September 2015

September 30, 2015

New base for Sparks

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A popular child care co-operative in Bristol has moved premises, bought new play equipment and improved its financial resilience with the help of a loan from Co-operative & Community Finance.

Sparks Play & Care, which provides high quality and convenient out-of-school childcare for some 150 families in the Ashley Down area of north Bristol, reopened for the new school year at new premises within Sefton Park School. The building, known affectionately as the Green Terrapin, can provide care for up to 70 children aged 3-14. There is also immediate access to outdoor play and exercise space.

The new premises is only a very short distance from the Youth Centre where the after school club had been based for 25 years. Despite the proximity, the move, and the uncertainty leading up to it, was very disruptive to the business.

Carole Theyer, chief executive of Sparks, said: “Co-operative & Community Finance were very understanding. The loan has helped with the inevitable extra costs of moving and with managing our cash flow.”

Carole helped to set up Sparks Play & Care as a workers co-operative in 2005 (it had previously been run by volunteers) and register it with OFSTED. She believes that the co-operative structure makes for a better working environment, higher quality child care and more satisfied parents.

Carole said: “We offer membership to our employees whether they are full time or part time, but do require that they are with us for at least six months initially in order to get a feel for the business and the way we operate.”

Sparks runs a breakfast club (7.30-8.45am) and an after-school club (3.15-6.00pm) during term time and a holiday club (8.15am-5.45pm) during school holidays.
The play workers aim to provide an environment that facilitates children’s freely chosen play with a large range of open access materials (art and crafts, books, dressing up, den-building materials, toys and games and computers). They plan daily activities, consulting with the children for ideas, and also try to extend their experiences culturally and awareness of the wider world.

Ian Rothwell of Co-operative & Community Finance said: “It’s so clear that Sparks provides excellent child care and that the parents love them. So we were very happy to help them with a loan to see them through the difficulty and disruption of moving premises.

“For this particular loan we used money from the Avon and Bristol Co-operative Loan Fund that had been bequeathed to Co-operative & Community Finance in 2007. It is very appropriate because Sparks was the first child care co-operative to be set up in Avon and Bristol.”

September 24, 2015

Before you apply

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Before you start any application, make sure you have everything you might need at your fingertips; documents, contact details, photographs, promotional material, facts and figures. Preparation will make the process quicker and easier. Be sure to check out the organisation to which you are applying – check criteria, research what interests them, and follow any instructions closely. Make a note of the date on which you apply, and be sure to make follow up enquiries.

If you’re seeking investment or applying for a loan, here are some things you might find useful to consider:

Seek advice

Co-operative and social enterprise networks and advice organisations can help you formulate a business plan, offer strategic advice and assist with applications. There are over 30 of these organisations in the UK details of which can be found here. For some specialist advice (for housing co-ops, local food, community shops, etc) click here.

Ensure your business plan is concise

Your business plan should be clear and concise. It’s good to include an executive summary.

Is this finance appropriate?

Make sure the finance you are seeking is appropriate to your needs and show through projections that you can service the debt. Do not borrow for a term that exceeds the life of the asset you wish to purchase.

Your rules should reflect governance intentions

If you are a co-operative or community-owned business you need to ensure that your rules allow for your stated governance intentions (eg how decisions are made and what happens to any profits). Test them against the seven ICA principles. If you are a member of Co-operatives UK, you will have access to a specialist legal team which provides advice on all aspects of governance.

Understand your market and check out the competition

Be sure of your market and the competition. Define the gap in the market that you will fill, and how you’ll deal with the competition’s reaction to your presence. List your USPs (unique selling points). If you present a SWOT (strengths, weaknesses, opportunities, threats) analysis, ensure you describe how you will exploit your strengths, mitigate your weaknesses, seize opportunities and lessen threats.

Convey enthusiasm, belief and passion

If you want potential investors and financiers to believe in your project (which you do), then you really need to believe in your project. Think about how you can convey passion in every part of your application. Have your members invested their own time and money in the venture? What are your dreams for the project/business/organisation? Why do you want to do this? What values drive the project forward?

September 10, 2015

Working with Ecology Building Society

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Ethical finance groups work together

Two long-established ethical finance organisations have agreed new arrangements that will make more money available to democratic enterprises in disadvantaged communities.

Ecology Building Society has lent £500,000 to Co-operative & Community Finance, and under the terms of the government Community Investment Tax Relief (CITR) scheme this money will be used to stimulate enterprise in deprived parts of the UK.

Co-operative & Community Finance, established in 1973, is the oldest Community Development Finance Institution in the UK and one of the few that is authorised and regulated by the Financial Conduct Authority in the conduct of investment business. It normally has £4m to lend to member-owned enterprises but following a record year of lending in 2014 more funds were needed to meet the increasing demand.

Ecology Building Society was set up in 1981 with the aim of using members’ savings to provide mortgages and loans to properties and projects that have a positive impact on the environment and communities. It has over 9,000 members with a total of £138m savings.

The two organisations had worked together before in the joint funding of housing co-operatives and community-owned shops, so a closer partnership which benefited them both and helped them deliver their objectives made sense.

Ian Rothwell, Development Manager at Co-operative & Community Finance, said: “When we realised that we may need additional funds to meet the demand for our ethical finance it made sense to approach Ecology Building Society. We share similar values and are keen to invest in the same projects and enterprises.”

Paul Ellis, Chief Executive of Ecology Building Society, said: “We are pleased to be strengthening our links with Co-operative & Community Finance who have an excellent track record in working with start-ups in the community sector. We strongly believe in finance organisations pooling their respective skill-sets for the common good, enabling us to amplify our impact. This collaborative approach is something that our members welcome.”

In a further display of the growing closeness between the two ethical finance organisations, Ian Rothwell was invited to address Ecology Building Society’s well attended AGM in Liverpool.

The CITR scheme, launched in 2002 and revised in 2012, was devised to stimulate the flow of private finance to support enterprise in the UK’s deprived communities. This rare case of two member-owned enterprises using the scheme for mutual benefit is a pragmatic example of the co-operative value of self-help.