March 12

‘Social enterprises go bust all the time’ – how the sector is tackling its image problem

By Emma Sheppard

When Emily Mathieson set up her homeware business Aerende in 2016, she didn’t know it would be a social enterprise. She hadn’t even heard the term before. Aerende’s products are made by people who face social challenges, including survivors of trafficking and people with learning disabilities. “I wanted to set up a business doing what I wanted to do, and I wanted to make sure it wasn’t going to have a negative effect on the world,” she says. “So I sort of fell into social enterprise.”

Fast forward 18 months and, despite a number of big wins and 400% growth year-on-year, Mathieson isn’t sure it’s a sustainable business model.

“My commitment to ethics makes everything more expensive and much more time-consuming,” she adds. “My margins are smaller … and a lot of routes to funding are closed to me,” she says.

Most social enterprises, including Aerende, are established as a company limited by guarantee, which means there’s no share capital or shareholders, and the business may be excluded from applying for a grant because it is not a registered charity.

Photo courtesy of David Weekly.

Source: The Guardian (link opens in a new window)

social business, social enterprise, social entrepreneur, social entrepreneurship, social impact