New research shows social entrepreneurs, charities and community businesses who have taken advantage of Match Trading grants are increasing their income from trading at 2.5 times the pace of those supported by a traditional grant.
Match Trading is a new type of grant-funding that pound-for-pound matches an increase in income from trading, created by the School for Social Entrepreneurs (SSE).
Launched in 2017, Match Trading grants have been awarded to 500 voluntary, community and social enterprise organisations as part of SSE learning programmes. These programmes have been run in partnership with a number of organisations including Power to Change, Rank Foundation, Lloyds Banking Group, the Scottish Government, Guys and St Thomas Charity, The National Lottery Community Fund and Access – the Foundation for Social Investment.
By rewarding sales growth, Match Trading incentivises social organisations to develop their trading base, become less grant dependent and so help build a stronger sustainable social sector.
Research into 143 organisations revealed that they typically increased their income from trading by 17,000 an uplift of 64% – compared with their income from trading in the previous year.
They were incentivised by a Match Trading grant capped at either 4,000 or 10,000, and a learning programme from the School for Social Entrepreneurs.
They outperformed a control group of 30 community businesses, who received a traditional grant of 10,000, as well as a learning programme. The control group typically increased their trading income by 6,453 – or only 21% – compared to the previous year.
A typical Match Trading grant recipient also increased the ratio of income from trading vs grant funding from 58% to 69% in just a year.
Carol Mack, CEO of the Association of Charitable Foundations and chair of the Match Trading Task Force said: ‘These latest figures are incredibly encouraging for the future potential of Match Trading grants. Our aim is to help support stronger and more viable voluntary, community and social enterprise organisations, capable of achieving truly sustained impact.’
Alastair Wilson, CEO of the School for Social Entrepreneurs, said: ‘Match Trading grants work best when they form part of a learning programme. The supportive environment helps develop the entrepreneurs skills, confidence and an entrepreneurial mind-set, whilst the Match Trading grant empowers and incentivises the organisation to upscale their trading potential.
‘The Match Trading grant is not a magic bullet and should be viewed as one way of helping organisations become less grant dependent. Social enterprises need a range of income sources, from funding to trading, depending on their business model, stage of growth and sustainability plan.’