EVPA Conference held in Norway for the first time – Europe’s largest meeting place for venture philanthropists and social investors
Ferd takes its second equity stake in a social entrepreneur, Gammel Nok, which also joins the active FSE portfolio
Drive for life (Kjør for livet) is acquired by Aberia, which wishes to use its ownership to expand this company’s activities. This is the second company in the FSE portfolio to expand via a private sector company
Social StartUp launched, which is an accelerator program with social impact – tailor-made to help newly set up social enterprises that have a double or triple bottom line become financially sustainable at an earlier stage
Motitech, which has an innovative solution for motivating older people to exercise, was crowned Social Entrepreneur of the year – and is now expecting to expand its activities
2017 saw Ferd Social Entrepreneurs (FSE) challenge politicians using the social results of its social entrepreneurs and engage in political debate at Oslo’s House of Literature venue. 2017 was also the first year in which the largest European conference for venture philanthropists and social investors was held in Norway. And, last but not least, 2017 saw FSE launch Social StartUp, an accelerator program with social impact.
The FSE portfolio also evolved in 2017 with the addition of a number of new and innovative companies. We also used equity investment as a means of financing a social entrepreneur, and one of the companies in the portfolio was given a significant boost by another private sector company.
In addition, the Norwegian Parliament voted in 2017 for social impact bonds to be trialled in the Norwegian market. FSE already has a mandate to invest in social impact bonds. Furthermore, FSE continued its successful collaboration with the Norwegian central association for municipalities (KS). FSE was an important contributor at the 2017 “Municipalities of the Future” conference, and signed a first of its kind collaboration agreement with the Bærum Municipality, the aim of which is to create a market for social entrepreneurs in the municipality.
In addition, the Norwegian Parliament voted in 2017 for social impact bonds to be trialled in the Norwegian market. FSE already has a mandate to invest in social impact bonds.
The ecosystem for social entrepreneurs attracted a great deal of interest in 2017 across a number of different channels:
- At the highest level, policymakers were challenged to a political debate on social entrepreneurship at Oslo’s House of Literature. Politicians have an important role to play in terms of removing some of the barriers encountered by social entrepreneurs and helping the market to mature faster. In this regard, if Norway’s population is to benefit from the best solutions, it will be important for members of parliament to insist on changes and to facilitate collaboration with social entrepreneurs.
- On a more practical and applied level, FSE continued its close dialogue and collaboration with KS in 2017. In 2016 Jan Tore Sanner, the Norwegian Minister of Local Government and Modernisation, launched an ‘inspiration booklet’ for using social entrepreneurs in the local government sector that was prepared in collaboration with FSE and KS among others. FSE and KS took this work further in 2017 and produced workshop materials that can be used by local government sector employees with social entrepreneurs in order to together identify how they can best collaborate and what barriers potentially need to be overcome for them to set up a collaboration. Workshops of this type are designed to increase the understanding that social entrepreneurs and municipalities have of each other’s ways of working, decision processes and solutions, and so to facilitate and promote more collaboration.
- Due to the importance of close collaboration between municipalities and social entrepreneurs, FSE had a strong presence at the 2017 “Future of Municipalities” conference (the Arendal conference). Since 2001 this conference has developed into an innovative meeting place for Norwegian municipalities at which important questions relating to future challenges can be put on the agenda. The conference has attracted collaboration partners from business and industry, academia and the public sector, giving the conference several extra dimensions. The Director of Ferd Social Entrepreneurs, Katinka Greve Leiner, was the master of ceremonies in both 2016 and 2017, and a number of social entrepreneurs were also presented on stage. A “speed-dating” event was also arranged between social entrepreneurs and conference attendees, and there were also workshops at which material from Ferd’s Inspiration Booklet (see above) was used.
- FSE also sought in 2017 to facilitate collaboration between social entrepreneurs and municipalities in a more concrete way, namely by entering into a collaboration agreement with Bærum Municipality. The agreement was signed by Bærum Municipality’s innovation department, and can be summarised as all of the parties involved working together to trial collaborations with three of the social entrepreneurs in Ferd’s portfolio over the course of 2017/2018. We made good progress with the collaboration in 2017 and have already gained some interesting experiences and learning points. We believe that we will be able to trial a practical collaboration in 2018 involving a number of our entrepreneurs, and that this will potentially pave the way for more collaborations. Examples can be very persuasive, and we believe that having a concrete example of a collaboration that works, and indeed being able to explain what we did in order to set it up (the procurement process, the parties involved, the contracting process etc.), will enable us to contribute to the ability of social entrepreneurs to enter in future into collaborations with both Bærum Municipality and other municipalities.
An important event in 2017 that may affect the market for social entrepreneurs was the Norwegian Parliament’s decision to issue social impact bonds in 2018. A social impact bond involves a private investor financing an initiative that has a defined target, with the investor reimbursed by the state if the target is achieved. The authorities pay only if the target is achieved, and investors therefore only make a return if society also benefits. In this way social impact bond soffer an alternative model for public-private partnerships with sharing of the risk and responsibilities involved. The model puts the emphasis on the results achieved by initiatives rather than on the activities involved and the resources spent, and makes it possible for new measures and solutions to be tried out more quickly. In Finland in particular social impact bonds have been issued for a number of years with significant success, and we hope to be able to write in FSE’s summary for 2018 that the first social impact bond has been tested in Norway. FSE has a mandate to invest in social impact bonds and will be keen to see whether a suitable, high-quality opportunity presents itself in 2018.
We had eight active portfolio companies at the end of 2017, three of which joined in 2017. Gammel Nok became our second equity investment.: New companies:
Atlas Kompetanse: Atlas Kompetanse works to prevent social exclusion among children and young adults from minority backgrounds by strengthening dialogue between newly arrived parents and the Norwegian welfare system. Atlas Kompetanse’s consultants offer multicultural skills and speak the same languages as the parents. The consultants also have professional backgrounds as teachers, social workers, child protection workers and social scientists. The company’s founders are Saad Yusuf Hashi and Firdawsa Ahmed, who had the idea after having worked at the City of Oslo and seen that there was a need for greater understanding of the system in relation to people new to Norway.
Generation M: Generasjon M creates relationships between generations by offering visiting services to elderly people living in nursing homes, assisted living homes and their own homes. The company’s ‘visiting friends’ are young people aged between 14 and 20 who carry out activities for elderly people, either individually or in groups. The young and the elderly get to know each other by sharing their knowledge, interests and experience. The company was started as a youth enterprise and is now run by two of its original founders, Anne Stine Hole and Christina Væting Nergård.
Gammel Nok: Gammel Nok was crowned Social Entrepreneur of the year in 2015 and FSE took an ownership stake in the company in 2017. The company provides advice, training and facilitation services related to the development and retraining of older adults. It also provides workers for temporary and permanent positions in the public and private sectors, as well as older people to provide practical help at home, both indoors and outdoors. Truls Nordby Johansen is the company’s founder, and he had the idea for the company when his father had to take early retirement.
Three new companies have joined the portfolio, while two have moved to the Alumni portfolio, namely Drive for Life and Lærervikaren. Drive for Life was acquired by Aberia, and we think the fact that a private sector company wanted to acquire a social entrepreneur to develop and scale up its solution to help young people is a pleasing sign. We in FSE see that we can play an important role in relation to private sector companies by demonstrating how we work with our social entrepreneurs in terms of how they manage and measure their social impact. Our – and a social entrepreneur’s – mindset is that strategic and operational decisions should optimise the social impact created by the company – and that this should permeate how the company set up its activities and manage their results.
The annual SosEnt conference that Ferd has organised for a number of years was replaced in 2017 by the European Venture Philanthropy Association (EVPA) Conference, and this year’s conference was therefore a very important European meeting for venture philanthropists. The EVPA is a European umbrella organisation for investors who primarily value the contribution their investments make to social value creation, as well as generating a financial return. The EVPA holds its annual conference in a different European location each year, and Oslo was chosen for 2017. FSE has been a member of the EVPA for a number of years and is also an important contributor to the organisation, with the Director of FSE, Katinka Greve Leiner, sitting on its board. The fact that Oslo was chosen is seen as recognition of the work that is done in Norway, and one of the topics that was emphasised at the conference was the Nordic countries’ welfare model.
The conference attracted over 540 people, with over 100 from Norway. The conference offered Norwegian investors a rare chance to learn more about what is happening within the areas of impact investing and social entrepreneurship outside Norway. Internationally there is an increasing trend for both private and institutional investors to pursue social impact in addition to traditional financial profit, in parallel with seeking to take a more business-like approach to the way in which they make their corporate contribution to society. FSE believes that there is significant potential for this in Norway, particularly for financial foundations and funds – and we were therefore very pleased that the City of Oslo, the DNB Savings Bank Foundation, the SpareBank 1 Østfold Akershus Foundation and TD Veen joined us as hosting partners, and we are very grateful for their contribution.
Despite the different orientation of the conference in 2017, the Social Entrepreneur of the Year award was held almost as before. However, in line with the conference’s European dimension, the applications were considered by a European jury, and special weight was also accorded to the scalability of social entrepreneurs and their potential to grow outside Norway. The aim was to challenge Norwegian social entrepreneurs to think bigger in terms of their potential and to provide them with an international conference at which to showcase what they do.
The five social entrepreneurs nominated for the prize were Motitech, A Drop in the Ocean, Chooose, Braive and Nyby. Motitech, with its innovative solution for motivating older people to take physical exercise, was the winner. Motitech’s solution, known as Motiview, consists of a screen showing motivating videos combined with a customised exercise bike for elderly people and people with dementia. The screen gives users access to an extensive library of films that makes it possible to play a film selected for each individual user. Motitech’s technology is in use in 40 municipal institutions in Bergen and in around 140 in the Nordic region in total.
The annual SosEnt conference that Ferd has organised for a number of years was replaced in 2017 by the European Venture Philanthropy Association (EVPA) Conference, and this year’s conference was therefore a very important European meeting for venture philanthropists.
An important and major focus in 2017 was the creation of an accelerator program with social impact for social entrepreneurs, known as Social StartUp. Social StartUp is a tailor-made program to help new entrepreneurs with a double or triple bottom line to become financially self-sustaining at an early stage. The program was launched in October 2017 and is a collaboration between FSE and SoCentral. The program is based on a well-tested model from Denmark’s Social Capital Fund, which is also an important collaboration partner for the accelerator’s roll-out in Norway.
The application deadline for the program was in November 2017, and the level of enthusiasm and interest was unexpectedly high – well over 100 companies applied to participate in the program. 30 of these were selected to participate in a three-day boot camp in January 2018, after which 10 will be selected for the six-month accelerator program. Important key aspects of the content and support these companies will receive include their own dedicated business developer with whom they will have weekly “shoulder-to-shoulder” meetings and work sessions. In addition, they will attend camps with relevant specialist and themes, as well as access to capital, networking, and possible collaboration partners. We are excited to see the results of this initiative in 2018.
An important and major focus in 2017 was the creation of an accelerator program with social impact for social entrepreneurs, known as Social StartUp.
The number of full-time equivalent positions in the business area was 4.7 in 2017, split between 5 permanent employees. The team consists of three women and two men. The expanded team is enabling us to work more closely than previously with the entrepreneurs. It has also allowed us to strengthen our focus on developing the market for social entrepreneurs, and we have been able to spend more time on working with other potential investors.
Social entrepreneurship is a growth area internationally, and the field is attracting increasing interest in Norway. Internationally we are seeing the rise of “impact investing” among more investors, and interest in this is also increasing in Norway, even if we would like to see both private and institutional investment organisations even more decisively involved in this area.
The Norwegian Parliament’s decision to investigate the possibilities of social impact contracts in 2018 could represent an exciting opportunity for social entrepreneurs in Norway. The opportunities for social entrepreneurs and for Norway’s welfare system can be large, if we can manage to facilitate innovation in how welfare services are provided. We are committed to the social impact being measured for the people who receive the services in terms of both the design of the services and the procurement processes.
As in previous years, FSE was approached by numerous parties looking to learn from our experience in the field and to collaborate with us on potential projects. We have chosen to prioritise the use of our resources on teams and individuals where we think there is good potential for practical action and benefits that will further the cause of social entrepreneurship. At the same time, we believe that setting up Social StartUp can contribute to the development of the ecosystem for social entrepreneurs and will obviously help promote sustainable social entrepreneurs. Our big ambition is for Social StartUp to launch nationwide and also to potentially become a Nordic program in the future.
Having previously had a particular focus on children and young people, we are now primarily (but not exclusively) focused on four main areas: “Early start (prevention)”, “Knowledge brings development”, “Work is ennobling”, and “Old and valuable”.