Social investment activity and awareness have grown significantly over the last several years. While we're still sometime away from having social finance be considered 'mainstream,' there is no denying that it's an exciting time for those wishing to marry financial and social return. Among those working tirelessly towards unlocking social finance's full potential is Nigel Kershaw OBE.
Nigel is a veteran and pioneer of social enterprise and social finance; in fact, he was working in these spaces well before they even had names. He is the Chairman of The Big Issue, a social enterprise founded in 1991 enabling homeless individuals in the UK to earn a living, and the CEO of Big Issue Invest, a social investment business founded in 2005 that provides finance to social enterprises. The Big Issue is currently considered among the UK's most trusted social brands.
Following on from my interview with Andrea Coleman, CEO of Riders for Health, I sat down with Nigel for this second entry in our Social Impact Insights blog.
What is the one thing you wish someone had told you before starting out Big Issue Invest?
Nigel: If we'd known it would take 8 years to start we probably never would have started. We were in fact warned about this at the time, but our belief in the mission and our naivety led us to feel that we could achieve our ambitions at the speed we wished.
What we would have liked is for more people to tell us to follow our mission without letting others tell us what cannot be done. We were aiming to create a social merchant bank - something unheard of - and as such, we had an ocean of untouched blue water. As a result others were as inexperienced as we were with this new opportunity, which is why the best and I suppose the only advice we would have benefited from was the importance of persevering with our mission.
How do you think the environment has changed for social entrepreneurs since Big Issue started?
Back in the early 90's no one knew much at all about social enterprise. Since, there has been a significant increase in recognition about what a social enterprise is, which I feel The Big Issue was able to play a significant role in. Our brand presence and trusted social enterprise model was something that provided strong credibility and a clear understanding of the social enterprise sector.
Initially though, there was a clear lack of understanding of social enterprise business models. For instance, not many people at the time and even now realise that we sell The Big Issue magazines to thousands of vendors for £1.25 and they sell it on for £2.50 - we consider all our vendors to be micro entrepreneurs.
Furthermore, something that has not changed is the continual battle between recognition that we are not a charity but actually a business - even though we reinvest our profits back into our social mission. Once again this links back to the consumers understanding the business model. The main reason this is that 'creating profit that creates social value' can counter intuitive.
Most people with a charity mindset feel that they shouldn't be 'creating profit,' which is fair for some charities. However in order for social enterprise to effectively create social value they need to make a surplus. In our perspective the greater our profit the more social value our homeless and vulnerably housed micro entrepreneurs can benefit from.
What are the biggest opportunities out there right now for social entrepreneurs?
'We had everything before us, we had nothing before us'. This quote from Charles Dickens helps answer this perfectly for me. In a strange paradox the greatest opportunities for social entrepreneurs are at times when people are in most need. With 'nothing before us' social entrepreneurs have the optimum platform to create things going forward in order to help others break out of adversity.
What has been your most valuable failure?
I believe that there's no such thing as failure. I personally consider what others see as failure to be a building block of learning that I can benefit from going forward. So, not believing in failure is not something that should suggest I am arrogant; on the contrary I feel this way due to my belief that there is always room for growth for an entrepreneur. In my opinion any experience that provides progression and growth should not be considered a failure. The question to myself is how quick can I learn from my mistakes rather than regard them as failures.
What has been your biggest mistake?
If I were to be incredibly honest to myself it would be that I trusted the wrong people. I found out too late that certain individuals were not aligned in the same way as I was to our mission and in refection I was clearly too 'romantic' about people's motives. For anyone in a similar position would say: use people to help you that are not aligned to your mission, but only trust people that are aligned to your mission.
What are the three lessons you would pass on to any budding social entrepreneur?
So these lessons may sound like a contradiction but it is an intentional contradiction because social enterprise itself is a model built and flourishing from contradiction:
1) Follow the mission not the money.
2) Embrace profit that delivers social value.
3) If you're driven by your mission make sure you have the right people to deliver the mission and always push them. If there are individuals that are inhibiting your progress due to their lack of belief in your mission do not let that put you off. Ultimately, make sure you trust in your mission, your people and yourself.
You can learn more about Nigel Kershaw, The Big Issue and Big Issue Invest here.