In the UK, there are a million young people who are not working, not at school and not in any other sort of training. With few opportunities to improve themselves, these teens and 20-somethings risk becoming a lost generation.
The UK is letting potential talent go to waste.This might seem an odd opening for an article in corporate venturing, but the corporates can really do something to help.
I am not just looking for funding that has the potential to be returned, but I also want to tap into your business brains, your experience and your leadership skills.I am the chief executive of Big Issue Invest (BII), the social investment arm of Big Issue magazine sold by the homeless.
We provide finance to social enterprises – businesses that solve social problems – and we have invested more than £18m ($25m) to date in enterprises that include chef Jamie Oliver’s Fifteen restaurant, which offers apprenticeships to marginalised young people; social care organisation Turning Point; and War Child, which is expanding its work rebuilding the lives of children in conflict zones.
This is not charity – this is different. The enterprises we support are expected to provide both financial and social returns on our investments. It is a tough expectation, but we work hard to make it happen.
We have just launched a world first: the Spark Corporate Social Venturing Challenge, which will invest £500,000 in 10 early-stage social enterprises as well as providing them with mentoring and business support to ensure they are resilient and effcient.
These enterprises will be using technology to help some of those million young people who are not in employment, education or training. They will be assisting young people to improve their academic achievements, combat emotional issues, increase confidence and get into work.
We might invest in a start-up enterprise such as Future First, which mirrors those fee-paying-school old boys’ networks by building online communities of state school alumni and sells access to the portal to schools.
Or we might support We’re Altogether Better, the trading arm of award-winning charity BeatBullying. This organisation develops and sells to local authorities, schools and youth organisations proven digital support programmes such as CyberMentors, a peer support social network which gives advice to young people about bullying and violence.
This Spark Corporate Social Venturing Challenge has already attracted big-name partners.
Our principal partner is the Nominet Trust, a foundation established by one of the world’s largest internet registries. Software provider Salesforce and outsourcing provider Mitie have also signed up as founding partners.
We are looking for other imaginative and ambitious corporates to get involved. We want you to provide £50,000 ($80,000), which can be in the form of either a contingent loan to BII with repayments linked to the returns generated from the investments in the social enterprises, or a grant.
If you provide a grant, any returns generated from the investments will be reinvested in the Big Issue Group. Investments in the social enterprises will be in the form of a convertible loan which has the potential to be converted into a revenue participation stake.
Through our unique waterfall payback structure, Nominet Trust is our “first-loss” funder, meaning the money raised from our corporate partners will be paid back first.
In return, Nominet Trust will get a 60% share of any additional surpluses, corporate partners will get 25% and the remaining 15% will be reinvested in the Big Issue Group to boost its work with homeless people and social enterprise development.
The social impact of the enterprises you support will be reported to you through our social impact index.
Furthermore – and this is what makes the programme such an interesting proposition – we are offering you the opportunity to be involved in the selection and mentoring of the winning investees.
This means you can develop the leadership and mentoring skills of your own workforce by teaming them with some of the most exciting social entre-preneurs in the country where they will gain hands-on experience of developing a business proposition from the bottom up.We have a good track record.
This programme builds on the last Spark Challenge in which we selected and supported 33 high-potential early-stage social enterprises working with homeless people.
We assisted more than 6,000 vulnerably housed people, created nearly 700 jobs and built £8.9m in total social value. These figures are validated by accountant PricewaterhouseCoopers.
We think this is a great way to extend the boundaries of philanthropy and to do something new with the money, skills and talents of our leading businesspeople. Corporates can be a powerful part of the solution.
To find out more about the Spark Corporate Social Venturing Challenge, contact Nigel Kershaw, chair@bigissue.com, or Mayhul Gondhea, programme manager, mayhul@bigissueinvest.com (telephone +44 (0)20 7526 3439).