Help is at hand for sport funding frustration
Organisations using sport for positive social impact are benefiting from new income streams thanks to Sporting Capital – the first investor in England to focus solely on the Sport for Development sector.
Launched in 2017, Sporting Capital is already supporting the growth of a number of organisations, helping them harness the power of sport for social change.
Jemma Leathley, Investment Manager at Sporting Capital, explained that by offering flexible loans along with extensive business support, they provide a viable alternative to the constant search for the next funding pot that can be a drain on so many sports organisations’ time and resources.
“The loan is a way to help these organisations break the grant-funding cycle,” she said.
“Grant funding is obviously crucial to a lot work they do but it’s decreasing in scale. It’s often harder to get and it can really limit growth because organisations can’t forward plan and bring on full-time staff permanently. Reliance on the grant funding cycle really prevents that certainty.
“Our loan funding has been designed to complement grant funding. It’s there to give people an opportunity to invest in new projects or facilities, and to establish or expand revenue-generating activities, which gives them their own income streams.”
Sporting Capital aims to invest in 30 projects by 2020 and has already worked with organisations using football, dance and fitness to engage with people not in education, employment or training (NEETs) and develop opportunities for them beyond their involvement in sport.
One investment accelerated the transformation of a council-owned golf course into an urban BMX and mountain biking facility in a deprived area of Leeds, opening up employment and volunteering opportunities in the local community as well as delivering a valuable facility for young people.
Jemma described some of the benefits that a Sporting Capital loan can bring to organisations that have previously been restricted to grant funding.
“We can be quite different in that we can support things like salary costs, rent payments, the up-front payments of moving to a new facility and equipment costs,” she explained.
“If an organisation is looking to develop, build or refurbish a facility then typically grant funders are interested in supporting the harder, capital costs. What has historically been harder to come by is support for other costs such as fit-out, kit and equipment and revenue support which are often vital to the long-term success of the facility. With Sporting Capital we can do that.
“Ultimately our funding is flexible; the only thing we really can’t fund is the ‘bricks and mortar’ capital elements.”
Sporting Capital (who are Alliance of Sport members) works closely with organisations to help them transition from grant funding to repayable investment, which can range from £50,000 to £150,000.
The fund does not take security against any assets or ask for personal guarantees, and there is the potential for up to a two-year capital repayment holiday to give organisations the chance to get new developments up and running.
“Sometimes it can be a challenge for potential applicants because they’re very used to the grant funding process,” added Jemma. “But what we’re finding is that the sector is getting there; it is moving along.
“We recognise that it’s a new thing for a lot of these organisations, so it’s not just a case of us saying ‘apply and we’ll say yes or no’ – it’s about building relationships with them that continue throughout the loan.
“We work with them to make sure things are going as they expected, so that if things do change its not a shock to us or them. It’s very much a case of working hand-in-hand with them to make sure it works for both parties.”
The organisation welcomes enquiries from organisations that want to work in the social impact space but aren’t necessarily set up that way, as well as those who are not incorporated organisations and private organisations seeking to develop a social mission.
As Jemma explained, the appetite to develop a business model with wider social impact is key. “We wouldn’t want to rule anybody out. We welcome them to have a chat with us to understand what they’re looking to do in terms of broadening their offer and the income generation they would be looking at.
“If we think they would benefit from additional support, they may be able to obtain the grant funds to do that. This helps to develop their own capability and capacity, making them more readily able to take on investment.”
For more information about Sporting Capital, visit their website: www.sportingcapital.org.uk