What does it take to build a purpose led inclusive economy?
Last week, our friends at Scottish Enterprise launched their radical new strategy for supporting Scottish businesses which places an emphasis on supporting the wider economy through inclusion, purpose, and fair work. I had the privilege to attend their Building Scotland’s Future Together event at the SEC where this vision was articulated to staff from across all of the country’s economic agencies, and we heard more about the new Mission Led Scottish National Investment Bank the government is launching next year. Alongside this strategy, we also got an updated enterprise ecosystem guide and a new Ambitious Entrepreneurship guide that paints a road map for ambitious businesses to scale up and grow.
It is an amazing shift for the country’s agencies and follows a move by the Scottish Government to focus on inclusive growth and begin to map the performance of the country against the national performance framework, which itself if is mapped to the UN’s Sustainable Development Goals. This monumental event prompted me to start to dig into that data we possess at Firstport and try to paint a map of what the scale of the pipeline looks like for this new economy.
Across all of Firstport’s programmes in 2018 we received 1735 formal enquiries for support from entrepreneurs wanting to use business to solve social and/or environmental issues. Of those enquires we were able to give some sort of support and/or advice in 1135 of the instances, which includes over-delivering by providing business supporting to over 250 people more than we’re contracted to. Our internal assessment shows that the split between those who ended up setting up social enterprises vs. other models of those supported is 69% to 31%. The 600 other enquiries did not progress primarily due to criteria of a programme relating to the age of idea and/or legal structure and not their quality. All of those numbers are only representative of those who made it into the system do not include the even higher numbers of people who phone up for a quick chat or get referred elsewhere.
When we published our new strategy earlier this year we noted that applications to some of our programmes were up in 2018 by as much as 20% of the 2017. Looking at the period between January and May 2019 those numbers are skyrocketing further, with applications to our earliest stage programme consistently up by 71% over the same period in 2018. And, that is before the very public shift in strategy by our friends at Scottish Enterprise. As a barometer of interest in starting a social enterprise or values-led business, those are amazing numbers and a clear sign that a shift is happening.
What does this mean for Firstport? Sadly, it makes all of our programmes much more competitive. At this scale, of interest we are still able to give the same quantity of support, but the increasing demand lowers the overall percentage of people who get support to as low as 20% in some areas, and puts pressure on the wrap around support that can be given to enterprises who aren’t quite ready yet (something we pride ourselves in being able to offer).
In addition, our strategy highlighted that we are seeing an increasing number of enterprises knocking on our door who set out on a social entrepreneurship journey but for reasons including geography, sector, or ambition are unable to use the social enterprise model. By our estimates, there were around 900 of those who tried to came to Firstport last year who ended up falling off the map with us unable to see clearly if they got support elsewhere. This in part is why we set up a sister company FirstImpact that is in the process of opening its doors.
This move towards a purpose led economy working towards inclusive growth and mapped to the Sustainable Deployment Goals where social enterprises and social purpose businesses are normalised is an amazing place to be, and in my opinion, takes our whole country to a new place. The dilemma we now face is how we shift the support ecosystem to help facilitate that. There is a risk that we create a demand for a model without equipping the people to support and understand what is different about it, and a risk that we just change the language without changing our ways of working.
We are building a new economy, and that economy will be purposeful, with communities and the environment at the heart of the decisions we make. What do you think this road map should look like and will you help us build it?
