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Holly Piper

Head of CAF Venturesome

Charities Aid Foundation


SUMMER MUSINGS ON VENTURE PHILANTHROPY

11 September 2017

Back in the heady days of actual summer (when the weather was playing ball), Big Society Capital et al hosted an event on venture philanthropy – exploring who is doing this and what more is needed. This was building on another workshop held in unexpected February sunshine (can you tell I’m having summer withdrawal symptoms?), at the Gathering conference earlier this year. So was this second workshop a jargon-rich self-indulgent shindig, or a decent attempt to explore how we can collectively and individually better support social organisations to grow their impact? (spoiler alert: it’s the latter).

Firstly, as a bit of an aside, the air-time venture philanthropy is currently getting is really interesting for Venturesome – we are an established social investor supporting a huge range of charities and social enterprises, yet we rarely describe ourselves as a “venture philanthropy organisation”.

However, it’s pretty clear that we are indeed providing “venture philanthropy” to our investees – i.e. non-financial high-engagement support (for fuller definitions of ventures philanthropy, see European Venture Philanthropy Association).  As part of the due diligence before making a social investment, we challenge business models, work through scenarios with senior management, suggest (and sometimes require) governance improvements, and much more. And whilst we know that (most of the time!) this due diligence turns out to be very useful for the charities and social enterprises we support, we have tended to downplay it. 

Once the social investment is in place, most of our investees say how helpful this process was, but we know that due diligence does not always feel “helpful” whilst you’re going through the receiving end. This means we’ve deliberately been downplaying how much venture philanthropy we do – probably not, in hindsight, particularly helpful – least of all for charities and social enterprises looking for support!  In future, we shall be clearer that good due diligence and good support are (usually) one and the same. 

So back to the venture philanthropy workshop…. the most insightful contributions were from venture philanthropy recipients Ben Allen at Oomph and Kathy Thomas of Rochdale Connections Trust – they both gave clear accounts of what support had been helpful, and what had been disempowering, annoying or a waste of time – reminding us of the importance of aligning interests between investee and support provider. 

One of the conclusions of the workshop was the strong need to test and measure what elements of support work best, and when. It is obvious that different organisations and social entrepreneurs will need different support – but there is not a clear consensus on what non-financial support is most effective (and cost-effective). Is it individual coaching for the CEO? Impact measurement workshops? A funder joining the board? Away days in glamorous places?

The lack of clear best practice in the UK is potentially worrying – it is beholden on all funders to use their resources well, not least in the current political climate as funding for social organisations gets tougher. Call it venture philanthropy, call it non-financial support – it can be expensive to provide, and all funders should be ruthless at understanding how much it costs them to provide this, learning best practice from others (such as Germany’s Ananda Social Venture Fund), and ensuring that their resources are deployed as effectively as possible. To develop and share best practice, BSC, EVPA and others are leading a steering group – a very constructive outcome from the workshop.

WANT TO KNOW MORE?

Talk to our team on 03000 123 300 or email us at venturesome@cafonline.org and we’ll be happy to help.

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