Launching the new Social Business Growth Fund
As Chair of WCVA, I was pleased to be able to host the WCVA Social Investment Cymru 10th Anniversary Event and Launch of a new Social Business Growth Fund last week.
It was particularly good to have Jane Hutt AM leader of the House to launch the new £2.3 million new Social Business Growth Fund, backed by £2.3m of EU funds, which will make funding packages of up to £150,000 available to social businesses across Wales. Jane has been a great advocate for the sector but as she highlighted in her presentation we need to do better at telling the story of the impact of the EU supported local funds and the role that social businesses have played over the last 10 years.
It was almost 10 years ago to the day WCVA dipped its toe into the world of lending money, a rather new concept at the time for the third sector, which had three objectives –
To lend where others would not to address market failure
To support the growth of social businesses
And to create a sustainable fund that could re-invest repaid investments
Over the last 10 years WCVA’s Social Investment Cymru fund has directly invested £6.5m into social business across Wales with another three quarters of a million approved and ready for drawdown in the coming weeks.
£3.5m worth of repayments have been received to date, that have been, or will be used for future loans to other social businesses.
In addition, other investment funds have been leveraged for social businesses in Wales with another half a million being invested through the Micro Business Loan Fund partnership with Finance Wales as well as an additional £2.6m into community energy projects through the WCVA fund management work with Energy Savings Trust and Welsh Government.
Impressive as these figures are it is not the total money lent that is the important statistic, but the impact of that investment, as illustrated so well by Anne Marie Rogan of SwanseaYMCA
From looking back over the portfolio, the investments made have supported social businesses to on average grow their turnover by 43%, increase their reserves by 67% and grow their number of employees by 59%.
This is even more impressive when are put into a geographic context.
Over the last few weeks Bristol University have helped WCVA map investments against the Welsh Index of Multiple Deprivation and commercial bank lending data. The maps are clear in demonstrating that the investments made by WCVA have been into both the most deprived areas of Wales and also the areas that receive the smallest share of bank lending. Concrete evidence that we are supporting social businesses to grow and thrive in the areas that need it most.
However the impact of social businesses goes even further as we know they are not only creating jobs and economic value where it is needed most but that they are also often tackling inequality, giving people their first job opportunities or providing vital services that no one else will.
At a time when there is talk of a re-calibration of economic policy at both a Welsh and UK level this data helps evidence the important role that social businesses play in bringing economic revival to some of our most deprived communities.
Getting to this point though has been a real example of partnership and voluntary support. The Wales Cooperative Centre and the Development Trust Association were both central to the creation of the original fund and have continued to support the work by supporting the social businesses that we have lent to.
Creating a sustainable investment fund is not easy and a huge part of the success has been the robustness of the investment panel that advises when to make and when not to make investments. This panel has been supported by a core of volunteers for 10 years now so we would like to give our thanks to Glenn Bowen, Alun Taylor, Charles Felgate and Simon Harris all of whom were there when the first loan was made and are still to this day lending their experience and knowledge generously.
As Chair of WCVA there is one other person that I would like to say a special thank you to and that is Walter Dickie. Walter has been Chair of the investment panel as well as a WCVA Board member. Since the beginning of this work bringing his vast experience from the banking industry and has played an instrumental role in guiding WCVA and the investment panel through the last 10 years. Walter has now expressed his desire to stand down as we enter a new phase and we will be greatly missed.
The Board of WCVA is excited about our role in managing the innovative nature of the new Social Business Growth Fund and pleased that it is evidence of the confidence based on our track record of investing social funds over the past 10 years. It will contribute to support more social businesses in Wales to create impact and opportunity in the places that need it most.
For further details on the fund contact mbrown@WCVA.org.uk