13 April, 2015
Setting the benchmark: £3.36 value for every £1 invested in Outset
Outset, the award-winning start-up support service, delivers a return of £3.36 of social, economic and financial value for every £1 invested, according to a recent independent evaluation by NEF Consulting, leading experts in the field of impact assessment. This equates to over £38.5 million of value delivered across the South West in the last five years.
The evaluation is the first of its kind for start-up support services like Outset, and thus establishes a high benchmark against which funding bodies – in both the public and private sector – can assess their investment in future support services, in line with local economic development strategies.
Indeed, this outstanding return on investment is welcome news for the Outset service, which was created by YTKO Group as a not-for-profit social enterprise and is currently funded in the South West through a combination of European Regional Development Funds (ERDF) and local authority investment. With tendering for the next round of European funding currently underway, this result allows Outset to demonstrate the total impact it makes on the communities it supports – an increasingly important requirement for all publicly funded projects.
The evaluation employed a Social Return on Investment (SROI) methodology, an approach that values all impacts made by a programme, including those that are often considered intangible or hard to measure, like client wellbeing and quality of life. Graham Randles, Managing Director of NEF Consulting says: “We deliberately took a conservative approach to compiling our analysis. The true value of the Outset service is therefore likely to be significantly larger than we are able to credibly measure, predict and value within this evaluation. Evidence of impact and value for money should therefore be interpreted as the minimum contribution Outset provides to clients, the State and the wider economy.”
Overall, the evaluation reported that Outset’s greatest contribution to the State is delivered by supporting people out of unemployment and into self-employment, realised through decreases in benefits claimed and increases in tax generated. 65% of clients were unemployed prior to engaging with Outset, including 19% who were classified as long-term unemployed. Of this total client group, 49% successfully entered self-employment following engagement with Outset, compared to only 11% for the national baseline. Additionally, 14% of these clients went on to secure employment, reflecting Outset’s focus on helping clients develop valuable transferrable skills and knowledge, even if self-employment isn’t right for them.
Value delivered to clients was measured through changes in clients’ emotional and financial wellbeing from their early stages of engagement with Outset through to 2.5 years after receiving support. The evaluation reported measurable increases in clients’ self-esteem and self-belief, which grew as they recognised new capabilities within themselves and the ability to change their lives for the better. Clients also attributed an increased sense of meaning, purpose and belonging and a greater feeling of autonomy and freedom to the support they received from Outset.
In addition, regardless of whether or not they ended up entering self-employment, all clients reported the development of essential transferrable knowledge and skills. This included becoming more effective communicators, improving their organisation and time management abilities, and increasing their professionalism and presentation skills. Overall clients reported feeling better off financially, and experiencing significant income increases as a result of the support they received.
These factors reflect Outset’s unique approach to ‘growing the person as well as the business’ and its expertise in working with clients from deprived wards, disadvantaged backgrounds or unrepresented segments to support social and economic inclusion goals. In addition to the unemployed clients already mentioned, the total client group analysed in the evaluation included:
- 51% women, compared with the national average of 19% for women led SMEs
- 18% clients from Black and Ethnic Minorities
- 15% clients with mental or physical health challenges, and
- 2% ex-offenders
Finally, the evaluation measured value to the wider economy through new job creation and gross value added by new businesses created with Outset’s support. It concluded that Outset can claim credit for over £22.6 million gross value added by businesses created to date, though this figure will continue to increase when tracked over a longer period of time.
Commenting on the result, Bev Hurley, C.B.E, Chief Executive of YTKO Group, says: “For the last five years, Outset has helped to transform the lives of thousands of individuals, whilst simultaneously strengthening and diversifying the local economies in which we operate. We know the value we deliver, but it is incredibly exciting to have a team of independent consultants reach the same conclusion, and we look forward to increasing this impact in the future.”
The evaluation focussed on six local Outset services operating in the South West between October 2009 and December 2014, including Bristol, Bournemouth, Cornwall, Plymouth, Swindon and Torbay. Across these services, a total of 5,998 clients received 12 hours or more support, from which 1,589 went on to start new businesses. This means that one business was created for every four clients that received 12 hours support, and an average of six new UK businesses were created every week. Of these businesses, 93% were still operating after one year, 85% after two years and 67% after three years, compared to the national average of 92% after one year, 74% after two years, and 58% after three years.
Since it was first established by YTKO Group in October 2009, Outset has engaged over 20,700 clients around the country, supporting the creation of over 4,170 new businesses and more than 4,600 new jobs.
If you’d like to view a copy of the evaluation highlights, please click here.
For more information, please contact:
Head of Marketing, YTKO Group
tel. 01223 903 916