Selling a no-brainer can be surprisingly tricky
We do all this because Match Trading can benefit funders and social enterprises. The broken finance market currently assumes that social enterprises need either 100% (traditional grants) or 0% (investment) subsidisation. But most social enterprises need something in between: they can cover a percentage of their operating costs through trading revenue, and can be incentivised to increase that percentage without risking pure investment or relying purely on grants.
Thanks in part to the catalytic effect of the Task Force, the number of social enterprises supported and Match Trading grants issued have increased exponentially. Over 600 organisations have received a Match Trading grant. We are now seeing the benefits of Match Trading grants in action.
Between 2017 and 2020, Match Trading grant recipients we’ve worked with typically increased their trading revenue two and a half times more than traditional grant recipients. Higher trading revenue means more resilience and sustainability, and usually resonates with the founder’s vision: running a sustainable business, not spending time applying for grants.
Given these benefits, it is a head-scratcher as to why Match Trading isn’t higher on funders’ agendas. Because if Julie’s Cafe increases its trading revenue, a Match Trading grant means the funder can afford to redirect more money elsewhere, creating more impact overall.
Although the concept is simple, implementing Match Trading grants and proving impact has been more complex. This is why collaboration has been extremely valuable - indeed, necessary. The Task Force has allowed funders to share the risks of experimentation, problem solve together, collectively build enough data to generate useful insights and join forces to exert more sector influence.
It hasn’t all been easy. The proliferation of Match Trading has been slower than we would have liked. Asking funders to focus on financial sustainability per se - versus specific social issues, or geographic areas - has been a challenge, and Covid-19 hasn’t helped.
But generally the Task Force has operated smoothly, and has been vital to Match Trading’s development. Carol Mack, CEO of the Association of Charitable Foundations (ACF), chairs the Task Force, with the SSE as secretariat. Having a credible, independent chair with funders’ best interests at heart has been helpful. Involving beneficiaries - social enterprises in receipt of Match Trading grants - has also communicated openness and broadened the existing spirit of sharing and generosity between partners. These ingredients, plus time, mean trust has deepened like a good compost, and ultimately sustained the group for longer than I thought possible. Match Trading is a small topic that keeps on giving, and through collaboration can give a lot more.