The entrepreneurial opportunity

Parcel - sA recent article in Third Sector magazine made me smile.

It wasn’t just because of the pun-tastic title “The rise of subscription services: How charities are thinking inside the box” (the story was about non-profits who’ve developed successful subscription gift-box services). Nor was it simply because it’s a positive story, although it is: one of the examples is Scope’s “Mindful Monsters” gift-box service which started out in 2017, has turned over £1.5m already, and looks set to provide returns in-line with face-to-face fundraising investments.

You might think it’s because I’m a huge fan of charities developing earned income, particularly where it also serves the mission, as Mindful Monsters is doing. And I am, so it’s brilliant that these stories are getting out there to inspire other organisations to give commercial ideas a much bigger profile in their plans. But that’s not the reason I smiled either.

No, the reason it made me smile was because the picture it paints is of a brand new wave of business model innovation, pioneered by digital services like Netflix and Amazon, expanded by the commercial sector into everything from razor blades to makeup, and “finally” being latched onto by the third sector.

In the mid-eighties, I was just a teenager when I first became a member of the World Wildlife Fund. At the time there were different levels of membership, and I went for the highest level my Saturday job could afford, prestigiously entitled: Companion of the WWF. Why? Because it came with a free monthly subscription to BBC Wildlife magazine.

Every month, my gift-box, or “envelope” as we called it back then, would arrive, engaging me with pictures, stories and all the wonders of the natural world, at the same time, deepening my appreciation for all that WWF was there to protect. Some years later, the deal with BBC ended, the magazine stopped coming, but I carried on with the WWF membership because by then the hooks were far too deeply embedded for me to pull out. It’s something of an irony therefore, that thirty years on, WWF has finally returned to subscriptions with a new offering called Amazing Planet, which would probably be perfect for my kids.

My point is that these business models are nothing new to charities – quite the opposite; half the sector was built on membership and subscriptions. The only difference is that businesses, arriving a quarter of a century late to the party, fully embraced it. They saw the greater opportunity, added more value, went all-in, and took it to a scale that charities had never even conceived.

The biggest lessons that charities can take from businesses are not the models or the mechanics of money-making – their roots are just as deep in the sector as they are anywhere else. The biggest lesson is the mindset and ambition, to take a proven commercial idea, and to scale it to such a size that it can change the world.

It’s a lesson that Scope might just have learned: their stated ambition for Mindful Monsters is for it to become a global ethical consumer brand for children. Now that really would be an inspirational story, and I’d love nothing more than to be able to write about it in a few years’ time.

In the meantime, though, if you want to find out more about the models and opportunities of commerce in charity, here are five things to consider:

  1. The Commercial Charity book will be published by Kogan Page on 3rd April and is available to pre-order now from most online booksellers.
  2. I will be speaking at the NCVO annual conference on 20th April in Workshop A3, on “Thinking differently about income generation” – I believe tickets are still available. If you’re there, come and say hello.
  3. The next Charity CEO Breakfast seminar is on 28th April in London, when we will be talking about collaboration and consolidation, from strategic partnerships to M&A. This is free but strictly for CEOs only – currently only three seats remain, contact me if you’d like to enquire about joining us.
  4. On 5th May I will be co-hosting “an evening forum of charity and commerce” with Carol Homden CBE, CEO of Coram, in Bloomsbury, with a panel of excellent guests from across the sector; places are still available but running out fast – contact me to reserve a seat.
  5. And on 20th May I’m running a free morning seminar, open to anyone in a senior role within a non-profit organisation, on developing and improving commercial performance, with special guests from various major charities – email me if you’d like to register to attend.

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