘overwhelmingly want to hear from expert practitioners from their own sector‘.

Survey respondents reasoning is that: “They value the hard-won experience of someone who has already walked the road they are following, who understands the particular challenges faced by social enterprises, and who can offer grounded, practical advice and guidance.

On the other hand: “Policy experts and coaches were the least valued contributors to a course.

As someone with over ten years ‘hard-won experience’ of running a social enterprise, I can only hope this is enough to neutralize the effects of my policy expertise. Either way, I certainly wouldn’t deny social entrepreneurs a survey-based opportunity to put the boot into those who choose the moderate regular salaries available for pontificating about and supporting social enterprise, over the poverty and uncertainty usually on offer to those who actually do it.

What I would question is whether social entrepreneurs should be seeking to learn primarily from people who understand ‘the particular challenges faced by social enterprises’. As a fellow of SSE, I’m a big fan of their use of ‘witness sessions’ where students have the opportunity to listen to an experienced social entrepreneurs talking about have they’ve done what they’ve done and got to where they are – before asking follow-up questions on the practicalities. It’s both useful and inspiring to learn from the experiences of other social entrepreneurs. But if you want to run a business that’s successful in its own sector while also being a social enterprise, it’s equally important to learn from people who aren’t social entrepreneurs.

Like most survey respondents, my social enterprise has an annual training budget of under £200. £35 of the £50 we’ve spent on training so far this year went on paying to attend an event on ‘publishing an independent magazine’. We publish one magazine and are looking to publish some more, so it was very useful to find out about how other people running magazines without corporate backing are making decisions about, amongst other things, print vs. digital and choosing their distribution models.

There are some particular challenges we face due to running an independent magazine as a social enterprise – for example, we have actively chosen to produce a magazine with a target market of readers who are unattractive to advertisers – but these are mostly aspects of our business that we know a lot about already.

There is great value in social entrepreneurs getting together to congratulate each other on successes, and commiserate with each other on the difficulties of running a social enterprise but it’s equally important to get together with, and learn from the experiences of, other people in our professional sectors to work out how to be as good as we possibly can at the stuff that we actually do.

There’s also plenty to learn from other people who aren’t social entrepreneurs and don’t work in our particular professional sector but do have experience of dealing with similar practical challenges to those that we face. The most useful of the various social enterprise mentoring experiences I’ve had was a mentoring relationship with someone who worked a large private sector company involved in public sector outsourcing. They provided invaluable practical tips on project development and negotiating consultancy rates.

Survey responses like this point to the fact that many social entrepreneurs regard and value social enterprise as distinct approach to doing business. That’s not a bad thing in itself (it’s a good thing) but if we aspire to being successful businesses that deliver positive change, then it’s important we avoid retreating into a ghetto of smugness oblivious to what we can learn from successful, inspirational people operating in the rest of the economy.

*I was involved in one of the focus groups that fed into this research

 

 

 

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Articles of resilience

The popular notion (without the social enterprise lobby) that social enterprises are better equipped that conventional businesses (or charities) to survive the current economic downturn (and presumably others) is explored in  New Philanthropy Capital‘s report Are social enterprises more resilient in times of limited resources.

The starting point for the report is a wider  evaluation of the work of the School for Social Entrepreneurs (SSE). While that evaluation clearly provides valuable and statistically meaningful data on the impact of SSE’s work on its students – and their impact on the wider world – the attempt to compare experiences of SSE students to those UK businesses and charities without usefully comparable data is statistically flimsy. The ideas are interesting, though.

Writing on Guardian Social Enterprise Network, the report’s author, Eibhlín Ní Ógáin, suggests that social enterprises are more resilient (less likely to go bust) in times of hardship because “social enterprises have a diverse mix of funding. Yes, they rely on commercial income but substantial proportions come from public sector grants and contracts as well as grant-making trusts.”

She adds that: “It is interesting that it is not the commercial activity per se that lies at the heart of their success but their ability to balance commercial income with traditional charitable sources of funding, particularly in the start-up phase.”

One reality that this alludes to is that it’s easier for a (not-for shareholder profit) social enterprise to generate, for example, £100,000 a year than a conventional small business if that social enterprise gets a £25,000 grant to support its work. Despite the fact that the days of organisations getting grants simply for turning up and doing good work are mostly behind us, it’s still true that if a funder pays upfront for you to do lots of activity you’re usually – though not always – in a better position than a company that has sell all its goods and services to commercial clients.

This is really a point about a socially enterprising approach, though, as opposed to the characteristics of self-styled social enterprises or social enterprise model (in the unlikely event that social entrepreneurs could come anywhere near agreeing on what that model might be). Charities that take a socially enterprising approach, whether or not they choose to call themselves social enterprises, have the option to trade, access a bigger range of grants than CICs or companies limited-by-guarantee and also to get gift aid on donations.

There are, though, a few clear advantages – in terms of surviving a recession rather than in terms of general effectiveness – that organisations with non-charity social enterprise structures are likely to have.

One is that social enterprises are more likely to have executive directors (and are often very small companies, most of whose employees are executive directors). In that situation, it’s far easier to stave off short term financial problems by delaying wage payments. And, even when wages are being paid, in many cases social enterprise directors are (relatively) happy to take lower than voluntary sector market rate wages in exchange for the extra autonomy afforded by not having to answer to a volunteer board of trustees.

A second factor – connected to the first – is that in a social enterprise the outlook of the people taking the decision about whether the company continues to trade is different. It’s a caricature to suggest that charity trustees are conservative and terrified of risk but their responsibilities (as custodians rather than active participants) are different and, clearly with many exceptions, they’re more likely to prioritise an orderly winding down of a charity over a period of months than to keep battling away until they’re forced to stop.

For executive directors of (particularly small) social enterprises, who risk losing both their job and their hopes of delivering the social mission which caused them to start their business in the first place, the incentive to carry on through the pain for as long as they possibly can is much greater. The job factor also applies to the directors of conventional small businesses but they don’t have the added emotional pull of the social mission to contend with – so may be more likely to go off and start another business that sells things that people do want to buy.

On that basis, there clearly are logical reasons why social enterprises might be more likely to battle through the economic downturn than conventional businesses or charities. I’m not sure if those reasons necessarily do much to promote social enterprise as a career choice, though.

 

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Living and learning – a year at SSE

Last Thursday was my final day at the School for Social Entrepreneurs. We still have our graduation ceremony to go but the one year course is now over.

As Claudia Calahane points out in a thoughtful recent piece on social enterprise training for The Guardian: “When it comes to social enterprise training, the SSE will often be the first name on many people’s lips.” Having been started by (Lord) Michael Young in 1997 – a few years before the politicians had worked out that social enterprise was the answer to everything – and building on Young’s own experiences as a serial instigator of enterprising projects to deliver social change, SSE has a justified reputation as the market leader in providing aspiring social entrepreneurs with ideas, practical tools and confidence to get on with doing whatever it is they plan to do.

It’s not a course in the way that the university-based courses mentioned in Calahane’s article are. There are no essays or exams. You graduate and become a fellow of SSE by virtue of turning up to at least 80% sessions. The major point of the course is to learn both from the stories and knowledge passed on by social entrepreneurs who’ve been there and done it (or been somewhere and done something) and from each other.

I was unusual in coming to SSE as a relatively experienced social entrepreneur. Out of my group of 20 ‘block’ students – we did the one year course in blocks of three days as opposed to attending once a week – four or five were people who’d been working on their projects or running their organisation for several years, while the other 15 students had either just set up their organisations, or were just about to set it up at the beginning of the year.

SSE caters for a wide age range and the focus tends to be on helping people who have come to social enterprise after some experience doing something else. This meant I was in the interesting position of being both one of the youngest people in my group and also one of the most experienced in the world of social enterprise.

Being a few years down the social enterprise road meant some of the sessions that would have been phenomenally useful when I was first started – such as the guide to manage finances – primarily served to provoke rueful thoughts of how much better it would’ve been to know then what I know now. But the ‘witness sessions’ with social entrepreneurs (from a range of sectors) talking about their experiences and answering questions were both enlightening and inspirational.

The point is not that you learn anything theoretically extraordinary. For example, most TV shows about business will waffle on about the importance of taking risks but that’s not quite the same as hearing Greenworks‘ Colin Crooks explain how he took on a contract to recycle the office furniture for a major bank, despite the fact that at the time his company consisted of him, a work experience kid and a small hired van. And there’s plenty of books about promoting a positive culture in your organisation but that’s not quite the same as going to Happy, taking in the bright yellow decor and hearing Henry Stewart talk about what he does and why.

Ultimately, I think all education that works, works partly because it gives you something to fall back on when you don’t know what to do next and you’re in danger of losing faith in yourself and your abilities. Trained medical staff obviously need to be able to fall back on the knowledge that they are practically competent in the work they do and that they have a certificate to prove it.

It’s a different for entrepreneurs, and it’s different kind of different for social entrepreneurs. What unites social entrepreneurs and conventional entrepreneurs is that one of the biggest determinants of success is how much you want it. That’s not because popular symbols of entrepreneurial  ‘for realness’ such as emoting your passion and wearing your mission on your sleeve are necessarily going to make you any better selling your goods or services . They might or they might not. It depends on what you’re selling and who you’re selling it to.

‘Wanting it’ matters because striking out on your own is always going to be difficult and if you don’t really want it, it won’t take too many missed dinners before the call of the steady salary becomes too powerful to resist. For conventional entrepreneurs, the desire for some combination of money, power and acknowledged success may be enough to keep you going when you’re down to your last tin of soup. For social entrepreneurs, there’s a fair chance you’ll never get any of these things even if your enterprise does really well.

So what you need beyond a desire to change the world is some people to show that changing the world is possible and explain how they did it, and some other people to share your pain as you try to follow their example. That’s what you at SSE.

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Small and a bit frightened

I spent Monday and Tuesday managing the delicate balance between running a social enterprise and attending the major conferences where people talk about social enterprise.

Usually even the best social enterprises conferences feature 75% overly positive non-specific bullshit and 25% interesting discussion. This year’s Good Deals and Guardian Conference seemed different. While much of the bluster was still there and the flurry of exciting new financing models continues unabated, the underlying atmosphere was a bit less smug and bit more thoughtful. There seemed to be fewer gratuitous potshots at public sector bureaucrats and less about how social enterprise definitely was the solution to most (or all) of the world’s problems.

I think the main reason for this change in mood is that many leading figures in the social enterprise movement are worried. Some are worried that their organisations or many of the organisations they represent could go bust during the next 12 months, others are more generally peturbed at the possibility that social enterprises might really be saddled with the responsibility for filling the hole left by massive cuts in public services.

The biggest hint at this growing climate of fear was the fact that most platform speakers at both conferences were acknowledging that most social enterprises in the UK are really, really small. That’s not a major revelation but the fact that it’s being openly acknowledged by leading figures in the lobby and social finance world is a major shift from the years of “our surveys reveal that 110% of people are absolutely desperate for a social enterprise to collect their rubbish”.

As I pointed out on the Guardian’s new Social Enterprise Network last week, it’s Serco, Capita and friends who will be collecting your rubbish or giving you a parking ticket if the council isn’t. What most social enterprises will be expected to do is to provide the services they already provide to supplement or take the pressure off core public services with less resources than they’ve had previously.

This is likely to accentuate the practically massive but rhetorically under-discussed gap between third sector social enterprises – social enterprises that combine some trading with an enterprising approach to the delivery of (in reality, if not technically) grant-funded activities – and the few social enterprises that are real trading businesses. Aside, from the discussion of whether many social enterprises will be able to win commissioned contracts from councils or NHS agencies competing in a market with private companies, there’s the bigger issue of the services that will just stop being commissioned. Historic conference bluster aside, most self-defined social enterprises will be just unable as charities and other community groups to replace grant or commissioned income with trading activities.

Mixed in with the public funding debate is the question of the role of social enterprise in building The Big Society. While the government’s Big Society adviser and social entrepreneur, Lord Nat Wei, was at Good Deals comparing Big Society to the internet – people couldn’t have imagined 20 years ago how big the internet would be now, the Big Society will be really big in 2030 – lobby insiders suggest that, partly due to his penchant for bizarre metaphors, Wei is no longer on Number 10’s list of top Facebook friends and, while he may continue to advise for some time, that advice will politely ignored by the key decision makers in government.

It’s clear that The Big Society Bank, promoted by Civil Society minister Nick Hurd at both conferences, certainly will seek to make more cash available for investment in social enterprises (and others). What’s less clear is how the emerging Big Society models currently championed by ministers – mostly focused on reduced state support mixed with increased involvement of volunteers and unpaid unemployed people – will enable third sector social enterprises delivering uneconomic activities in the community to generate the cash to sustain their activities and pay the money back.

The good news for social enterprise at the end of 2010 is that both politicians and much of the general public no longer have faith in the public and private sectors to deliver the combination of economic social benefits that everyone wants. The looming bad news is that politicians may expect social enterprise to deliver what they other sectors don’t or can’t but with little or no resources.

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Down in Dartonia

I imagine problems with the Dartington estate broadband system prevented Nick Temple from continuing his insights into last week’s SSE residential. Either way, I’m happy to pick up the baton. I was at the residential as a member of this year’s SSE London block group. While the highlight of my week was undoubtedly joining fellow mental health social entrepreneur, Steve Light, in a karaoke interpretation of Sugarhill Gang’s Rapper’s Delight, my stay in Devon also provoked some thinking about how we do social enterprise.

The Social Enterprise City of the Future format created by the SSE team certainly generated plenty of discussion and – eventually – plenty of productive activity too. Although the situation was a necessarily artificial one, the problems of building groups and forming partnerships with others mirrored those faced by social entrepreneurs in the outside world.

One of the most interesting questions raised by this process was that of how we deal with the challenges that we (social entrepreneurs) encounter when we try to work with each other. There’s plenty of discussion in the social enterprise world about the potential difficulties of working with councils or more traditional charities but if you put together 20 or 30 passionate individuals with a strong motivation to achieve (often similar) social goals in (often very) different ways that poses problems in itself.

My instinctive approach – not especially suited to last week’s challenge – when working on a project involving a large group of people with different ideas about how things should be done is to sit and wait until all the shouting’s over and then try and work with anyone who’s left in the room to do something practical and useful. That’s a reflection of my personality rather than my professional opinion and – in my day job or my real life voluntary roles – I’ve found a little bit of well targeted shouting (or robust point-making) is often the necessary thing to do to break a logjam.

The big problem for my team in the Social Enterprise City of the Future lay in overcoming the challenge of deciding who was in charge and what needed to be done quickly enough for something to actually be done. This is one problem that social entrepreneurs don’t usually encounter when working with public sector agencies or funders on a fairly small scale. It’s usually clear that party (a) has some money and party (b) hopefully has the ability to do something with that money to achieve positive social change, if only they can persuade party (a) to give it to them – either in a chunk or based on some agreed results.

If, as many of us hope, one of the positive by-products of the current economic challenges we’re facing is that there’s more opportunities for groups of social entrepreneurs to get together and make things happen on a larger scale, that we’ll need to deal find ways for lots of people with the drive, passion and ideas to change the world to work together – despite their inevitable differences in experience and approach. That’s definitely a good thing but, last week’s experience (and other experiences in the past) suggest it won’t always be easy.

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SSE in poll triumph while Holbrook walks the line

The results are in. The School for Social Entrepreneurs (SSE), in partnership with Unltd, have come out on top of Social Enterprise magazine’s controversial poll on which Office for Civil Society (OCS) strategic partners should keep their funding when the current list of 42 is culled to 15. As a student at, and all round supporter of, the work of SSE I’m happy with this result although I share the concerns expressed by SSE’s Nick Temple and others about the value of this kind of poll.

While it would be positive – and correct – for the the OCS to look at this result and recognise that large numbers of students at SSE greatly value the support and inspiration they receive during their time at SSE, this doesn’t tell us anything much about the relative value of the work of NCVO – other than perhaps that fewer members of NCVO (which represents a broad spectrum of voluntary sector organisations and doesn’t have a specific focus on social enterprise) read Social Enterprise magazine.

Either way, the debate generated by the poll may have helped to prompt this blog post from Social Enterprise Coalition chief executive, Peter  Holbrook. In a thoughtful and sensible assessment of the current situation he asks:

“So how do we walk the line? How do we effectively champion social enterprise, maintain our identity as an independent movement and both challenge and advise government?”

It’s difficult to disagree with this position but it hints at one of the big underlying problems with the Coalition’s current contribution to the social enterprise movement. I don’t believe that the fundamental problem with the Coalition’s lobbying relationship with government in recent years has been that they’ve been too deferential or should become less deferential.

The social enterprise movement should always be prepared to engage positively with government to deliver positive social change and, irrespective of how bad the cuts get, there’s no situation where I think it would be sensible for Peter Holbrook to go storming into the Cabinet Office berating Ministers for all the bad things they’ve done to social enterprise. It’s right for the Coalition to have a pragmatic approach to the situation facing the social enterprise movement and to make constructive suggestions for what the government can do to help.

The problem under the previous government and the previous Coalition leadership was that high level political discussions around social enterprise were fundamentally detached from the real world of most actually existing social enterprises – in terms of the size, scalability and the sectors they operate in. The discussions focused on how lovely it would be if social enterprises delivered all public services and most of the general public had an active knowledge of social enterprise, while more or less ignore most of what social enterprises were doing and the practical support they needed to do more.

Both the (Social Enterprise) Coalition and the coalition government need to consider how they can focus less on pushing social enterprise as an idea and more on enabling social enterprises and social entrepreneurs to deliver social change. Peter Holbrook is right that he has to the walk the line between challenging and engaging with government but it’s equally important that under his leadership the Coalition develops a more practical vision for what that challenging and engaging is intended to achieve.

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In at number 3

I’m honoured that Nick Temple at SSE has put me at number 3 in his UK Top 10 Social Entrepreneurship blogs. Just below such esteemed commentators as Rob Greenland and Rod Schwartz.  Also pleased to get a mention in a post from Social Enterprise London CEO and fellow new bloggger, Allison Ogden-Newton. All quite exciting, really.

I’m going to one of the SSE’s taster sessions later this week as I’ve heard lots of good things about their courses and I’m aiming to apply next year.

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