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Building a Social Enterprise

Building a Social Enterprise. Future of Local Government National Summit 23 May 2013. Mark McKenzie- McHarg Director, Mach 2 Consulting. Building a Social Enterprise. Social Enterprise v. Community Enterprise. “... an overriding social purpose or goal

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Building a Social Enterprise

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  1. Building a Social Enterprise Future of Local Government National Summit 23 May 2013 Mark McKenzie-McHarg Director, Mach 2 Consulting

  2. Building a Social Enterprise ... Social Enterprise v. Community Enterprise “... an overriding social purpose or goal “...operates on business principles.” “... focused on betterment or advancement of a community”.

  3. This is the story of ….

  4. .. and No Money! … and so was born… … a public company with … 7 shareholders … a big idea …&

  5. 1 The 2003 Public Share Offer…

  6. The key… We will contribute 50% of the distributed profits to projects, causes or initiatives which will … “… benefit the economic, social, or cultural condition of the Yackandandah community or its surrounding areas.”(clause 27.2)

  7. Let’s Invest in Yack’s Future … BUY A ‘SHARE’ IN YACKANDANDAH This is not just about petrol … The YCDCo. Ltd. Public Share Offer is coming soon… YCDCo. Ltd., 37 High Street, Yackandandah, 3749. Ph: (02) 6027 0777/6027 1385 ACN: 099 899 886

  8. What do YOU want Yack to look like in 15 years? Buy some Shares In Yack! … lets really Take OWNERSHIP!

  9. What do YOU want Yack to look like in 15 years? Banks Council PETROL STATION Butcher Shop? Grocery Store? Newsagency? Hospital? Pharmacy? Motor Mechanic? Hardware Shop? Gone Gone ??? Where will YOUDraw the line on Rural Decline

  10. Buying Shares in YCDCo. Ltd. Is NOT just about petrol! YOUDRAW THE LINE! Please support the YCDCo. Ltd. Public Share Offer

  11. “… if we leave it up to the good gents & ladies in the Board Rooms of Coles & Woolies to decide what’s best for Yack, THIS is what will happen! We’ll all buy our fuel at Safeway because it’s SO CHEAP! And, we’ll buy our meat, groceries & grog there too. And, being such nice guys, before too long, they’ll give us a daily newspaper … for FREE!” But … What will the main street of Yack look like &… Will we really be better off?

  12. The we built it:

  13. Today… now… Local expertise - called in lots of favours

  14. …our shareholders …

  15. …our shareholders …

  16. Trading… 43,000 lpw 50,000 40,000 Fuel Sales Litres p.w. 30,000 20,000 11,000 lpw 10,000 03 04 05 06 07 08 09 10 11 12

  17. Non-Fuel… $10,000 Weekly NF Sales $9,500 $ Sales p.w. Hardware Shop Acq. $5,000 $2,000 03 04 05 06 07 08 09 10 11 12

  18. 2012 Results … Operating: Balance Sheet: Outcomes: Gross Sales: $3.1 mil. Underlying Earnings (Cash) $44,000 Profit (before tax) $18,000 Profit After tax $12,000 NET ASSETS $453,000 Share Value ($100 issue) $107.15 3 local jobs Flow-on local investments A strong, township-focused entity with independent economic resource capacity

  19. Challenges since 2003… The pharmacy, the hardware shop, the motor mechanics, … Short memories – “Use it or lose it” … It’s a business Managing changing community expectations … Governance , succession, regeneration … “Don’t try to be all things to all people.”

  20. Lessons… A real ‘Enterprise’ - scale Structure – equity, ownership and capital The Constitution – enshrine the underlying community goal (as a future reference point) Governance – skills-based Board Do it properly - do a proper Business Plan Get community ownership and ‘buy-in’ (literally and metaphorically) Leaders, champions, advocates and allies Challenges for Local Government...... Where do you fit?

  21. Mark McKenzie-McHarg Mach 2 Consulting (02) 6027 0777

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