Social enterprises are playing a growing role in the health and social care sectors in the UK. Much of this growth is coming from ‘spin-outs’, organisations leaving the NHS and other public sector bodies to become independent social enterprises.
In August last year the Community Investment Fund made a loan to the Devon based social enterprise Chime, the first and only audiology spin-out in the UK (you can read more about our investment here). Chime runs dedicated hearing service clinics across 15 locations throughout Devon and as a social enterprise, reinvests profits into delivering more and better services. The loan enabled Chime to have a high street presence in central Exeter for the first time, offering local residents crucial hearing services and advice and giving Chime the opportunity to grow as a sustainable business.
Our investment in Chime has not only given SASC the opportunity to back a great social enterprise, it has also inspired us become more involved in supporting the spin-out movement across the UK. On May 3rd we are delighted to be running a roundtable focused on spin-outs with our partners at BWB where we will be addressing many of the financing and legal questions faced by spin-outs as they continue to grow – more information about the event soon!
Spinning out offers social enterprises the opportunity to deliver better services for people; it also gives passionate leaders the opportunity to become real change makers. As Chime CEO and Lead Clinician said of his motivation for spinning out:
“We felt there was an opportunity to secure the way we were working more effectively in a difficult financial environment and to have more control over the decisions we were making in relation to the care of the patients.”
Chime used the government Right to Request scheme to spin out and adopt a social enterprise business model in 2011 by setting up as a Community Interest Company (CIC). While Chime has continued to deliver services on behalf of the NHS, it has also been successful at renegotiating its supply chain contracts outside of the NHS procurement process, generating significant savings which it reinvests into the care of patients. Once it became established as an independent organisation, Chime recognised it needed additional investment to be in a position to secure more contracts across the country, offer more and improved services and thus increase its social impact. From spinning out to becoming investment ready, Chime worked with Stepping Out through the Investment and Contract Readiness Fund process to develop a business plan to raise social investment.
We look forward to supporting more spin-outs like Chime who are passionate about building sustainable businesses focused on improving people’s lives.