A lot of projects rely on a complicated mix of grant and loan funding, and putting that package together can be full-time job. Todd Hannula, director of social enterprise of the Camberwell Project, has recently finished securing a £4.5m funding package to transform the former Harehills Middle School in Leeds into an 'enterprise centre'. This is a complicated jigsaw of statutory grant and loan funding that has taken nearly two years to achieve and has weathered numerous setbacks.
Hannula's experiences are a warning to other organisations that are planning similarly complex funding packages. He refers to his experience of securing the £700,000 that came from the European Regional Development Fund.
"We had to put together an overly complicated business plan, and the European Regional Development Fund spent a huge amount of money processing it, when we could have gone through a very simple process of checks and balances," he says.
In fact, the project was rejected three times by the ERDF before it even got through to the pre-approval process. The problem was a mixture of complicated criteria and long-winded processes combined with difficulty in sourcing matched funding. But the project secured £1.45m from the Leeds Local Enterprise Growth Initiative's Sharing the Success programme without any major setbacks. "That was smoother - you show your business plan, go in front of a board and there's your money," explains Hannula.
Although Hannula dealt with only a small number of funders from the statutory sector, he believes the Camberwell Project's experience of putting together a funding package is not unique and advises other voluntary organisations to be determined.
"Don't simply go for grants to cover everything," he says. "Start by working out how much the business will eventually be able to pay, and work out how much debt you will be able to service. That lets you know how much loan you can go for, and then you can think of the grant as the same amount."
Despite urging others to stick to their guns, Hannula remains sceptical. "I can borrow a few million more easily than I can get a grant," he says. "It's amazing anyone ever gets any funding at all."