Recently, a new organization here in Edmonton caught my eye: the Social Enterprise Fund (SEF). Today I met with Omar Yaqub, the organization’s Director of Operations, to find out more about it.
Eight years in the making, the Social Enterprise Fund recently got off the ground in February. A joint initiative of the Edmonton Community Foundation, the City of Edmonton, and the United Way of Alberta, SEF aims to become an $11 million fund with $21 million in loans in the next five years.
What’s a social enterprise? SEF defines it as “a hybrid that combines social intent & the for-profit business model.” Just as a traditional enterprise is concerned with return on investment (ROI), the social enterprise is concerned with social return on investment (SROI). What’s the difference? SROI aims to capture the social and environmental benefits of projects, whereas ROI typically does not. You can learn more about social enterprises at Wikipedia.
There are three main criteria that potential SEF clients must meet:
- Social comes first.
- Business thinking is integral.
- Profits are reinvested into the mission.
SEF will sit down and talk with potential clients to ensure they meet these criteria. In fact, there are no application forms or deadlines – SEF takes a much more intimate approach, working with clients directly.
They key thing SEF can provide is a loan. The goal is to help non-profit organizations move away from grants. Examples of financial packages include:
- Housing or mission related: up to $500,000, 1 year term
- Building purchases: up to $250,000, 10 year term
- Existing social enterprises: up to $150,000, 5 year term
- New social enterprises: up to $50,000, 8 year term
While the terms can be very flexible, the loans are not forgivable. In addition to loans, SEF offers business expertise, educational seminars, and more. Organizations that SEF has worked with already include Flavour Budzzz and E4C’s Kids in the Hall Bistro. Other examples of social enterprises include Habitat for Humanity’s ReStores, and Earth Water.
The Social Enterprise Fund is the first of its kind in Alberta, though the concept is actually quite common in other parts of the world. In fact, there’s even a Social Enterprise Alliance. Next April they’ll host the tenth annual Social Enterprise Summit in New Orleans. We’re clearly a bit behind here in Alberta, but I’m really glad to see something like this launch in Edmonton. It’s a great program for our community.
You can learn more about the Social Enterprise Fund at their website, which includes a 14 minute video overview of the program. If you have an idea for a social enterprise, make sure you call or email them!
UPDATE: Turns out SEF isn’t really the first of its kind in Alberta. Just found Social Venture Partners Calgary via Sharon. It started in November 2000. Their model seems to have a greater focus on philanthropy.
UPDATE2: Also via Sharon, there’s a free workshop on SROI taking place on June 26th at MacEwan. Download the information sheet (PDF) here. You’ll need to RSVP if you want to attend.