Consider establishing a company limited by shares or a limited liability partnership.
It sounds like this is primarily a commercial venture, although it may have a social purpose.
Company Limited by Shares
To establish a company limited by shares, you need to incorporate the company at Companies House.
What next? Get in touch with TrustLaw if you need advice.
Case Study: Company Limited By Shares
Talentino was founded by UnLtd Award Winner, Jenny Connick. It is a young, dynamic, award winning, career development company based in Reading and working across England. Talentino offers two career development programmes and trains people from schools, Special Schools, housing associations, local authorities, children’s homes and businesses to deliver these programmes.
Talentino was established as a CLS because Jenny wanted to reflect the entrepreneurial, business-like approach they were taking to the career development programmes, which she felt were often lacking in innovation and professionalism. The model suited them well, because while it was important to express Talentino’s social values – which they achieved by embedding the social mission in Talentino’s constitution – they did not want to deny their objective to also be successful commercially.
Jenny acknowledges that, for certain funding streams, such as grants, it is a disadvantage to be a CLS, but this depends on where a venture’s income is going to come from, and the specific marketplace it operates in. Talentino generates most of its income through sales and a small proportion from grant funding. Investment funding has come in three forms, revenue participation, debt financing and granting exclusive licensing in exchange for the development, marketing and ongoing maintenance of a new online product.
In addition, Jenny has created a registered charity and granted a free license to it for Talentino’s products. It is still early days but the purpose of the charity is to provide extended career coaching and personal development support that would not be funded commercially.
Now that you have an overview of what structures may be most suitable for your social venture, you should seek legal advice to ensure the structure meets all your organisation’s needs.
TrustLaw, the Thomson Reuters Foundation global pro bono legal programme, connects social enterprises with leading law firms to provide free legal assistance on issues such as a structuring. In the UK alone, TrustLaw supports over 250 social enterprises with free legal assistance.
Apply to join TrustLaw to request free legal advice for your social venture.