An investment package program for indigenous entrepreneurs creating social enterprises has this week been launched by not-for profit group Reconciliation Australia, government body Indigenous Business Australia and social enterprise consulting group Social Ventures Australia.
The two-year pilot program is designed to create a pipeline for future investment. The packages will be tailored to each group’s needs and could include grant funding and concessional business loans.
In a statement, IBA chief executive Chris Fry says the initiative was launched to increase entrepreneurial activity and support among indigenous Australians.
“The ISEF will allow indigenous social enterprises to grow and become more sustainable with strategic investment in capacity and potential,” Fry says. “It will also build a strong pipeline of investment-ready indigenous led enterprises that have the potential to create employment and change lives in indigenous communities.”
Indigenous Business Australia (IBA) has allocated $1 million in funding over two years, which will be managed by Social Ventures Australia.
There is no cap on the number of entrepreneurs, but IBA expects five to 10 start-ups will take part.
Reconciliation Australia’s chief executive Leah Armstrong told StartupSmart social entrepreneurship was common in Aboriginal and Torres Strait Islander communities, but it wasn’t often called that.
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“These kinds of activities are common, but it wouldn’t be termed social enterprise or entrepreneurialism,” Armstrong says.
“I’m excited this is about thinking about new investment models that are beyond your normal financial loans. Where we’re going to have success in the long run is if we can create a new generation of indigenous social entrepreneurs to close the gaps in their communities.”
Armstrong adds while they don’t have a lot of money behind the pilot program, the cash grant and pro-bono mentoring offer should be powerful for the selected companies, and wider community.
“The challenge for us is about encouraging entrepreneurial thinking and capacity building. There are a growing cohort of Aboriginal and Torres Strait Islander entrepreneurs who are running their own business, but in the community sector we need to keep building the capacity and changing the mindset around social entrepreneurship. But the non-Aboriginal community sector has that challenge too,” Armstrong says.
Eligible start-ups will need to be owned by indigenous Australians, be not-for-profit initiatives, financially self-sustaining and have a qualified board of management.