Ontario’s social enterprise sector is dynamic and growing rapidly, as described in Enterprising Change: Report of the 2015 Social Enterprise Survey for Ontario.
597 social enterprises (SEs), both non-profit and for-profit, reported to a team of researchers creating significant economic and social impact across a diverse range of industries. The report finds a great deal of momentum, but also highlights challenges that are worth considering.
Creating jobs, contributing to the Ontario’s economy
Social enterprises in Ontario employed at least 12,000 people in 2014, more than half of which were full-time equivalents. They earned over $380 million dollars of revenue through the sale of goods and services alone.
These are just cold, hard, numbers. But they don’t even begin to capture the vibrancy of what these sales lead to, the importance of what this work means to so many people. The overwhelming majority of SE work in, and draw from, the local community. They engage with tens of thousands of volunteers and provide training and employment to people from marginalized backgrounds. Half of them have a focus on poverty. These organizations are doing work that matters.
Uncertainty amidst opportunity
Despite the increasing success of SEs across the province, challenges persist that need greater attention.
Access to capital remains a significant barrier to development, although the growth of the social finance ecosystem has clearly made a difference. Only a quarter of non-profit SEs receive loans (although this number has gone up by 150% since 2012, indicating greater risk tolerance from both SEs and impact investors). For-profit SEs are more able to use loans, with 68% of them reporting loans in 2014. Even more promisingly, most of these loans came from banks, credit unions and corporations, not private investors. This indicates greater institutional investment flowing into social enterprises.
Brand recognition and awareness is another area of concern – one that 40% of nonprofit SEs and 65% of for-profit SEs battle with. A common perception is that social enterprises have inferior products, but organizations lack the marketing muscle to change the image. The lack of a common understanding around social enterprise also poses challenges when it comes to recruiting skilled staff and accessing funding.
Finally, many SEs feel like they lack the human and technological resources with which to make things happen. When it comes to human resources, the challenge is not just finding high-quality workers but also finding funding to pay salaries and succession planning. As technology requirements change, SEs are increasingly concerned about having up-to-date infrastructure and information technology. Many SEs have highlighted the need for more capacity building resources, such as online manuals and in person workshops.
Join us this Thursday at the Social Finance Forum at MaRS Discovery District as we discuss these challenges. In an interactive session led by and for social enterprises, we’ll develop recommendations for enabling growth. We look forward to your insights!
This article was originally published at socialfinance.ca
Nabeel Ahmed is the Network Coordinator for Social Enterprise Toronto. He is also a Financial Analyst at the University of Central Asia in Bishkek as part of a fellowship in microfinance and microenterprise with the Aga Khan Foundation Canada. Previously, he was the Managing Editor of SocialFinance.ca, where his keen eye and deep knowledge of the field aided him in supporting the conversation around social finance and impact investing in Canada.
He has experience managing content, partnerships, media, and volunteers for multiple nonprofit organizations and initiatives. With a background in business, public administration, nonprofits and social enterprise, he is interested in supporting the creation of multi-sectoral partnerships to address wicked problems.