FAQs

The social impact of my idea is UK-wide/global. Is this eligible? 

While there are no geographical restrictions on trading, Pounds for Purpose is funded by the Scottish Government, so the majority of the social impact must be delivered in Scotland. That means that the majority of people who will benefit from your good work must live in Scotland. We cannot fund ideas where the majority of the social impact is UK-wide or global. 

I am working as part of a team. Who puts in the application? 

Pounds for Purpose funds individuals, not teams. While we understand that many ideas have a wider team supporting them, the Pounds for Purpose award must be made to a named individual who will take responsibility for spending and reporting. 

My idea is part of a college/university project. Is this eligible? 

No. We cannot fund anyone applying on behalf of a pre-existing, established organisation like a college or university. 

I don’t have a personal bank account. Can I use someone else’s? 

No. The award must be paid into the personal bank account of the applicant. We cannot make the award to another person or company bank account. 

I am currently in Scotland on a student visa. Does this mean I’m ineligible? 

No. We would consider applications from individuals on student visas as long as they can provide evidence that they would be in the country for the length of the award (currently 6 months) or longer. Please bear in mind, however, that priority will be given to those applications that have the potential to develop into social enterprises. 

It will take longer than 6 months to spend the £500 Pounds for Purpose award. Is this eligible? 

No. We require that all Pounds for Purpose awards are spent and reported on within six months of the award being made. You should only apply if you are confident that you can spend and report on the award within that timeframe. 

I’m not sure my idea will become a social enterprise. Is it still eligible for Pounds for Purpose? 

Yes. At this stage, we are interested in the idea, not the outcome. That said, we will prioritise those ideas that have the potential to develop into a social enterprise. 

My enterprise will be trading across the whole of the UK. Is this eligible? 
There are no geographical restrictions on trading. However, as Start It is funded by the Scottish Government, the majority of the social impact must be delivered in Scotland. This means that the majority of people who will benefit from the good work of the enterprise must live in Scotland. 

I’ve run an income-generating pilot – does this count as trading? 
If you have already conducted brief activity to test the market for your idea, but are not regularly trading (e.g. you may have run a pop-up stall, or a trial workshop), then your idea is still likely to be eligible for Start It funding, and the results of this activity could in fact strengthen your application. However, if you have been regularly trading for some time, and this is ongoing at the point you apply, it is more likely that you have moved past the early stage that Start It funding supports. In this case, you should contact us for further advice on the other support we can offer for later stage enterprises. 

I’ve already set up as a sole trader/private company limited by shares. Am I ineligible for funding? 
Firstport funds individuals as opposed to organisations, so you can still apply whether or not you have set up a legal entity for your project, and regardless of the type of entity you have chosen. However, at assessment, we will want to know why you have chosen to go down a particular route, and whether you are committed to sticking with it.   

Setting up as a sole trader or private company limited by shares is more common in traditional commercial organisations as both of these models allow profits and assets to be paid out of the business to private individuals or bodies. A key feature of a social enterprise is that it does not allow this, and instead reinvests profits back into achieving its social aims. Even if it needs to close down, any remaining assets (after debts are paid) must be passed on to another social enterprise or charitable organisation – usually with similar aims. This feature is usually reflected in its choice of legal model. 

If it is important to you that your organisation can continue to distribute profits or assets, then your idea is unlikely to receive Start It funding and we would be more likely to point you towards support on setting up a standard commercial business. Firstport’s sister company, FirstImpact, may be able to provide support if this is the case. 

However, we are aware that many new social entrepreneurs initially register as sole traders or private companies limited by shares for other reasons – perhaps this is the model that seems easiest, or most familiar – or they want to claim their social enterprise name. If this is the case, but you are committed to setting up a social enterprise, we can help provide guidance on changing to a more appropriate model (and may even be able to fund costs associated with this if your application is successful). In such cases, an offer of funding might be conditional on you making this change. 

In any event, we would always strongly encourage applicants to base their choice of legal structure on what is best for the business, as opposed to being influenced by eligibility criteria for any particular funding stream – via Firstport or any other source. Please contact us if you would like further advice on this subject. 

My enterprise is a trading arm of an established charity/organisation. Is this eligible? 
No. At Start It, we focus on supporting individuals to start up new, independent projects, and who don’t have the backing of an existing parent organisation behind them. In cases where an idea has originated as a project of an existing organisation, but you want to develop this as an entirely new enterprise in its own right, we will want to see evidence that it is fully independent and separate from the original organisation. 

What is direct social impact? 
When a social enterprise carries out work or provides services itself for the good of its beneficiaries (this could be individuals, a community, or even the environment) we define this as ‘direct social impact’. On the other hand, when a social enterprise provides services to other organisations, who then go on to do the work with beneficiaries, this would be defined as ‘indirect social impact’. 

For example: an enterprise providing counselling services to a vulnerable group would be seen as direct social impact; an enterprise providing counselling training to a charity who then provides this counselling to their beneficiaries would be seen as indirect social impact. 

What type of enterprise typically requires premises to start trading? 
Most bricks-and-mortar retail enterprises, community cafés, or any community-focused enterprise which requires a permanent base of operations as part of their commercial/social strategy. 

I have identified a suitable property, but I haven’t approached the owner as yet. Does this count as an agreement in principle? 
No. You must be able to confirm that the property is available, and that the landlord/agency has agreed in principle to lease the property to you and provide us with details of any costs associated with leasing the property (deposit, rent etc.). 

I haven’t chosen a legal structure for the enterprise yet. Do I still need to put in legal/incorporation fees in the request? 
You don’t necessarily need to know which legal structure you want to go for at this stage, but there should still be an intention to incorporate at some point within the span of the award. It is up to you whether you seek professional advice to help you with this, and whether you want to apply for funding to cover this cost.  

I need to pay someone to design my website/branding – does this count as wages? 
No, unless you would be looking to contract that person as an employee. Paying someone to provide services to the enterprise – such as design – would be eligible. Paying someone to work for the enterprise and help deliver its services would not. 

I have already set up the social enterprise and all I need is equipment. Will this be eligible? 
Some social enterprises have already sourced start-up funds from elsewhere (which should be detailed in the ‘Other Sources’ space in the application form) but have a larger initial funding requirement. We will assess this on a case-by-case basis. 

If I submit a budget and need to change it at a later date, is that possible? 
We understand that requirements may change between the submission of the application and the assessment, so there will be opportunities to amend your budget later. 

What happens if my Start It application is unsuccessful? Is that it? 
No. Start It is an extremely competitive fund and we receive more applications than we can award. As such, sometimes otherwise great ideas may be unsuccessful because they require further development. In these cases, we would provide detailed feedback and, where possible, further business support with a view to reapplication once the feedback has been addressed. 

I have received Start It funding in the past for another idea. Can I apply for a new idea? 
No. Given the level of demand for Start It funding, we must prioritise new applicants and cannot fund previous awardees even if it’s a new idea. 

We are not officially incorporated yet. Can we still apply?

No. Build It is only open to incorporated social enterprises with a registered office in Scotland.

My enterprise will be trading across the whole of the UK. Is this allowed?

Yes. Your business can trade anywhere you want, but because Build It is funded by the Scottish Government, most people who benefit from the good work of your enterprise must live in Scotland.

What is direct, measurable social impact? 

When a social enterprise does work or provides services for the good of its beneficiaries, we call this ‘direct social impact’. When a social enterprise provides services to other organisations, who then go on to do work with their beneficiaries, we call this ‘indirect social impact’.

For example, an enterprise offering counselling services to a vulnerable group has direct social impact. An enterprise offering counselling training to a charity who then provides counselling to their beneficiaries has indirect social impact.

Our social enterprise has model Articles of Association. Is this allowed?

No. Model Articles of Association are standard default articles and do not include an asset lock. An asset lock protects the use of the company’s assets and prevents profits and assets from being distributed to private individuals and other companies.

We do not have a business bank account. Can the Build It grant be paid into a personal bank account?

No. Unlike Start It, Build It is paid to the enterprise. We need a business bank account in the name of the social enterprise.

I need funding for more than one salary. Can this be covered?

Build It can cover up to £27,000 for a single new post (including salary, pension, and tax) and a further £13,000 for an additional part-time post. It can also cover multiple salaries on a part-time basis if they adhere to the Real Living Wage. We do not cover sessional or casual staff.

I need funding to continue existing salaries. Is this allowed?

No. Build It covers new roles only.

If you are the founder and already drawing a salary from the enterprise, you cannot use Build It funding to continue funding your current role. However, if you want to move to a different role (for example, to stop delivering services so you can work on growing the business), then you can apply for your salary, but please explain this clearly in your application.

Our enterprise is still relatively new. How much evidence of income generation and social impact is required?

Because Build It is for tried and tested business models, we would usually expect to see a track record of at least a year, especially if the enterprise has a seasonal business model.

I already have a detailed cashflow projection that I would like to submit as part of my application. Can I do this? 

No. You must use the template provided and submit as an Excel spreadsheet. 

What’s the difference between an Executive Summary and a Pitch Document? 

An Executive Summary is usually the first-page summary of a business plan and therefore relates to information contained in that business plan. Your Pitch Document should be a summary of the application as a whole and be understandable to a reader who will not have access to your application form, business plan, or cashflow projection. 

My enterprise will be trading across the whole of the UK.  Is this eligible?

There are no geographical restrictions on trading.  However, as the Social Innovation Challenge is funded by the Scottish Government, the majority of the social impact must be delivered in Scotland.  This means that the majority of people who will benefit from the good work of the enterprise must live in Scotland.

I need funding for more than one salary. Can this be covered?

The Social Innovation Challenge grant can be spent on salary costs to allow one or more individuals to dedicate time to developing the enterprise. However, we would like to see applications that seek to do more than cover one person’s salary costs and can demonstrate a mature understanding of their business needs. Any roles paid for through the Social Innovation Challenge must abide by Living Wage and Fair Work First standards.

What is ‘direct social benefit’?

When a social enterprise carries out work or provides services itself for the good of its beneficiaries (this could be individuals, a community, or even the environment) we define this as ‘direct social benefit’.  On the other hand, when a social enterprise provides services to other organisations, who then go on to do the work with beneficiaries, this would be defined as ‘indirect social benefit’.

For example: an enterprise providing counselling services to a vulnerable group would be seen as direct social benefit; an enterprise providing counselling training to a charity who then provides this counselling to their beneficiaries would be seen as indirect social benefit.

I am looking to create a new social enterprise in partnership with other individuals and organisations. How do I evidence this in my application?

We want to encourage new ideas that are built on collaboration. If you have an idea that could be delivered through a new social enterprise, we would want to see that you have given extensive thought to how the social enterprise would operate, who the beneficiaries would be and that you have identified a suitable asset lock mechanism.

I am putting an application through an existing social enterprise.  How much evidence of income generation and social impact is required?

For the purposes of the Social Innovation Challenge, we do not require a track record of income generation or social impact, as we are keen to encourage strong new ideas that need a bit of support to get started.

What we are looking for in a successful application is strong evidence of the potential to generate both sustainable levels of income and significant social impact from your innovative new idea.  For existing social enterprises, this could be strengthened by being able to show that you have delivered projects that have been successful in these areas to date.

What do you mean by innovation?

• Projects that are implementing an entirely new approach that has not been tried elsewhere, but which has the potential to succeed based on evidence to date; or 
• Projects that are implementing tried and tested ideas in a new way; or 
• Projects that are reinventing an existing approach or way of working which has not previously been used to tackle their particular social or environmental issue; or 
• Projects where the core idea / solution is not new in itself, but has not yet been tried in the applicant’s geographical area or for their chosen social impact; or
• Evidence or a commitment to working with research partners to test potential and effectiveness of an idea; or
• Evidence of interest in innovation/pushing boundaries/thinking outside the box.

What do you meant by community engagement and participation?

It is important to make sure that those affected by the issues we are seeking to address are involved in the development of the proposed solutions. Therefore, we would like to see applications which can demonstrate that they have direct links with or that they have taken steps to engage relevant communities in conversations around the challenges they face and the potential solutions that could be developed.

We would also like to see that there are partnerships or mechanisms in place to test and deliver the solution within a relevant community.

You mention that you can cover cost for research and development, but not consultancy fees for business plans, market research, or feasibility studies. Does that mean applicants cannot work with academics on feasibility studies?

The Social Innovation Challenge can cover research costs where they are linked to monitoring, improving or scaling up a project and we actively encourage partnering up with academics who can deliver this work. However, we cannot cover earlier-stage feasibility studies that are investigating whether a project can go ahead or not. The Social Innovation Challenge aims to deliver social impact so there needs to be a clear potential to deliver positive social or environmental impacts.

Can applicants combine the Social Innovation Challenge with match-funding from other sources to create more capacity or to fund more roles?

Yes. You are encouraged to include details of other funds that you are applying for to potentially match with the Social Innovation Challenge. Each application will be considered as a whole on a case-by-case basis by the shortlisting and (if shortlisted) the judging panel.

£50,000 is not enough for my social enterprise solution.  Will you be giving support and guidance on other sources of funding?

The Social Innovation Challenge is awarding the largest single grant Firstport has been able to offer to date (£50,000). This acknowledges the additional challenges that innovative ideas face when looking to get off the ground. Like all social enterprises, the winner(s) of this challenge are likely to need support from a range of different sources, and we aim to help with that by building a personalised programme of support around the winner(s) of the Social Innovation Challenge. If what you need is additional funding or social investment, we will work with you to identify appropriate sources of funding, as well as looking at a programme of support to get you and your enterprise ready for taking on additional funds or social investment.

The Social Innovation Challenge is accepting applications from innovators at all stages of development. How will you compare applications from very early stage organisations, that might have great potential but take a while to get there, with those from more established organisations that can deliver impact more quickly?

We opened up the criteria for the Social Innovation Challenge to enable applications from anyone with a great social enterprise solution in response to the year’s theme. During assessment, we will consider each application on a case by case basis, but we will look for the strongest proposals when deciding the shortlist. We will look at how innovative the ideas are, their potential to create social and environmental impact, the links to the communities that they are planning to benefit and their potential to generate income to support the social mission.

Why a 0% interest loan? 

After over a decade of delivering the Social Entrepreneurs Fund, we know that our initial grant awards sometimes aren’t enough to get a social enterprise off the ground. Social entrepreneurs may have realised the potential of their idea and made the leap into full-time employment. However, they are still far from achieving sustained trading and can feel hesitant about taking on repayable investment.

We believe Step Up’s model is a perfect introduction to social investment. It helps social entrepreneurs understand how to secure investment and prepares them to take on further growth investment in the future. It also allows us to make our funds go further by using repayments to support other new social enterprises.

Why must I draw up extensive financial forecasts for such a small loan?
You need to be confident of your ability to make repayments before taking on repayable finance, so the process of drawing up long-range forecasts is as much for you as for us. We do not expect all the numbers in your projections to be exactly accurate, particularly as you look further into the future. We are looking to understand what drives income and expenditure. As you forecast into future years, consider new factors that may come to bear on your financial model. What impact will inflation have? Will you need to take on additional staff?

I need help on the application form or building my cash flow. Can you help me? 
Our Investment Readiness team is here to help! You can apply for bespoke 1-1 support or participate in a programme of workshops with other social enterprises exploring social investment. Check out LaunchMe. 

I am currently a participant in LaunchMe. Can I apply? 
Yes. Please discuss your plans with the LaunchMe team before applying. 

I have previously received a Boost It/ Pivot Fund award. Can I apply to Step Up? 
Step Up is awarded from the same fund as Boost It/ Pivot Fund and therefore enterprises that have already received the lifetime limit of £50,000 as a Boost It/ Pivot Fund award are ineligible for Step Up.

If your enterprise has received less than £50,000 as a Boost It/ Pivot Fund award, it will be eligible to apply for the difference between the value of the Boost It/ Pivot Fund award and £50,000. For example, if your enterprise received a Boost It award of £35,000, you may apply for up to £15,000 from Step Up.

I have previously received a Step Up loan. Can I apply again? 
You can apply to Step Up again if you have repaid your loan in full. You may apply to scale the successful growth strategy you have already funded further through Step Up or another, different strategy. It can be a good idea to start with a smaller loan, gain confidence in your growth strategy and ability to repay and then apply for a more significant amount.

If you want to apply multiple times, consider earlier repayment timescales when you apply so that you can repay and reapply without delay. There is a lifetime limit of £50,000 in total for Step Up awards to any single social enterprise.

I currently have a Catalyst Fund loan. Can I apply? 
We cannot provide two loans simultaneously, so you must have already fully repaid your Catalyst Fund loan before applying for Step Up. Equally, you must also have fully repaid any Step Up loans to be eligible for Catalyst Fund. 

My organisation has directors/trustees that are both employed by the enterprise and related to one another. Is it eligible for Step Up? 
To be eligible for Step Up, the governance of your enterprise must be independent. In practice, this means that members of the board must be independent both of each other and of the enterprise. To figure out if you meet this criteria, you should ask two separate questions about your board;

– Are any of the board members connected to each other? If yes, is it more than half of all board members? (Connected persons is subject to this definition.)
– Are any of the board members employed by the enterprise? If yes, is it more than half of all board members? (Freelancers or service providers are not considered to be employed by the enterprise.)

If the answer to EITHER of these questions is “yes, more than half” then the enterprise is not currently eligible for Step Up.

I am unable to complete the application form in the format given. What should I do?
If you need to make an application in a different format, please call 0131 564 0331 or email lauren[@]firstport.org.uk.

How often are there information webinars?

We run regular Office Hours webinars to provide you with more information about the Catalyst Fund and our other social investment products and support. You can find a full list of webinar dates and times on our Events page.

How does this compare to a private loan, or traditional social investment?

Traditional social investment mostly takes the form of term loans with fixed repayments each month with an interest rate applied. Catalyst has variable repayments from year 2 and is repaid for as long as it takes to reach a pre-agreed multiple of the investment. The total amount you will repay with Catalyst will be similar to a term loan, but the variable repayments ensure that it will be affordable as your business grows.

I am a start-up social enterprise, is this fund for me?

Whilst we accept early stage enterprises, you should be able to evidence trading income. This should be more than market research and should at least include trial trading, or letters of intent from interested customers, or pilots projects.

I just want to access the application form, can I do so?

Due to the nature of this fund, it is necessary to have a chat with a member of our team before starting an application form. This will help to establish whether this fund is right for you and allow you to chat to one of our advisors before submitting a formal application.

Once I have applied, how long will it be until I receive a decision?

It depends upon how much dialogue and assessment work is needed! We’ll work closely with you throughout the process and give you our best estimate of timescales.

I have already secured social investment, am I still eligible for this fund?

If you require further investment to grow AND can show that you will be able to service additional repayments but cannot access this from other social investment providers, then you may be eligible. You may need consent from your existing investors to raise further financing – check your terms and conditions.

What is revenue-based investment?

Revenue-based investment, revenue-based finance, revenue participation and quasi-equity are all terms used to describe similar funding practices where repayments are based on the performance of the organisation. A Catalyst Fund loan will be repaid by a percentage of your revenue until you repay an agreed multiple of the original investment amount. The overall total you repay will be similar to other social investment products that charge interest, just calculated differently.

Will Catalyst accept early repayment?

Yes. Your repayment will naturally increase with good trading performance but you may decide you want to pay off more earlier, or you may accept follow-on investment from another investor which enables you to exit from Catalyst. We are happy to discuss this.

Are there any things Catalyst won’t fund?

Aside from the eligibility criteria, we are a growth focused fund so we cannot fund businesses in financial distress, business as usual costs, or refinancing other funders or investors.

My enterprise will be trading across the whole of the UK. Is this eligible?

There are no geographical restrictions on trading. However, as the Social Entrepreneurs Fund and LaunchMe are funded by the Scottish Government, the majority of the social impact must be delivered in Scotland. This means that the majority of people who will benefit from the good work of the enterprise must live in Scotland.

I’ve already set up as a sole trader/private company limited by shares. Am I ineligible for funding?

Firstport funds individuals as opposed to organisations, so you can still apply whether or not you have set up a legal entity for your project, and regardless of the type of entity you have chosen. However, at assessment, we will want to know why you have chosen to go down a particular route, and whether you are committed to sticking with it.
We always encourage applicants to base their choice of legal structure on what is best for the business, as opposed to being influenced by eligibility criteria for any particular funding stream – via Firstport or any other source. Please contact us if you would like further advice on this subject.