Why it’s Cool2Care
By Modwenna Rees-Mogg, AngelNews
For 20 years until 2007 Phil Conway was your classic mainstream businessman at IBM, building a career in sales and marketing helping to drive IBM’s growth in the Asia Pacific region. One of his great achievements was building up the market there, marketing and selling IBM’s corporate software products and services.
From IBM to Social Entrepreneur
His life changing moment was driven by the birth and early life of his disabled son Shaun. Shaun, now aged 13 years, has a very rare disorder that affects one in a million children, and results in severe physical and learning disabilities. The experience of coming to terms with this life-changing event drove Phil to become a trustee of Contact a Family, a charity which supported the families with disabled children in the UK.
“It helped me to make sense of my own experiences”, he told me. But it also rapidly showed him the gaps in the support market for disabled children and their families. With only 1 in 13 disabled children receiving support from their local authority, it was clear that there was a large need for a new offer for the majority of the market. After years in corporate life, Phil was not ashamed to admit that he wanted to make the world a better place; he now saw a way to do it, but with a bit of a difference and in a way that he could put his own mainstream corporate skills to work.
Let’s help them “do what other kids do”
So four years ago he decided that setting up a social enterprise with all the values and approaches that would encompass it, rather than a charity, was the way to go. The purpose of the enterprise would be to offer high levels of value added support to disabled children and their families to enable the children to “do what other kids do” as well as offering all the practical support in the home necessary to make sure that everyone involved had the highest possible quality of daily life. The market was big; in theory it needed his offer and there was no real competition. Also if he could prove the value it would be likely that people, especially those mandated to support disabled children (i.e. local authorities), would be willing to pay for the services on offer; so why not go for it?!
CIC – the right legal structure for Phil’s enterprise
The big advantage of taking a social enterprise route would be that it would be intrinsically “business-like”. Phil set up Cool2Care was in August 2007 as a CIC, a community interest company – it could receive investment, borrow, make profits and pay dividends, but the added value was that it also had to deliver social impact. Like any novice entrepreneur, Phil wrote his business plan and then set up a couple of pilot programmes to prove his model. He deliberately set them up in Surrey and Birmingham “because Surrey is where I live and (more importantly) was semi-affluent and semi-rural, Birmingham on the other hand was deeply urban & ethnically diverse – it could not have been more different. If the pilots worked in both places I knew I could scale across the country.”
Mountain marathons climbed and won
He funded it by raising money from friends and family and using his own resources – including raising some money by running a mountain marathon himself! And he successfully approached UnLtd for a Level 1 award which gave him £5,000, but more importantly lots of advice and contacts. Despite the social nomenclature, at this stage Phil was clearly behaving just like any talented entrepreneur on a mission to succeed.
The core service at Cool2Care quickly matured into a service where it helps families find trusted support for one-to-one care in and outside the home, but always at a domestic level. It focused on recruiting and training top quality individuals to provide the care and then matching them exactly with the needs of disabled children and their families. It was, and is, going to remain a high value added service, not just a connector for two pools of people who need each other.
Cool2Care is not about just washing and feeding. It’s about getting disabled children into the community and building normal relationships, especially with other children; with a fair wind, these relationships will last a lifetime. So carers also do the fun stuff – taking the children to Cubs or Brownies and as they get older perhaps just taking them to hang out in the local town. Of course there is much more to it than that, but for the children it’s these bits that make all the difference.
12 happy customers in Surrey and Birmingham
The pilots generated 6 happy customers in Surrey and a further 6 in Birmingham. This was the green light that Phil needed. So he approached UnLtd for a £20k Level 2 award to scale up into 20 areas. Others followed UnLtd with further social investment to help him on his way, and perhaps even more importantly local authorities started to take an interest and to give contracts to Cool2Care to provide services in their districts.
A rapid scaling followed as the enterprise rolled out across the UK – from Lincolnshire to Essex and beyond. A small HQ, including finance and HR was also set up to co-ordinate everything and keep standards consistent. Thanks to the business model that Phil had initiated everyone was salaried. Within a couple of years there were 50 staff spread around the country. Today in just over 1,500 days it has turnover of £1.2m per annum, is helping hundreds of children and can only see more growth to come.
Phil knows that Cool2Care is not just about the UK – through the sister charity he has set up – the Cool2Care Foundation, he is already building links internationally with NGOs and charities who might, in time, help him to roll out further afield – “with my background building out IBM in Asia Pacific, I would be stupid not to take this as far as I can,” he told me. So there is clearly a bigger plan underpinning the day to day scaling. Phil is also already acting as a showcase for other less developed social enterprises. Just the other day he was explaining to the Big Venture Challenge winners, who are just a couple of years behind him in development terms, how to get from where they are now to where they want to be in two years time.
Making money and able to offer financial returns on investment
As with any CIC it is driven just as much by social returns as by financial ones, but the business model does mean that it has money and is generating more. This means it makes an attractive proposition for social investors and angels as it can pay interest on and redeem its loans, and take investment in the form of redeemable preference shares, which can pay dividends until redemption. With a cash generative model, highly regarded social debt financiers such as Venturesome and Big Issue Invest have already passed their eyes over it and have given it debt funding on social market terms. Cool2Care is not expecting to have any trouble in financing these loans or repaying them as agreed.
But Phil also wants to build the equity base of Cool2Care. He is on the hunt for a handful of angels who can fund a social equity investment of around £100,000. He is offering them a stake in a business where he currently holds all the shares himself and which is looking to double revenues and quadruple the number of children it supports within five years. There will be dividends on offer and the opportunity to redeem the shares in an agreed time plan.
So who is going to invest in Cool2Care?
Well I think there will be a lot of people – in fact, I interrupted the interview to email one angel I knew whose fancy it might take and await the result of the introduction. The sorts of people who will like Phil and what he is doing will be those who understand rapid scaling of a model that works, who like clear sighted management who are “businessmen” and a well driven business. They will also be people who appreciate that a lot of the hard work in investment terms has already been done thanks to the underpinning of support that UnLtd gave to get the business set up right in the first place and to the due diligence completed by Venturesome and Big Issue Invest. I wonder if I will be right. Watch this space!
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