How a £1m investment created dozens of jobs, attracted £10.5m extra funding and transformed communities

Community businesses in the Liverpool City Region are bucking the national high street trend and creating dozens of new local jobs after receiving funding from Mayor Steve Rotheram and the Combined Authority (CA).

Mayor Rotheram has hailed the transformative effect of his Kindred programme as new figures show that its first £1m of investments generated 77 new jobs and attracted £10.5m of additional funding.

Backed by £5.5m from the CA and £1m from Power to Change, Kindred was established to support socially trading organisations (STOs) that set out to deliver benefits to the areas in which they operate.

Kirsten Little – Make Hamilton

Steve Rotheram, Mayor of the Liverpool City Region, said:

“Socially trading businesses play a unique and vital role in the local communities they operate in and I’m incredibly proud that our area is a powerhouse of principled, community-focused business. Their positive impact can be felt right across the region, accounting for nearly 10% of all jobs and add a whopping £3bn to our local economy.

“The very essence of devolution is taking power away from the centre; I didn’t want to wrestle decision making away from Whitehall only to hoard it in my offices. That is what Kindred is all about: working with community businesses to design and develop a programme that would help them deliver on their potential.

“Owned and managed by the sector, it’s already making good on our investment by creating good, local jobs and attracting nearly ten times its funding into the area. It has made a fantastic start and I’m sure will only go from strength to strength, which will only continue to benefit local people and communities.”

Kindred invested its first £1m in 20 STOs, also known as community businesses, across the city region in spring 2021.

The evaluation found that, collectively, the 20 STOs nearly doubled their number of employees from 81 to 158.

Their combined turnover also doubled from £1.88m to £3.76m and they attracted a further £10.5m of additional investment.

Investment in five STOs in Birkenhead created a cluster effect that is helping transform the town.

The socially-trading sector employs 50,000 people, one in 10 of the city region’s workforce, with 1,300 STOs generating £2.9bn per year for the city region economy.

Birkenhead has become an outstanding example of the impact of socially trading organisations, with a cluster of community businesses helping to transform the town.

STOs in Birkenhead were awarded £12,000 in development awards in a pre-Kindred pilot in 2017. Four years later, in spring 2021, five Birkenhead-based STOs – Make Hamilton, Future Yard, Open Door Centre, Hype Merseyside, and Grow Wellbeing – collectively received 20% of Kindred’s first round investment, around £200,000.

Those five STOs have since created 50 new jobs in the town, increased their turnover by £1.3m and attracted £9.4m in additional funds.

 Their impact, alongside other Birkenhead-based STOs, has created a cluster effect that helps support the small business ecosystem, improves people’s lives and helps create a vibrant sense of place. Clustering sees other businesses attracted to an area by the growing activity there. For instance, in Birkenhead, a bakery and pottery have moved to the area. The impact of the cluster effect is exponential.

Cllr Janette Williamson, Liverpool City Region Combined Authority Portfolio Holder for Inclusive Economy and the Third Sector, and Leader of Wirral Council, said:

“The socially-trading sector plays a vital role in our economy and is something that we are rightly proud of as a city region.  That’s why we were so keen to back the creation of Kindred and why it is so heartening to see this evaluation of their first investment.  The figures spell out just how productive the investment has been, in terms of creating jobs and attracting investment into our communities.  And the impact on Birkenhead shows how creating a cluster of social businesses multiplies the impact of any support, reviving the entire area.”

Jennifer Van Der Merwe, Kindred’s director, says:

“If this growth continues, Birkenhead is on the verge of becoming a high-growth cluster. But it’s growth that creates social good – not just profit. Much of the funding these STOs have attracted since their Kindred investment is from the Towns Deal, which shows that national government has noticed the emerging potential of social businesses in Birkenhead. It is also now investing in this entrepreneur-led high growth cluster of socially-trading organisations.”