'Lack of finance and understanding prevent growth of social enterprise'

Social Enterprise Coalition report says attempts to replicate successful ventures face a range of obstacles

Peter Holbrook, chief executive of the Social Enterprise Coalition
Peter Holbrook, chief executive of the Social Enterprise Coalition

A lack of finance, support and information is preventing social enterprises from expanding, according to a report published yesterday by the Social Enterprise Coalition.

The report, Growing Social Enterprise: Research into Social Replication, looked at 22 social enterprises that had tried to replicate their businesses through franchising, licensing and collaboration, but found that investors and grant funders often did not want to support their models.

The report says social franchises often lose out on funding because funders do not understand the franchising model or feel it is too commercialised, and are reluctant to commit cash to support it.

It also says organisations in the sector lack understanding of the issues, particularly intellectual property, and the capacity to grow.

Peter Holbrook, chief executive of the Social Enterprise Coalition, said: "Individually, and as a collective, we need to work hard to change the mindset of funders and financial institutions, many of whom do not see replication as an option for social enterprises.

"Organisations should not be operating in fear that choosing to franchise would lead to a reduction in grant money, and funders need to know that behaving like a business is not a negative."

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