Kathryn Uche explains how, with the right resources in place, CAYSH was able to successfully transition to a social enterprise model.
Established in 1981, CAYSH is a charity delivering accommodation, advice and support services for young people facing homelessness across every South London borough.
In 2010, we undertook a strategic review of our structure and activities. We’d just expanded into a new borough, and with this growth came the need to develop a more sustainable funding mix. The landscape for charitable organisations was changing, with government spending cuts and the rising needs of service users piling pressure on our existing services, and we wanted not only to keep up but to thrive in this new environment.
Finding a niche
We’d identified that there was a gap in the market for an affordable, out-of-hours concierge/security service within the supported housing sector - and, based on our experience of working with private sector agencies, we believed that we could do better. We had the experience and the skillset to initially provide security services to those tenants within our own supported housing provision, and we were encouraged by commissioners and property landlords to do so.
Our idea was to set up a trading arm – a community interest company called CAYSH Enterprise, with CAYSH Concierge Services being our first venture. The aim was to provide high-quality, value for money security services in supported housing that would protect the interests of vulnerable people while delivering reduced costs and reduced incidents for commissioners and the local community. With guidance from SEUK, the national body for social enterprise, we took the step to transition the CAYSH concierge service into a social enterprise model.
Why social enterprise?
Social enterprise is an increasingly popular business model in the UK, with around 70,000 operating currently, making up 5 per cent of all UK businesses, employing over 1m people and contributing around £20bn to the economy. Social enterprises are businesses driven by a social purpose, and which earn more than half their income through trading, reinvesting or giving away at least half of profits towards their social purpose.
As the need for charities to become more business-orientated increases, a growing number are looking at the social enterprise model. The Big Issue is probably the best-known example, but there are many smaller, different types of social enterprise operating effectively throughout the country.
Charities can either set up a trading arm to sit alongside the charity, or change the whole organisation into a social enterprise. We decided to set up a trading arm to begin with, for a number of reasons; including the fact that cultural change within organisations can take time, and we needed to be responsive to the demands and opportunities that were there at the time. We also wanted to test the water with a enterprise which could stand alone but which could also potentially expand into new areas.
Not a silver bullet
We knew it wouldn’t be an easy ride. In delivering their advice and guidance, SEUK were careful to point out to us that it wouldn’t be a panacea for all funding challenges, and that it would be a slow process to get up and running at full speed. There would be many hurdles to overcome - not least among these, fear of the unknown. We had to get buy-in from all our stakeholders. The local authorities we worked with were very supportive, but we also had to persuade the board of trustees that developing a social enterprise approach was the right direction for the charity.
We therefore had to put together a water-tight business plan, clearly showing the market need, that the finances added up, and that we have the right people in place. This took a great deal of time and resource. We invested in a feasibility research study which helped build the business case; we worked with SEUK to put together our business plan; and we recruited new trustees to the board who have social enterprise experience and commercial backgrounds. We invested in our infrastructure too, getting some key personnel in post and embarking on an intensive training programme for the concierge workers, among other things.
A key challenge was to ensure we stayed strategic while being operational. This has been tough at times, as operations can be demanding, and often need to be prioritised. But unless the leadership remains strategic and continues to build the vision, the business prospects and potential can be limited. Balancing the needs of the social enterprise and the charity can be tricky too - but also exciting, and the one things that keeps us all focused is the collective vision of improving the lives of the homeless young people we work with.
Adding it all up
Getting the finances right was another hurdle. The recruitment of a business development manager who loves his figures and his spreadsheets was certainly a turning point for the social enterprise! We have all learnt to understand the importance of a profitable bottom line, and while the challenges keep coming (with further service cutbacks threatened, increased private sector competition and needing to scaling up the business while maintaining quality standards to name a few), we are not deterred from giving it our all.
As anticipated, it has not been an easy journey, but thanks to our realistic attitude and systematic, persistent approach, we’re pleased to report we are now a thriving social enterprise. We began the service in 2010 with an income of £85k, and in its first year of trading (Nov 2013-Oct 2014) the community interest company has an estimated income of £1.5m. We’ve gone from seven staff to more than 50, and we have over 400 residents who have access to the CAYSH Concierge Service.
Growth of the organisation can be seen across many aspects: financial, personnel, customers, location, systems, our business strategy/vision, our reputation and our confidence. We’ve successfully launched a culture of enterprise that brings with it new opportunities - including a brand new office, which we moved into in May
Making it work for you
For anyone thinking about social enterprise, there are several pieces of key advice I’d impart. Firstly: Get help! There are numerous resources out there to help you determine whether or not the social enterprise model will work for you (some are better suited to the model than others). To get started, SEUK should be your first port of call.
Second: build your team. Make sure you’ve got the right people in place, from trainee to trustee, and make sure communication is open, transparent and inclusive of all stakeholders at all stages.
Finally: Stay focused and persevere. As Thomas Edison said: “Many of life’s failures are experienced by people who did not realise how close they were to success when they gave up.” So don’t be put off if you make a few mistakes along the way; learn from them, and don’t give up!
Kathryn Uche is chief executive of CAYSH