Helping the homeless through crowdfunding
If you live in a large town or city, the chances are you see a number of homeless people on the streets on a regular basis. So what do you do? Give them some money, buy them a cup of coffee, make a donation to charity?
The problem with any of these actions is that we can never really be sure if they make a difference. Although we might want to feel like we are helping, the most important thing for any homeless person is to get off the streets. This requires a more strategic kind of support.
This is the remit of organisations such as Beam, which crowdfunds new career opportunities for homeless people. D/SRUPTION spoke to its founder Alex Stephany, to hear about how the organisation is transforming lives, and his thoughts on the use of technology for good.
An underused resource
Stephany was familiar with the crowdfunding model thanks to his experience with JustPark – a parking app which achieved what was the largest ever crowdfunding round for a startup a few years ago. Whilst running the business, Stephany confessed to “having itchy feet” about doing something in the social impact space.
“As I learned more about technology,” he says, “I thought there was a massive opportunity to use it for social good. I had a broad thesis that technology was probably under-leveraged by charities and by government.”
“I stepped down from that business wanting to use technology for social good but I wasn’t sure what that looked like. I then did a couple of entrepreneur in residence type roles at investment funds, met CEOs of different charities, VCs… But the most impactful conversation I ended up having was with this homeless man at my local tube station.”
“I’d buy him cups of coffee, pairs of socks when it was getting cold. But I could see his condition deteriorating. At one point he disappeared for about seven weeks, then he reappeared and he looked terrible. He said he’d had a heart attack. I walked home that evening to my nice flat and I thought, despite what I and other people had done this guy is in a worse position than ever.”
When wondering what would have made a real difference to this man’s life, Stephany came to an obvious conclusion. What he needed was the ability to support himself – the skills and training required to re-enter society. It would cost more than a cup of coffee, but crowdfunding could provide the answer…
A beam of hope
Beam was founded to make investments in people’s futures – a kind of long term, holistic answer to homelessness rather than the plaster-sticking type of solutions that have often been pursued in the past.
The rationale is simple and compelling. Where many of us want to help out when we see a homeless person on the street, crowdfunding can turn our small donation into something that will really help the individual to rebuild their life.
As well as the financial commitment donors make to Beam’s clients, they also provide messages of support, generating much needed confidence for the recipient. Hundreds of people crowdfund each individual’s campaign, but Beam’s model maintains a personalised touch.
“At Beam we are trying to build the most effective and empowering model ever to get long term unemployed, disadvantaged people into work,” says Stephany. “We think crowdfunding is an amazing model to do that because you are able to remove all the financial barriers that stand in the way. It might be training, it might be childcare for single mums – who are the biggest homeless group in the UK – it might be tools, transport, all kinds of things. But crucially you also build new support networks and new confidence for people from the funders of their campaign.”
Getting government on board
Fast forward a year and a half on from the first person Beam crowdfunded – who after 20 years out of work became an electrician – and the organisation has received over 15,000 donations, transforming the lives of homeless people through a development model with an 80 per cent success rate.
Importantly for Stephany, the organisation is now beginning to work with government in an effort to improve homelessness strategies on a wider scale.
“We are beginning to work more with government, both local and central,” he says. “This is really exciting, as we’re always looking for forward thinking local authorities to partner with. We want to build a service that will deliver value to the public sector and every single taxpayer. That’s ultimately how we think Beam can become a sustainable organisation.”
Social vs. enterprise
This raises interesting questions about the nature of social enterprise, and the sliding scale which differentiates charities, traditional business, and business for good.
“Social enterprise is a loosely defined term,” says Stephany. “You have social enterprises that are all types of different corporate structures. There is a definition of social enterprise on the Social Enterprise UK website, it talks about things like having a clear social and/or environmental mission, reinvesting the majority of profits, being accountable and transparent… I think that’s a good definition.”
For Stephany, the role of charities will never be replaced, as there are some problems which simply can’t be solved with a business model. But, where business can make a positive impact, the remit for social enterprise is clear.
“Wherever you can find a business model that will help you to solve a social problem, it’s great because it means you can do so much more with less. You’re not relying on the public to fund everything – including your salaries.”
“My thoughts are that there will be a new type of organisation which is a social impact organisation. At the moment, people are looking for new models. They are questioning whether the corporate model as we have it today is the right model. They are questioning whether the charity model is the right model. Social enterprise is perceived as a way that can combine some of the best bits of both. We want to grow an organisation that is generating revenues by creating social impact that is measurable.”
Tech for good
As someone with a clear desire to improve the world he lives in, Stephany is convinced of the power of technology to effect positive change. However, he maintains, we’re not making the most of it yet.
“So little of the focus of technology has been on social and environmental change,” he says. Even the private sector is just beginning to scratch the surface with what can be done with technology and data.”
“Unfortunately a huge amount of expertise has been sucked up in building platforms that are highly effective at selling advertising, and doing other things of very little social value. I think we are now at a crossroads where people are looking at Silicon Valley companies and are rightly questioning whether their impact has been positive.”
Fortunately, Stephany sees this existential crisis as a motivational factor leading some people in the technology industry to work on new things. This is compounded by the entry to the workplace of young people who are increasingly purpose driven.
“It’s massively exciting that there’s a new generation of people who are passionate about social and environmental progress and responsible business. They’re fast developing the skills and experience to genuinely change the world.”
“We won’t solve any large and complex problem without technology and data – environmental, social or otherwise. In that respect I think solving homelessness is no different to cancer diagnosis or urban logistics. You can’t solve it just through technology and data, but technology and data is a necessary part of the total solution.”
Aggregating charitable donations through a technology platform is an ingenious but simple solution to a complex problem. It also shows us that our cumulative impact as a group can far outweigh what we can achieve as individuals. When faced with similar pressing issues of our time, this is surely a valuable lesson learned.
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