More than a year since the onset of the COVID-19 pandemic, the effects of the crisis are still being deeply felt by many charities across the country. The latest data from Imagine Canada shows the effects of the pandemic: many charities continue to be severely affected while others are doing alright. More than 40% of our local charities still face declines in revenue with the average drop at 44%. 56% of charities are struggling and their recovery is at risk, with many of these facing demands for their programs and services that exceed their capacity to deliver.
Social Enterprise is growing rapidly as one possible solution to this trend. Charities earn predictable revenue through the sale of products or services to paying customers, and become less reliant on funding via grants and donations. All profit from the social enterprise is directed back to the mission of the charity and the vital work they are doing in our communities.
But this is not just another fundraising initiative in disguise. It is a business. And it is not easy to simply shift a charitable culture to a business mindset and expect the dollars to flow in. It takes time, effort, training and mentoring.
To address this, a group of innovative local funders are working collaboratively, alongside their community donation programs, to deepen the impact of their social enterprise support. Five local funders including United Way, Interior Savings, Valley First, a division of First West Credit Union, and the North and South Okanagan Community Foundations pool resources to offer 6-12 months of necessary coaching support to a number of enterprising charities up and down the valley.
This innovative approach started in 2018 when the local United Way spearheaded the Social Enterprise Accelerator fund in partnership with Purppl, a community contribution company and a social enterprise itself. Staying true to their cooperative values, the two local credit unions joined the cause, while the two community foundations, who often share major donors with United Way, also came on board and quickly saw the impact of their joint funding. Since the pandemic, they have renewed and deepened their commitment to supporting local charities in this way. Seeing a need in other communities, the two credit unions have also expanded their work together to include the Kamloops region too.
“This is a unique and innovative opportunity to approach our environmental, social and governance (ESG) practices in a more meaningful way” says Paulo Araujo, President of Valley First. “This approach goes beyond basic monetary support, focusing on helping charities grow a sustainable revenue stream and develop long term business skills. Through working together with other funders we all get to be supportive partners, with regular check-ins and opportunities to champion these social enterprises in other ways”
Since the start of this partnership 26 local charities have been supported through a social enterprise coaching program, via this collaborative funding. The social causes they impact are broad. So far it has supported vulnerable women fleeing abusive relationships, community mental health services, community childcare provisions, men in addiction recovery, employment services for those with disabilities, homelessness solutions, and Indigenous reconciliation training, to name just some.
At Penticton’s Discovery House, Jerome Abraham, Executive Director, says “it has been an extremely valuable and supportive experience, giving us new tools to make key decisions on our social enterprise ideas. Our coaching has helped us clarify the impact we’re trying to achieve, and provided specific one-on-one & team coaching tailored to our needs. We have received support with financial modeling, risk management, task prioritization, and business management that has been invaluable to the success of our Social Enterprise”
Bracelets are created and sold at market prices, new fee for service counseling services are developed, delicious soup is made and distributed to local full paying customers, bikes are refurbished and sold, food trucks earn revenue at festivals. And none of these are one-off “fundraisers”. All are viable, long term businesses with sales forecasts, paid staff, regular customers and profits. But no shareholders, other than the community members in need, who will benefit from the charity’s mission.
When collaboration wins over competition, and innovative funders come together like this, the non-profits reduce their dependence on donations and grants, often in excess of 30%.
“I’ve been 4 months sober since I started helping make bracelets with Jewels of HOPE” says one of the participants of this recently launched social enterprise. “I’d like to do more of this please. It feels good to do something productive like this. Makes me happy. Keeps me focused on good things. Connects me with some great people”
The partners know their work is making a difference when they meet with the charities’ leaders every six months. They reflect on what’s been learned, they open new doors for them in the business world, they share ideas for future growth, and they even purchase services from them as a customer. The call for applications for this year’s Sustainable Recovery Grant is opening on May 24th, 2022 and details can be found here.
The philanthropic world is embracing a different kind of support to make a meaningful and longer term impact on social challenges.. The relationship between the traditional powerful funder and the grateful charity recipient is shifting. Many traditional corporate donors to charities, whether they are public or private institutions, may struggle to understand partnering as a new way of operating, and may not yet have investigated what it takes from them to genuinely support collaborative approaches like this. For these innovative local businesses and funders it was a no brainer once the results started to be apparent.
“This collaboration is in perfect alignment with our values as a local cooperative”, says Karen Hawes, acting CEO of Interior Savings. “Not only has it been an opportunity to learn from each other and build relationships but it’s also helping organizations have greater impact and be innovative in their approach to building sustainable revenue streams. We all have a role to play in the health and well-being of our communities, and as is evident with this partnership, we go much further when we work together.”
All parties involved in this long term model would encourage others, even those they traditionally compete with, to jump on board and start collaborating.
For more information on social entrepreneurship within the charity sector check out www.purppl.com or reach out to firstname.lastname@example.org