In the current harsh economic climate, in which many charities struggle to stay afloat, setting up a new one might at best be considered brave and at worst foolhardy.
Yet every year thousands of new charities are added to the register. In 2017, the Charity Commission for England and Wales registered 5,398 new charities, a 16 per cent increase on the figure from four years ago.
The newcomers are varied. Some are small and energetic, beginning as one-person bands responding to unmet local needs. Like tech start-ups, they hit a rich seam of demand, quickly outgrow their backyard or front-room origins, then scramble to establish a more sustainable footing. That means scaling up, taking on paid staff and moving into their own premises.
Others develop out of an existing charity, most likely driven by the parent charity’s need to plug an income gap. They generally act like social enterprises, trying to maximise income while retaining the ethos and culture of the parent charity. Others emerge almost by chance. One was born from a hashtag circulated between friends that went viral. Light and nimble, such organisations can respond quickly and satisfy supporters’ desire for low overheads.
All these varied models are visible in the following profiles of five of the most entrepreneurial and energetic charities to have been founded in recent years. All share two traits: to fulfil an unmet need and succeed against the odds.
When news coverage of the refugee crisis in Europe was at its height in 2015, a group of friends began organising humanitarian help on social media. With the hashtag #HelpCalais, their plan was to harness the concern of ordinary people shocked by the suffering outlined in the headlines.
It went viral, says Tom Steadman, now head of communications. "A number of celebrities shared it, and within the first week we’d raised £56,000." They set up a warehouse to store donated items, which were coming at the rate of 7,000 a day, he says. And when they made a call-out for volunteers, people responded.
A group took the donations to Calais. They opened a warehouse with an established French organisation, L’Auberge des Migrants, and worked with it, giving out shelters and tents, distributing hygiene packs, food and other essentials. Though some volunteers had specific skill sets, none were experienced aid workers, says Steadman: "We just worked out systems really quickly.
"Constant learning and feedback helped us to improve. Within a year we’d set up a full-scale operation and were distributing everything people needed."
Help Refugees responded in a similar way to the shortage of doctors available to help migrants in Greece. A call-out on social media managed to find 20 or more UK doctors willing to go out.
After two-and-a-half years, the work had expanded to support more than 722,500 people across 75 projects in 12 countries up to December 2017. Crowdfunding was responsible for about 61 per cent of the £10m income it received from October 2015 to December 2017. Other money has come from raffling a sculpture by the graffiti artist Banksy.
This Christmas, Help Refugees ran pop-up shops in London and New York. Visitors to Choose Love got a chance to see and interact with items that are vital to a refugee, from survival blankets to educational materials. Purchases were not taken away with the shopper but sent to be used by refugees. In 2017, the London store raised £750,000.
The charity’s website makes it clear that it sees itself as meeting "the genuine needs of refugees", filling gaps left by big NGOs and governments. Steadman stresses that the key is to be unconstrained by red tape and to link up quickly with smaller grass-roots organisations that are already active and responding to need.
Real Junk Food Project Sheffield
The assumption that many people jump to is that the Real Junk Food Sheffield project is about feeding the homeless or relieving food poverty, says founder and chief executive Jo Hercberg.
"We’re not a poverty project, but even the Jobcentre is referring people to us," she says.
For her, the three-year-old social enterprise is mainly an environmental organisation: "We want to stamp out food waste. Our point is that we could feed the hungry and there would still be tonnes of waste."
The Sheffield project is a member of a grass-roots network of independently run real junk food projects around the country. Its charitable status derives from its membership of the network. Although a social enterprise, it operates as a private company limited by guarantee.
The social benefits, which are significant, are a spin-off. As well as two pay-as-you-feel cafés and the market, an education programme set up by co-director René Meijer provides five local primary schools with weekly deliveries of food and an educational package of workshops and assemblies. The schools decide themselves what to do with the food.
As a primary measure of success, Hercberg points to saving more than six tonnes of waste food a week. "But we’re only dealing with 1 per cent of the food wasted in Sheffield," she says. "So it’s not enough."
Doing more means expansion. So in November 2018 the project began crowdfunding to raise £50,000 for a more stable warehouse base equipped with larger cold stores and a kitchen.
This is not the first time scaling up has required investment. Not long after the 2015 launch, Hercberg’s home, and the venues for the popular pop-up cafés she was running, were overflowing with donated surplus food. "It was ridiculous," she says.
The solution then was Key Fund, a social investment provider, which agreed a £40,000 blended finance package, a mix of grants and loan, at the end of 2016. That moved the project from a one-person-does-everything voluntary start-up to a more professional business. There are now eight staff, five full-time, and 180 volunteers.
Hercberg says the organisation, which plans to get its own charitable status later this year, operates in part as a bridge, linking commercial supply with charitable demand. Supermarkets want to be seen to be donating their surplus food to good causes, but charities don’t have the logistical set up and know-how to use it.
By hiring vans, leasing storage and working every day with many different supermarkets, the project can even out the randomness of supply. That’s why social enterprise is a better model than a straight charity, says Hercberg. Her advice to others is to talk to lots of people about the idea, even if it’s just family and friends.
"Get a mentor if you can. I didn’t do that at the start and, looking back, that would have really helped."
The Bike Project
Sales revenue of more than £93,000 a year is a healthy income stream for a grass-roots community project that began when Jem Stein, then a student at the London School of Economics, fixed up his brother’s unwanted bike. The bike was given to Adam, a Darfuri refugee Stein was mentoring.
Realising what a difference it made in terms of wellbeing, exercise and affordable transport, Stein continued fixing bikes in his parents’ shed and offering them to refugees. The Bike Project now employs the equivalent of eight full-time staff. Each week it presents between 25 and 30 refugees with professionally refurbished bikes, helmets, lights, high-vis vests and locks. The sales business, which began as a natural spin-off in 2015, making best use of higher-end donated bikes, has made the project arguably the biggest retailer of second-hand bikes in the country.
Most of the charity’s income of £578,000 comes from grants and donations. But at about 16 per cent, the sales income for 2017 is significant and more than double that of the previous year. It is also a major awareness raiser, giving people who want only to buy bikes an insight into the circumstances of refugees. The use of tens of thousands of dollars in Google adwords credits is a powerful driver for this, bringing 40,000 unique users to the site each month. There, tempting offers of refurbished bikes sit alongside brief descriptions of the value of the help given to vulnerable migrants
All this reassures potential funders that the charity is entrepreneurial and constantly developing. "You can’t coast," says marketing and PR officer Anna Chapman. "Funders simply lose interest if you’re not innovating."
New projects include Pedal Power, a women-only eight-week course run by women. "It’s incredible seeing people grow in confidence," says Chapman. Another is Bike Buddies, which links refugee cyclists with volunteers in the same localities to share rides, routes and knowledge about local services.
In retail, the project is expanding its accessories and merchandising. Being unable to compete on price with mainstream retailers is not a concern for Chapman. "You’ve got to assume that people are not just motivated by price," she says. Given that inexpensive new bikes are widely available, the offer has to emphasise the stock: good bikes expertly refurbished and guaranteed.
Merchandise includes wallets and phone cases made from recycled inner tubes. There’s an overlap between people who cycle and those concerned for the environment, who have a desire to help vulnerable people, which the sales pitch focuses on. A charity impact tag attached to a Cannondale Bad Boy Fatty Disc Hybrid Bike says "buying this bike will allow us to give five refugees a bike".
Stein advises other entrepreneurs to avoid too many diverse income streams. This might be counter-intuitive for non-business minds. He explained in a School for Social Entrepreneurs interview that it’s difficult to be good at lots of different things and much easier to be very good at one thing. Identifying one income stream and focusing all your resources on making it work makes more sense than spreading over multiple possibilities. If it doesn’t work out, try something else.
Its plans to offer corporate servicing – where teams of mechanics spend the day at a company servicing the employees’ bikes – are currently on hold. The project found it hard to compete with commercial companies. But there are plans to move outside London, opening up hubs in Birmingham initially. And there’s a constant desire to increase stock levels, sell more bikes and provide more for refugees.
Lee Wakeham enjoys watching his team of Cornish-style pasty makers react to satisfied customers.
"The look on their faces is incredible," he says. "They’ve made the pastry and the filling, and filled the pasty. They’ve crimped the pasty, they’ve glazed it, they’ve bagged it, they’ve labelled it. And someone’s just come back and said ‘that’s the best pasty I’ve ever had’. In time it gets them thinking more positively about themselves."
This is significant: all the staff are ex-offenders, many recently released from custody and working for H.M.Pasties in a rehabilitation programme leading to future employment in the food industry. It is an initiative of Groundwork MSSTT (Manchester, Salford, Stockport, Tameside and Trafford), the charity that employs Wakeham as an employment coach and approved his plan to set up the social enterprise.
Launched in December 2017, H.M.Pasties supplies high-quality, traditional hand-made pasties, wholesale and retail, in Manchester and north-west England. With regular stalls at makers markets, a contract with FC United, deliveries to construction sites and other contracts, the customer base is building. Ingredients are sourced from prison farms. People with convictions are employed in manufacture, sales and distribution, and receive peer mentoring support from the permanent staff they work alongside.
A year in, it is going well, says Wakeham, himself an ex-offender who knows the challenges of building a new career after a sentence. Typical revenue from a market stall is between £350 and £500 a day. His short-term aim is to generate £1,200 a day: "We should hit that target by the end of this
He estimates that this would bring an annual income of £312,000. This would cover existing salaries as well as the costs of vehicles, insurance, ingredients, shop lease and street trading licences.
The pasties sell for about £4. "We’re not competing with Greggs," says Wakeham. They appeal to those who appreciate quality food and who want to support the social enterprise. Former prisoners are arguably not among the most popular of beneficiaries, but Wakeham finds public responses are positive. When the Manchester Evening News featured the business, only two of well over 100 comments were negative, says Wakeham.
It is, like any business start-up, hard work. "I’ve never worked so hard in my life," says Wakeham. "I’ve been making pasties until 1.30 in the morning and then been back in the kitchen at 5am baking them. But I wouldn’t want to do anything other than this now."
Katrin McMillan knows her project is a bit different when she hears it described as "wacky" or "out there" during conversations with prospective funders. "They say it’s not going to work or that it’s going to get stolen," she says. "I’ve been told it will be used for Jihadist beheadings, or to watch pornography, or all they’ll do is play games. People have been wrong, it turns out."
Hello World, McMillan’s current project, focuses on a crate of equipment that, once assembled, will become an educational hub for a community. Solar powered or, if preferred, pedal powered, the computer at its centre is loaded with educational games and software. It connects to the internet, has built-in video and still cameras, and a charging station. Benches are there for seating, and a roof provides shelter. This is vital because the hubs will be situated out of doors.
This month, four crates containing Hello Hubs will arrive in Nepal. Communities will be supported to build them. The first one was piloted in October 2014 in Suleja, Nigeria. Three more were built in 2015 by different communities across Uganda.
McMillan, chief executive of Projects for All, a small UK charity that runs a variety of start-up projects, is frustrated by the practices of conventional development NGOs.
"You can’t be closeted away in a head office in Lagos and purporting to be getting the internet out to rural locations when you don’t know those people and are not working in a true partnership," she says.
More fundamentally, McMillan’s critique is of the model itself. She notes that although there is widespread acceptance that education is a human right, agencies push ahead with a paradigm that cannot properly address the lack of it. The education deficit is so vast that the preferred model of providing schools and teachers cannot deal with the scale of the problem.
There are, she says, 69 million too few teachers worldwide and 121 million children not in school. McMillan’s solution was inspired and shaped by work by Sugata Mitra, who described his "schools in the cloud" experiments in India in a 2013 Ted talk. The aim is to enable virtual schools where children and adults take the lead in the design of a shared online resource, community-owned and operated.
As a tiny charity, her project has grand aims. It is designed to scale up. Small pockets of innovation round the edges won’t make much difference, says McMillan: "We approached funders and asked for a year to prove this. If we don’t get to a certain scale by September 2019 it’s probably game over."
Sufficient funders, including the venture philanthropist Stephen Dawson of the Impetus Trust, said yes. The goal is to be under way with a 50-hub build by September 2019.
"It is a massive scale-up, but it’s only at scale that we can genuinely see what’s possible. If we tinker along staying small, there’s no point."