Key Fund named as winner of the Economic Impact category (for large providers) in 2016 Citi Microentrepreneurship Awards
Think the “banks won’t lend” and Yorkshire folk are tight? A Sheffield-based lender dispels those myths by providing responsible finance, and this week won a national Award – and £15,000 – in recognition of their impact.
Don’t we just love stereotypes and caricatures? “Yorkshire folk are tight. Banks don’t lend. Credit-worthy businesses can’t access the finance they need.”
Whether fact or fiction, stereotypes have a tendency to become myths – and many small businesses’ and social enterprises’ experience of being turned down for the finance they need to grow means they certainly believe that “banks won’t lend.”
But a Sheffield responsible finance provider is dispelling myths: investing in and supporting organisations turned down for finance by mainstream banks and helping to create dramatic numbers of jobs.
And this week it scooped a national award for the “significant economic impact” it has made – recognising its positive contribution to the economy.
Key Fund Investments Ltd, a social enterprise that only makes loans to enterprises that have been turned down by a mainstream finance provider, lent over £6.5m last year to 126 organisations.
Yet despite doing deals that commercial providers won’t, their default rate among investees was only 4.09 per cent last year – a rate vastly below the double figures experienced by many commercial lenders.
Evidence, according to chief executive Matt Smith, of their “expertise and success in navigating the stringent conditions the sector operates in.”
Judges in the 2016 Citi Microentrepreneurship Awards organised by the Citi Foundation in partnership with Responsible Finance agreed. This week Key Fund won an award for its Economic Impact against strong competition from all over the UK.
And Matt added, “it’s a great honour and a testament to the hard work of the team. The reality is, we’re an enabler of economic impact and it’s really heartening to see the broad range of impacts of our clients. I’m really proud of the team’s hard work in helping to achieve this.”
Doncaster Refurnish is a good example of a Key Fund client. A beacon of social enterprise with £1m turnover, 43 staff and 40 volunteer, it’s still growing.
One of Key Fund’s longest-standing clients, Refurnish – which collects, restores and sells furniture to low-income families – has used finance packages from Key Fund to support business growth.
Last year Refurnish made 13,785 collections of bulky household waste, diverted 817 tonnes from landfill and supported 8,488 individuals and families and 24 community groups with the proceeds. Refurnish’s chief executive, Andy Simpson, says:
“There are lots of funding institutions out there that talk a good story and shine in the eyes of the powers that be, but none deliver like Key Fund. They truly understand our sector, they live and breathe it, they believe in what we strive to achieve. When you deal with them they listen with their hearts as well as their ears, Key Fund is entrepreneurial in its own practice and we as customers are the ultimate beneficiaries.”
Other projects within Key Fund’s ambitious strategy to “not only invest, but to grow the social economy” include a unique partnership with Traction Central and The RSA funded by Cabinet Office via the Big Lottery Fund to create DotForge Impact Accelerator – developing revolutionary tech-driven companies that deliver positive social change.
“Think Silicon Valley, not just for profit but to deliver real impact,” according to Matt Smith.
2015 saw Key Fund celebrate its 15th anniversary; doubling its trading income and investments; creating 29 new enterprises and 166 jobs and safeguarding 247 more; and generating £24million from its investments into local communities – an £8 return on every £1 invested.
With clients working in sectors including environment and recycling, health and social care, and community services, Key Fund’s loans help clients to deliver an economic and social impact in their local communities, providing much needed services and regenerating deprived areas.
And as Key Fund widens its geographical reach across the Midlands and the North of England, and forges new partnerships for growth, it’s set to help even more new enterprises and innovations with the finance they need to scale – and successfully tackle social problems in a financially sustainable way.
You could describe it as a dose of good old-fashioned Yorkshire common sense.
Key Fund’s chief executive, Matt Smith, was interviewed by Jamie Veitch at the Responsible Finance 16 conference. Listen to the interview here:
Responsible Finance have partnerned with the Citi Foundation to bring the global Citi Microentrepreneurship Awards to the UK for the third year. The awards celebrate the economic and social impact of responsible finance providers on the people and places of Britain, and champion the outstanding microentrepreneurs who are creating jobs, services and prosperity in their communities.
This year the prize fund has increased to £65,000 and the Award Winners were announced on the evening of 8th March 2016. More about the Citi Microentrepreneurship Awards and this year’s winners.