Effervescent are a social enterprise and registered charity based in Devon. They passionately believe that children and young people have the insight, intelligence and imagination to make the world a better place. With backgrounds in child counselling, youth work, art and advertising, Effervescent have developed a unique methodology for co-producing creative campaigns with vulnerable children and young people. Their approach not only transforms the lives of those involved directly, but also produces exhibitions and communications campaigns that touch the lives of children and young people everywhere.
Challenge
Since inception, Effervescent have delivered thousands of hours of intensive creative work with hundreds of vulnerable children and young people across the UK, creating profound change in their lives. 100% of these children and young people report that they are happier, healthier and feel more socially connected as a direct result of their work. The organisation wanted to become less reliant on grant funding and to develop a sustainable business model, meaning they can reach more young people and move away from project-to-project fundraising.
Solution
Arts Impact Fund structured the £150,000 investment in two parts; £100,000 was a standard loan agreement with a fixed interest rate and £50,000 was a Revenue Participation Agreement that entitles the lender to received a share of the gross income at a set percentage over the term of the loan.
Revenue model
The organisation is in the process of transforming its business model to enable it to generate more revenue by commercialising its existing IP and creating further campaigns with young people that can help save clients money (such as local authorities) or support public services (such as the NHS).
Impact
This investment will enable Effervescent to underpin their growth strategy with a team of sales and marketing personnel, customer management systems, marketing collateral and a brand refresh to reflect the products and services they offer. With greater earned income the organisation can shift away from its historic reactive and grant-funded programme model to a more strategic one; creating more chances for traumatised children and young people to heal, make a positive social impact in their communities and go on to form part of the creative workforce.