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BAME social entrepreneurs are booming but struggle for funding

New research shows people from a BAME background are more than twice as likely to start a social enterprise than white people.

People from Black, Asian or minority ethnic backgrounds in the UK are more than twice as likely to think about starting a social enterprise than white people, according to new research.

People who identified themselves as BAME were also more likely to follow through on their ideas, according to the polling by UnLtd, a foundation for social entrepreneurs. They are less able to get access to funding and training, however.

“UK entrepreneurs from Black, Asian or minority ethnic backgrounds are less likely to access finance, less likely to make a profit, and businesses face worse outcomes despite similar success rates in starting up a business to their white counterparts,” said Mark Norbury, chief executive of UnLtd. 

“We want to see an inclusive recovery in which social impact and economic growth work hand in hand. We need continued investment in the sector to help social businesses reach their potential, and that must extend to all social entrepreneurs, no matter their background.”

The research showed nearly a quarter of BAME respondents said they had thought about starting a “social venture that generates income and has a social and/or environmental benefit”, and two thirds had followed through on their plan.

​​Over a third of those polled (37 per cent) said personal finances were a barrier to starting up and growing a social enterprise, with access to funding and investment a close second (34 per cent).

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UnLtd and Big Issue Invest Fund Management are calling for the creation of a £25m growth impact fund for “historically underfunded” entrepreneurs, including non-financial support to help all social entrepreneurs become ready to scale and take on investment. 

Danyal Sattar, chief executive of Big Issue Invest, said: “Our United Kingdom is a place where entrepreneurs have a chance to shine, and that should be regardless of race, colour or creed.  We just need to make sure they have the finance to back their enterprises. They don’t need levelling up – finance them, and they will rise.”

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