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Big Issue Invest and Socia


Most readers will be familiar with The Big Issue, particularly the vendors of its magazines. Many assume that The Big Issue is a charity - it is not. It is a social enterprise and takes an avowedly commercial approach to doing good.


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igel Kershaw, Chief Executive of Big Issue Invest and Group Chairman of The Big Issue Company, spoke recently at Reptile Rendezvous, a regular Chameleon PR agency social and networking event for


management, public relations (PR) and technology marketing executives held in central London. He described its origins, business model and the many ways it has pioneered social entrepreneurship as a business strategy to create social change.


The scale of The Big Issue sometimes escapes people. Last year the social enterprise enabled over 2,000 homeless and vulnerably housed Big Issue vendors to sell 86,000 copies a week, which were read by over 480,000 people in the UK and last year alone earned over £3 million, offering homeless people the opportunity to reap an income as an alternative to begging. As a result, The Big Issue has inspired 100 similar publications to be set up in 40 countries around the world.


Another interesting initiative recently launched is the investment arm of The Big Issue - Big Issue Invest (BII). This is being led by social entrepreneurs and experienced social financiers, with first-hand experience of building and running social businesses in both good and difficult times. The BII board and partners bring together a wealth of experience, innovation and success that adds strength and depth to the support it offers and the relationships it builds.


Dismantling poverty by investing in business The Big Issue’s mission is to ‘dismantle poverty and inequality by investing in business solutions to social and environmental challenges.’ As Kershaw, says, “we aim to help people to help themselves by backing business-like responses to social problems with self-help and prevention at their core.”


There are now an estimated 55,000 social enterprises across the UK, but back in 1991, when Body Shop co- founder Gordon Roddick saw homeless people in New York selling Street News and asked John Bird to found The


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Big Issue in London, it was one of the earliest pioneers of the social enterprise model. A decade on, co-founder and editor-in-chief John Bird and Nigel Kershaw (then the Big Issue’s Executive Chairman), found themselves asking why there weren’t more social enterprises like the Big Issue and Café Direct (the fair-trade coffee pioneers). They explored ways to grow the sector and so BII was born.


Loans and investments, not grants BII investment strategy is to help scale up social enterprises and charities throughout the UK by providing loans and investments, not grants, from £50,000 to £1 million in the form of loans, participation loans (where repayment is linked to the future performance of the enterprise) and equity. It can also work with partner social investors to provide finance above £1 million. Finance provided by BII may be used for working capital, property purchase or renovation, equipment and other capital expenditure or growth or acquisition. As a social enterprise itself, BII pays any dividends generated up to its parent, The Big Issue with a charitable arm, The Big Issue Foundation. To be eligible for investment entrepreneurs need to be serving a disadvantaged population with a focus on at least one of jobs, education, employment and training, health and social care, social and financial inclusion or community development.


Just as in any business looking for investment, prospective social entrepreneurs need to be able to demonstrate a clear social mission with significant measurable, direct outcomes, strong management with proven capability to deliver and good corporate governance. Track record is important too; the ventures need to have been operating for at least 24 months (newer businesses are considered on a case-by- case basis) with a history of positive cash generation from trading or a clear near-term path to surplus cash generation.


Of course, a robust business plan and financial projections need to be delivered for operations based in the UK, although social enterprises with head office in the UK but operations overseas are considered on a case-by-case basis. All investments too must demonstrate their ability to


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