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A Technical Guide to Financing New Employee Mutuals

Published: 
14 May 2012

Public service mutuals represent a significant and very exciting opportunity for improving public service delivery. Usually structured as social enterprises that adhere to the values of employee-ownership, mutuals have a unique potential to combine the social ethos of public services with an organisational structure that enables them to embrace social challenges in more flexible and entrepreneurial ways.

However, should mutuals fail to adjust quickly to the new commercial environment which they face once they have ‘spun-out’ of the public sector, they may find that they lose contracts to public or private sector competitors – competitors who are often able to fund new developments or absorb losses for the sake of building market share. Spinning out of the public sector with few assets, external funding is therefore vital for most mutuals that are seeking to consolidate their role and develop their services.

Written by Ben Jupp, Dan Gregory and Ben Williams, this paper highlights the nature of the opportunities and challenges mutuals will face in securing the investment they require, regardless of their size or the stage of spinning-out at which they are at.

 

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