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Time for funders to increase support for charity enterprise, report says

Melanie May | 29 June 2023 | News

£5 & £20 notes. Photo by Christopher Bill on Unsplash

In a challenging environment, enterprise is playing an increasingly important role in providing income for charities with now the time for funders to up their support in this area, a new report says.

The Enterprise Grants Taskforce was set up in August 2022 to bring together funders supporting charities and social enterprises to carry out more trading activity. It appointed a research team led by Social Spider CIC last September to conduct an evidence-based research report on enterprise grantmaking, and specifically to refine the definition of enterprise grants, and to scope and size the field.

The authors of the report, Social Spider CIC define enterprise grant-making as:

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“An approach which encourages and supports charities and social enterprises to increase or maintain their income from enterprise activities, including selling services or goods. This is largely through using funding conditions and/or incentives to encourage enterprise behaviour, often accompanied by capacity building.”

At the moment, the report says, the number of enterprise grants available do not meet demand. Only £2.6mn of grants a year through three funds are clearly identified as meeting the definition of enterprise grants, through SSE’s Match Trading, Access’s EDP and Unltd’s Grow It fund.

However, it identifies a much greater amount of funding (between £22mn and £115mn per annum) supporting enterprising activity in a wider sense, and says that an increasing number of funders are looking to move towards enterprise grant-making as part of their offering. 

The report says that over 25,000 social enterprises could be interested in enterprise grants as they identify access to grant funding as a key barrier to their sustainability and growth. 

As such, the Enterprise Grants Taskforce believes now is the time for more funders to look at adapting their practises to become more enterprise-centric to support the sector.

Commenting, Alastair Wilson, CEO of School for Social Entrepreneurs, said:

“One thing’s for sure, the current sources of funding were not designed by practitioners on the ground. In 2023, is it not time we radically overhauled how grants are administered to reach broken markets whilst embracing the creative, entrepreneurial energy of local communities to create change?

 

“Social Spider’s report shows early signs a new wave of grant-making that enables social organisations to become more sustainable and generate local impact. Funders interested in sustainability may wish to consider how they can incorporate enterprise grant-making into their funding mix.”

Anna De Pulford, Chair of the Enterprise Grants Taskforce and Director of Dulverton Trust, added:

“Voluntary sector organisations are increasingly having to compete for donations. In this environment, enterprise can play an even more important role. Funders are rightly being called to provide flexible, unrestricted funding – but we also need to recognise that developing enterprise requires specific skills and resources. This report is a timely reminder that we funders could be doing much more to support the development of charities’ enterprise and I hope to see other funders joining this necessary and growing movement.”

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