Scottish Transition Gathering 19th November 2010 Tom Black

y What is community enterprise? y Why bother? y Some examples y Exercise 1 y y y y

is it for us? Common success factors Common pitfalls Exercise 2 - SWOT Sources of further support & finance

What is community enterprise?
y Trading for community benefit y Fusion y y y y

meeting social mission AND earning income Not for private profit, but FOR PROFIT Carried out by community-led organisations Self-help ethos - communities themselves are the best agents of their own renewal Creating wealth in communities, and keeping it there.

Why bother?
y Surpluses can be re-invested in further community initiatives y Supports the organisation over the long-term by reducing risk to core operations and building reserves

Free working capital no strings attached Effort goes into creation of long-term revenue streams not grants that need to be applied for again and again The cuts! In short, moves us towards financial self-sufficiency necessary for sustained change

Why bother?
‡ Local empowement and pride builds a healthy, confident, can do culture ‡ Builds profile, credibility and support - with funders, partners and your community Increased community involvement e.g. volunteers A springboard for further ideas and activities wider community renewal! Attract further investment Increased skills and abilities of community In short, builds capacity and changes attitudes

Sector size
y 500 development trusts in DTA UK membership Scotland

150 in

y Working in communities that make up a quarter of UK popn. y Collectively own £0.5bn in assets y Total income over £250m, earned income over £100m y Employ 4,500 staff y Over 17,000 volunteers

Exercise 1 is it for us?
In groups of 3 or 4 discuss: y Does it square with your organisation s mission and ethos? y What enterprise opportunities exists in your community? y What is the social need (mission) y What is the financial opportunity (market)

Common success factors
y A clear value--led mission and set of priorities developed by the community y Clear legal model and governance structure y Strong leadership y Constantly developed in--house capacity y Understood the importance of transitions y Strong working relationships with local agencies y knew how to actively engage with their community consensus building

business skills

Common success factors
y Have an investment strategy, and know this may

conflict with profit maximisation. NB diversity of projects y Ownership of an important asset y Learn from good practice y Plan ahead y Don t wait for the right time

Common pitfalls
y Feasibility bias y Wrong asset y Wrong skills y Lack of leadership y Didn t get balance right between mission and market y Grew too fast too soon y Unclear purpose y Didn t build local support

Legal structures
Use most appropriate structure y Company Limited by Guarantee y Company Limited by Shares y Charitable status y Community Interest Company y Industrial and Provident Society
y Bona fide y Community benefit society

y Limited Liability Partnership

Exercise 2 - SWOT
Choose an enterprise idea. In pairs, discuss: y What strengths does your organisation hold in relation to this? y What are the weaknesses in your organisation? (how ready are you?) y What are the opportunities? y What are the threats?

Do you: y Understand what community enterprise is? y Feel there are benefits to this approach for your community or cause? y Understand the pitfalls and success factors? y Have a community enterprise idea that you want to take forward in your community? y Know of examples you can visits / research?

Some sources of finance
y y y y y

Big Lottery Fund Climate Challenge Fund (?) Esme Fairbairn Foundation CARES replacement scheme Loans e.g.
y Social Investment Scotland y Triodos Bank y The Co-operative Bank

y Community share or bond issue y Other investors, e.g. Empower Community

Sources of further support
y Development Trusts Association Scotland y First Port y SENScot y Social Enterprise Academy y Local People Leading y Social Firms Scotland y Community Energy Scotland y Community Recycling Network Scotland y Community Retail Network y Community Woodlands Association y Community Transport Association y Scottish League of Credit Unions y Scottish Association of Farmers Markets