Talking social investment

By Iona Joy 30 November 2012

Social investment featured heavily in the events calendar this week. ‘Tis the season for get togethers! And there were plenty of good speakers around—presentation skills not lacking.

My week kicked off with a meeting with a charity (can’t name) whose imagination blew my socks off. Very early thinking and will take time to bring to fruition, but exhilarating nonetheless! Talking about a very specific idea and trying to shape it into something was definitely the highlight of the week for me.

The accounting firm, Mazars, then held a provocative round table on Monday afternoon. Great fun. Thereafter, we hotfooted to Social Investment Business’ very jolly birthday party. NESTA and TSRC hosted a thoughtful session on Tuesday afternoon with plenty of debate, and the Good Deals conference on Thursday was very busy and lively. My cup was full by teatime.

And of course, NPC’s own social investment training workshop on 13th December is another hot date for your calendars—after a two-week talkfest break.

But all this talk. What are we saying? And is anyone listening? Here is what I got from this hectic week:

  • Social investment is still a minority sport, even with BSC’s £600m. Whichever way you cut the numbers, whether by civil society income (£170bn) or assets (£228bn), or public spending (£677bn), or social enterprise borrowing (£4bn?), the ‘social investment’ market (£165m) is minute. We still have a long way to go.
  • If we really want to achieve social change, shouldn’t we be ‘socialising capitalism’ as much as ‘capitalising the social sector’? Quite a call to arms!
  • The people affected must drive social impact/value requirements and their measurement. There is concern that government required outcomes are too distant from how beneficiaries value civil society efforts.
  • We must do what needs to be done and measure it, not do what can easily be measured. And you can’t always put a financial price on the value.
  • We need to distinguish between distinct areas of the market:
    • Enterprises—where customers are paying for goods and services they want
    • Public services—where public purse savings are a core driver eg, payment by results contracts etc.
    • Public services—which could be more efficient, but where savings shouldn’t be the core driver, eg, social care
    • Infrastructure—buildings, equipment, IT and so forth
  • We haven’t cracked what motivates potential investors because, guess what, they are all different! So the supply side needs segmenting too, in order to appeal to different types
  • Revenue revenue revenue. Yes, people have got the message that you need to generate revenue in order to have a credible business model, but with public sector spending shrinking, how do you grow that revenue? People are very hungry for ideas. There is lots of talk about setting up ‘social enterprises’, but selling what, I wanted to know? And who is paying? Charity shops are great but we can only be so many before the market is saturated. We need the next Big Idea on this.
  • A big chunk of the market is bound up with commissioning. And that’s another topic, on which more later…..

Now lets bring on the deals….