Uday Thakkar: Setting up a social enterprise

Uday Thakkar, MD of consultancy Red Ochre, on why he abandoned a successful corporate career to set up a social enterprise.

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Transcript

Uday Thakkar, the Managing Director of Red Ochre, won the Social Enterprise Mentor of the Year award in 2008. Uday had a successful career in the corporate world and is now passionate about working with groups in the third sector and enabling them to realise their potential through training and consultancy.

Is running a social enterprise different from a ‘normal’ business?

There are differences. I can best compare it with the sort of work I used to do prior to being involved in this sector where I was working as a commercial consultant, in a small SME consultancy. There it was a bit of a scatter-gun approach. The SME market is enormous and it was very difficult, unless… I didn’t have any particular specialization. There are a lot of people that only deal with manufacturing or media or whatever. With the SME market it’s a little bit of everything and actually gaining traction with organisations was actually quite difficult and actually finding people prepared to pay was very difficult as well. Within the sector we’re now operating in it’s much easier because it’s a much more defined market even though it’s quite fragmented within that market and there are lots of different players out there. But it’s…we are finding that we’re a little bit of a big fish in a smallish pond, where once you build up a reputation and actually people have heard about you and it’s much, much easier going out and actually convincing people to engage with you. What is similar is the funding issue – actually getting people who can pay for you is quite difficult. Again given the business model we have, that we have some very large clients, they can afford our fees. We have some very small clients who can’t and then some of that we work with some of the organisations that we work with on a pro bono basis anyway. But what we have found increasingly is that the organisations that do want to work with us do manage to go out and find funding in some form or another and there are quite a lot of government-led initiatives where there is funding for the smaller community groups and voluntary associations to actually get help from people like us, so we do actually manage to get paid for the work we do. But that remains one of the hardest things to get and, I guess, the impact on us is that we’re constantly struggling to get more work in just to keep the cash flow coming in, especially as quite a lot of… we’re not building up the profitability to line our own pocket, it really just goes back into delivering a better service to the people we work with.

How can smaller social enterprises compete with larger companies?

It isn’t the size, I guess it is really is, it’s not the size that matters it’s the quality, it is the experience and what we bring to bear and I think certainly the feedback we get from all the people that engage with us is that there is an element of, well there is honesty and down-to-earth-ness about us but also a little bit of flippancy, well I wouldn’t say flippancy is the wrong answer, there’s a certain sense of humour that runs through Red Ochre – we don’t take ourselves too seriously and I think that works in our favour. We’re not one of these big organisations that feel terribly affronted if people say funny things about us, we say funny things about ourselves first. So, I come back to this, it isn’t the size it is the quality of what we do, how we deliver it and the people we work with. There are only six of us. We get asked to do a lot of training. We’re very, very careful not to involve people outside the organisation to deliver some of the training or even the consultancy unless we’re really familiar with them and we feel totally confident that they can keep up that ethos and quality that Red Ochre offers. So we’ve got a very tight team and a very small number of associates that we might use and we are consistent in our delivery and the feedback we get from our clients is fantastic, which is why we’re growing and, despite the credit crunch, we’re overwhelmed with work at the moment.

Is the social enterprise business model becoming more popular?

Absolutely, not just social enterprise. Increasingly, a lot of young people may not actually even heard of social enterprise, but whereas maybe ten, fifteen years ago I used to get a lot of young people coming to me and saying I want to set up a business. We went through this in the dotcom bubble days – I want to set up a website that’s going to make me millions of pounds. People are now coming to me saying I want to set up a business, I wanna make some money but I want it to be ethical and they’ll come to me and talk about ethical business and the values are not that different from social enterprise. And what they want to do is they want to enjoy what they’re doing, they want to make sure they don’t actually have an environmental impact as far as possible, they want to make sure if they are buying things from abroad that it’s at fair trade prices and things are ethically sourced, and this is a big change. I’ve been talking, I’ve been doing presentations at universities recently and again big numbers of people are turning up. A couple of weeks ago I was at the University of the Arts. I was asked to give a presentation on what social enterprise is and what it can do for you and they were completely overwhelmed. They were expecting about 20 or 30 people to turn up – 150 people turned up. These people were all people either coming up to graduation or just graduated and it was an enormous response and now it’s gone down so well that they’ve asked me come back and do a regular number of presentations on social enterprise round the constituent colleges there. But it just shows a sea change that young people are really, really concerned about the planet – they’re concerned about doing good, they’re concerned about greed and all the things that have been going on, and this has been ongoing for quite some time.

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