Ferd Social Entrepreneurs (FSE)
Social impact bonds were put on the map in Norway. Norway’s first social impact bond was signed, and social impact bonds were also the topic of the 2019 SosEnt Conference.
iMal was awarded Social Entrepreneur of the year
We have made a podcast: Impactpodden Download to listen to ten episodes on social entrepreneurship.
Impact Startup (previously Social Startup) set up a collaboration with organisations in Sweden, Denmark and Finland.
Ferd Social Entrepreneurs (FSE) Invests in social entrepreneurs that can demonstrate measurable social results, and it contributes to the consolidation of their market. FSE provides these companies with networking, expertise and capital in an active partnership with defined milestones and set social targets.
2019 saw the field of social entrepreneurship mature further. Norway’s first social impact bond was signed between FSE, Trygg av natur and Lier Municipality. Social impact bonds topped the agenda at the 2019 SosEnt Conference to which we welcomed a total of 250 attendees from the public and private sectors, as well as social entrepreneurs. In 2019 we were also strongly focused on impact management.
Greater collaboration with the other Nordic countries is increasing expertise in impact management, which is important to ensuring that the companies we work with become even better at measuring and managing the social impact they generate.
In 2019 FSE continued to collaborate with innovative social entrepreneurs, and by the end of the year there were more equity investments in the portfolio than companies Ferd has supported through grants. We are pleased that our social entrepreneurs are keen to have FSE on board, not only as a supporter but also as a co-owner. It is clear that the growing trend for private and institutional investors to seek social impact in addition to a traditional financial return has become even more evident.
At the end of 2019, FSE had ten companies in its portfolio (Atlas, Auticon, Barnas Plattform, Gammel nok, Generasjon M, Medarbeiderne, Mestringsguiden, Motitech, No Isolation, Unicus) and one fund investment (SKF Invest). FSE made one equity investment in 2019, namely in Mestringsguiden, and it increased its ownership interest in Unicus in the autumn.
Mestringsguiden, in which FSE took a stake in 2019, is a social entrepreneur that helps people from a refugee background into work and thus to become financially independent. Mestringsguiden operates a food stall called Aleppo Bahebek in Vippa, a restaurant called Injera Palace, and a café called Frodig in Oslo’s Grønland neighbourhood. The company also operates Inshalla Catering, which delivers Syrian and Eritrean food from both Aleppo Bahebek and Injera Palace.
In 2019 we increased our ownership interest in Unicus, which provides high-quality IT services in relation to development, testing, quality assurance and data science. What makes the company special is that all its consultants have an Asperger’s diagnosis. At Unicus, the consultants’ unique characteristics are a competitive advantage rather than a social challenge. In 2019 Unicus scaled up its activities in Sweden and opened an office in Finland. The company was one of the first companies to be admitted to the portfolio, and in its first three years we provided it with support in the form of expertise, networking and funds. It now employs 60 people.
FSE has worked for a long time to make it easier for social entrepreneurs to reach out to their customers. A key part of this work is engaging in dialogue with different public bodies and municipalities. Our experience is that there is a lot of commitment to the value creation that social entrepreneurs represent, but we have also come to understand the obstacles municipalities and other organisations perceive and experience when engaging with small and innovative suppliers.
One of the most exciting developments in the area in 2019 was the signing of Norway’s first social impact bond. A social impact bond involves a private investor financing an activity with a fixed performance target, with the investor reimbursed by the public sector if the target is met.
The authorities only reimburse the private investor if the pre-agreed results are achieved, and the investor is only repaid if society itself benefits. The signatories to Norway’s first social impact bond are Trygg av natur, Lier Municipality and FSE, and the short-term aim is to increase self-mastery and motivation and to reduce stress. Over the longer term, the aim is to reduce the dropout rate from lower secondary school. Ferd is financing the project, Trygg av natur is running it, and Lier Municipality will reimburse Ferd half its investment if the agreed results are achieved. In addition, the municipality will learn from the experience and will continue the measure if it functions as expected. The contract also enables FSE to trial an innovative solution that we believe will deliver good results and reduce the dropout rate from lower secondary school.
Social impact bonds were the topic of the 2019 SosEnt Conference. The topic attracted a lot of interest and curiosity despite being relatively small in scope compared with the topics of previous conferences. The conference was a success and gave attendees the chance to hear a range of interesting speakers from across Europe.
We also continued to organise regional meetings across Norway to facilitate collaboration between municipalities, social entrepreneurs, private companies and the not-for-profit sector. Four regional meetings were held in collaboration with the Norwegian Association of Local and Regional Authorities (KS), Innovation Norway and SoCentral.
Impact StartUp (previously Social Startup) is a tailor-made accelerator program that helps fledgling entrepreneurs with a double or triple bottom line become financially sustainable earlier than they would otherwise have achieved. Since last year a Nordic-wide collaboration has been entered into with Denmark’s Social Capital Fund, Sweden’s Prosper and Finland’s Arvoliitto. 90 companies applied to the program, 30 were selected to take part in an intensive three-day business development boot camp, following which 10 companies were chosen to take part in a six-month accelerator program. The 10 companies’ business developers worked shoulder-to-shoulder with each company and took part in three camps that looked in detail at customers, finance, social impact and management. The companies made good progress on their journey to deliver sustainable double or triple bottom lines.
In 2019 the FSE team had six employees equivalent to six full-time employees until the summer, after which it had five. One employee resigned before the summer, and one employee went on maternity leave after the summer. A temporary replacement was appointed with effect from August and a new employee will join the team in the spring of 2020, which will mean the team will be at full strength once again. Despite the somewhat lower headcount than usual, we have managed to make a difference and leave clear footprints.
Social impact bonds are now on the map and we believe that more will be signed with the public sector in the time ahead, including contracts with other investors on board.
We will continue to attach importance to impact management work with our social entrepreneurs and will also look at new technical solutions for how we can work on and document social impact in a transparent and high-quality way. We will help the market for social entrepreneurs develop further, and especially in relation to the public sector, as many of the entrepreneurs with which we are in contact have good solutions to problems that are too big for the public sector to solve on its own.