The first copies of The Big Issue magazine went on sale in 1991. Since then, it has helped more than 100,000 people affected by homelessness and poverty. While the magazine remains a key part of what The Big Issue Group does, it has also moved in new directions, and helped other social businesses to grow by making it easier for them to borrow money, access investment and find mentors.
Social businesses set out to solve social problems, not just make profits. It’s a model that’s woven into The Big Issue’s DNA, since it was founded by John Bird and Gordon Roddick. As co-founder of retailer The Body Shop, Roddick was at the helm of perhaps one of the best known examples of a social business.
Ten years after The Big Issue was set up, Bird decided to start a new initiative called Social Brokers, a sort of bank for social entrepreneurs. Its mission was clear: to provide access to finance for social businesses across the UK, especially those that were finding it hard to borrow money from traditional banks.
Around the same time, the then chair of The Big Issue, Nigel Kershaw, was working in the United States. He saw first-hand the growing trend towards social business, with big names, such as ice-cream company Ben & Jerry’s, highlighting that there was another way to do business. He also learnt that investors including foundations were investing for both financial and social returns.
The Social Brokers project evolved over time. In 2005, Big Issue Invest was set up, as the social investment arm of The Big Issue Group, with the aim of investing in businesses and organisations that tackle social problems and echo The Big Issue’s ethos of preventing and dismantling poverty. “Social Brokers was the genesis of Big Issue Invest. We started off firstly as a loan fund, lending to other social enterprises and charities that had trading arms,” explains Kershaw, the first chief executive of Big Issue Invest and the current chairman of The Big Issue Group.
What Big Issue Invest does
Over time, Big Issue Invest has moved beyond loans. It runs programmes that link social businesses with corporate mentors, manages millions of pounds worth of investment funds, and advises other investment funds too. The money it invests is distinct from The Big Issue magazine. “None of the investment capital for Big Issue Invest comes from the sale of the magazine,” Kershaw explains. Investors put money into the Big Issue Invest funds, and that money is then used to finance social businesses and charities. Investors get a financial return, just as they would with a regular investment.
One of the big challenges that Big Issue Invest faces is convincing people that it isn’t a charity but a finance venture. For Kershaw, it’s about looking at capitalism differently, and thinking about how investment can do good things to prevent and dismantle poverty.
Big Issue Invest has invested in a wide range of organisations and social businesses across the UK, including Hey Girls, which helps women and girls who can’t afford period products. It received a £50,000 investment and mentorship from Big Issue Invest’s Power Up Scotland programme, which has helped it to grow and to purchase stock. Hey Girls sells sanitary towels on a ‘buy one, give one’ model, meaning for every pack purchased another is donated to a woman in need.
Investment from Big Issue Invest has allowed Employability Trust, a Country Durham organisation that helps young people find sustainable work by giving them work experience in the manufacturing and production industry, to expand and land contracts with big-name brands such as Nando’s, Pizza Express, B&Q and Nissan. Employability Trust operates a 15,000 square foot factory and has commercial contracts, supplying a range of services from storage to furniture restoration.
Big Issue Invest has also backed HCT, a social enterprise that makes money by providing public bus services and then reinvests into community transport services and skills training programmes. Another of the social enterprises it has supported is Digital Mums, which teaches mums social media skills and pairs them with local SMEs, social enterprises and charities who can’t afford full-time social media managers.
Its investments are varied. But Big Issue Invest has also worked hard to ensure a varied pool of potential investors, after a comment from an audience member at a City event some years ago made Kershaw stop and think.
