Social investment, unlike grants or donations, is when charitable organisations such as social enterprises receive a loan which they later repay. Loans are used in a variety of ways, from buying equipment to renting property, to expanding or replicating the business in some way.
In 2011, Community Interest Company ‘10,000 Hours’ became close to converting St Mirren FC into the first community owned SPFL Premiership club.
Although the deal didn’t go through, this case study is an interesting example of how third sector organisations and football clubs can rethink their positions and use football and community owned football as a vehicle for community development, unlocking social investment finance along the way.
The decision to sell the club to a social enterprise came about because the owners of the majority shareholding in the club had decided to sell, but they were interested in making sure it remained sustainable and debt-free.
The founder of 10,000 Hours, Richard Atkinson said he became aware the club was for sale and approached the board with the idea of a CIC.
“I gave them a presentation and they said they quite liked it,” he said. “They were particularly keen on the asset lock that a CIC provides.”
The group had approached several specialist social lenders for finance that could be used to buy the club and had had some promises of funding, he said.
“We’ll repay that money with membership fees and the new social enterprises we will start within the ground,” he said. “There’s a lot of under-exploited space in the stadium that we can use to generate revenue.”
If the deal had gone ahead, said Atkinson, St Mirren would have be the first top-flight football team in the UK to be owned by a social enterprise.
“This project has shown that the community is emphatically interested and can create a project on this scale,” said Atkinson.
He said that many community organisations, including churches, sports clubs and local and national charities, were interested in using the facilities at the ground.