The culture of the third sector is stopping social enterprises from growing by mergers and acquisitions, claimed several social enterprise leaders yesterday.
A CAN Breakthrough conference on mergers and acquisitions heard a number of speakers blame cultural antagonism for the lack of merger activity.
Craig Dearden-Phillips said: 'Mergers are counter-cultural in the sector we operate in. Some people think I'm an empire building maniac just for talking about it.'
The Big Life Group CEO Fay Selvan said that she too had been attacked with the 'empire builder' tag.
She said: 'I have been called an empire builder as well and I said, "Yes, I'm building an empire to change the world."'
Jonathan Lewis, CEO of the Social Investment Business, said: 'Part of the problem with the third sector as regards growth is cultural.'
HCT Group CEO Dai Powell said there were too many organisations that 'exist to exist' and too many people resistant to change because of vested interests.
In the lead up to the conference the CAN Breakthrough programme conducted a snap-shot poll of the 70 invitees. It found only 33 per cent had been involved in mergers and acquisitions while almost 80 per cent believed there should be more.
...as Susan Boyle might have sung. On SocialEnterpriselive.com this week:
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Comments
Amen: People need to think quality, then argue scale or no scale
As an innovative fast growing social business, we have encountered loads of detractors. Many have tagged our relatively small business with empire building as well. Funny thing; you would think success would attract more friends or at least the optimistically curious, but it attracts the opposite in the 3rd sector. Strange paradox.
The sector is obsessed with the small for small's sake. The focus needs to be on quality, not size. Lots of social businesses will remain small because it just works better at that scale; however, lots more would benefit from scale.
I am glad to see notable players beginning to speak out about the stuck in the mud culture that exists to keep more of the status quo.
Todd Hannula
www.socialcatalyst.co.uk
Todd Hannula
CEO of Shine Ltd (CIC), and its parent company Camberwell, Ltd.
http://www.socialcatalyst.co.uk
http://www.shinebusinesscentre.co.uk
Mergers and Acquisitions
Remember how and why Housing Associations were created?
The idea was they would be more accountable and responsive by being focussed on distinct communities.
Over the last 30 years they've merged and merged and acquired and merged again, becoming national if not international, agencies.
Now they are far removed from their "customers" and communities; far further than their Local Authority predecessors would have ever imagined.
Mergers and acquisitions have their place in any sector, but neither Social Enterprise nor any structural/sectoral solution is any panacea for "saving the world".
The emphasis and considerable funding targetted at this policy - and on other 2nd tier agendas - only highlights the lack of truly sustainable ideas.
Brian Craven Business Advisor Social Enterprise Development St Helens Chamber T. 01744 742000 ext 2227 M. 07825 383613