Canadian Social Enterprise guru, David LePage is in Australia, helping the local sector build capacity to take advantage of the huge amount of capital looking for a productive outlet in hard times.
Commenting on the low-interest environment and generally unpredictable economic output he noted that “The problem for social entrepreneurs is not finding investment, it is finding the ‘right’ investment.” He was addressing government, industry and academic professionals as well as social entrepreneurs at a breakfast sponsored by the Brisbane Exhibition and Convention Centre. He said the challenge is that professional funds are not always ‘patient investors’ nor do they understand the value of ‘social capital’.
On a panel with David Brookes of Social Traders, Emma Kate Rose of Food Connect and Belinda Morrisey of English Family Foundation and hosted by Impact Boom’s Tom Allen, LePage said that despite the many challenges facing social entrepreneurs, the sector is maturing rapidly. “Five years ago we were discussing what social enterprise is, now we are discussing how we can best interface with government and the investment community.”
The shift from social welfare to social trading is partly a response to changes in government support from block funding to transactional funding, characterised by initiatives such as the NDIS. The Federal government has also responded by developing new models of investing such as crowd funding of equity and the nascent Impact Investment Working Group.
The move away from grants and ‘hand outs’ toward an entrepreneurial approach has also been fuelled by a desire for self-determination and creative freedom. This is complemented by the maturing of Corporate Social Responsibility (CSR) and the recognition that the loss of social license by scandals such as those revealed in the recent banking royal commission. In some cases, corporations are reaching out to connect with stakeholders and customers through good works, resulting in conferences branded “Good is the new cool”.
Questions from the floor emphasised a significant gap between these intentions being formed at the big end of town and the experience of the entrepreneur trying to solve social problems through commercial activity. A lack of affordable real-estate and angel investment are clear barriers for companies starting out. LePage identified real-estate as a possible alternative to impact-investing for ‘patient investors’ who are not ready to engage directly in the social enterprise sector.
The breakfast followed a Social Traders conference in Melbourne last week, and a weekend long conference organised by Queensland Social Entrepreneurs Council held on the Sunshine Coast.