Wide-ranging and tailored enterprise support can reanimate deprived communities

Last week, business secretary Vince Cable hosted a ceremony celebrating 3,000 businesses launched with the support of Outset, our enterprise creation and support service.

That we’ve achieved this milestone in a just over four years – working exclusively in deprived areas such as inner city wards, isolated rural and rundown coastal communities – is a testament to the effectiveness of our proven methodology.

And it provides valuable lessons for others seeking to replicate our success.

Launched in 2009 by the YTKO Group, Outset helps people from a range of backgrounds to become economically active through self-employment. To date, the service is estimated to have reduced the benefit bill, and generated GVA and tax receipts, to the tune of around £42m – delivering a 197% return on investment for funders.

But ‘equipping people for enterprise’ is just part of the Outset story.

The programme’s combination of personal development, business skills training and finance enable us to tackle head-on the complex mix of physical, social and economic deprivation that contribute to higher crime rates, poorer health, reduced mobility and lower levels of aspiration in inner city and other deprived areas.

Social exclusion
Through group workshops, one to one mentoring and online support, we help our clients to improve their skills, regain their confidence and achieve sustainable incomes – in so doing, strengthening local economies, cutting the costs associated with, for instance, supporting ex-offenders and substance misusers and, critically, reducing social exclusion.

In a typical project, over 75% of Outset clients have been previously unemployed and at least a third are long term unemployed. Nearly half face additional challenges – such as having few educational qualifications, health issues or English as a second language. And the proportion of BME participants invariably exceeds their regional representation.

Regardless of background, we work with our clients to assess the real-world potential of their business ideas – helping them to create robust business plans and ensuring their businesses are investment ready (so reducing risk for prospective lenders and investors).

Then we leverage established relationships banks, credit unions, crowd-funders and community development finance institutions – and draw on YTKO’s status as an approved government Start Up Loans partner, to help these individuals secure the finance they need to launch and grow.

Local focus
A truly local focus underpins everything we do. Unlike larger, less ‘nimble’ organisations, which are unable to adapt to each location’s unique needs, we work with local enterprise partnerships and local authorities to define genuinely tailored solutions, with partnerships at the core. Each Outset project has a network around 50 stakeholders, including government and public sector bodies such as housing organisations and job centres, third sector specialists like drug and alcohol rehabilitation centres and in some cases, private sector organisations. Indeed, we have just launched The Outset Foundation, a registered charity charged with leveraging capital, revenue and in kind support, such as mentoring and coaching, from the private sector for even greater impact.

To ensure our service is fully embedded within each community, we recruit staff from the local area and from within our target client groups and, where feasible, we use funding to convert vacant buildings into vibrant local enterprise centres. We then use a grassroots, community-wide approach to generate demand for the service, with a presence at local events, in job centres, in libraries, via social media and other highly targeted marketing initiatives.

The future
The success of our approach speaks for itself – with 97% of clients saying they would not have launched their businesses without our support. But there’s more to be done.

In our view, government must ensure that enterprise, and not just employment, is more effectively included in the social inclusion agenda. Encouraging a more entrepreneurial culture, challenging traditional attitudes to employment and promoting self-employment as a viable alternative should all be part of this agenda, along with a commitment to increasing the range of support available to would-be entrepreneurs.