Bridges Ventures is delighted to announce its successful exit from CASA, the ground-breaking employee-owned domiciliary care social enterprise that has almost quadrupled its care provision in the last four years.
Bridges, a specialist sustainable and impact investor, backed CASA in 2011 via the award-winning Bridges Social Entrepreneurs Fund, a pioneering vehicle designed to provide capital to ambitious social enterprises looking to scale up. The Fund invested £400,000 in CASA using an innovative form of quasi-equity, whereby the investor is repaid if the borrower succeeded in meeting various growth and impact targets.
CASA has done this so successfully that it has now been able to raise a second round of social investment, led by Big Issue Invest.
CASA is an employee-owned social enterprise that provides high-quality domiciliary and complex health and social care to older, disabled and vulnerable people. Domiciliary care is becoming an increasingly important part of healthcare provision in the UK, as our ageing population places greater pressure on hospital capacity and more people wish to be cared for in the comfort of their own homes. However, operators in the sector have long struggled with high staff turnover – which can have a detrimental effect on service quality.
CASA seeks to counter this through an employee-owned model. By enabling its staff to influence decision-making, access better-quality training and share in its financial success, it can offer them more rewarding jobs – which in turn reduces turnover and leads to higher quality and consistency of care for service users. About 80% of its care visits are delivered by ‘key carers’, while staff turnover is currently about one-third lower than the industry average for private sector care companies.
CASA’s model has proved to be a strong competitive differentiator, particularly since the Government introduced the Social Value Act in 2012 (which requires those who commission public services to think about how they can secure wider social, economic and environmental benefits). By positioning itself as a flexible, socially-minded, locally-focused partner, CASA has been able to secure a number of new contracts. This has boosted revenues by over 250% since 2011.
When Bridges invested in CASA, it provided about 4,500 hours of care a week. Four years on, it provides more than 16,000 hours of care a week – a rise of over 250%. Across its six branches in Newcastle, North Tyneside, Knowsley, Leeds, Manchester and Warrington, it now employs over 700 people, over 93% of whom are drawn from traditionally underserved areas.
There is also clear potential for the CASA model to influence the sector more broadly: it has won plaudits from the Department of Health and others for its trail-blazing approach to homecare, including the recent ‘Outstanding Contribution to Social Care Award’ given to managing director Dr Guy Turnbull at the Great North East Care Awards 2015.
Bridges took a non-executive director position under the terms of the investment. Since 2011, it has worked closely with the board to help CASA establish a more robust financial and operational platform for growth. This included switching from a social franchise system to a wholly owned subsidiary model, strengthening the management team, and introducing new processes and performance metrics.
Dr Guy Turnbull, managing director of CASA, said:
“The investment came at a critical time for CASA and enabled us to achieve a step-change in our growth – allowing us to increase substantially the number of care hours we provide. During this period, Bridges has provided hands-on support as we looked to restructure the business and strengthen our management controls and reporting. As a result, we now have the organisational capacity to take on more Government contracts, as part of the ongoing effort to better align health and social care.”
Antony Ross, Partner & Head of Social Sector Funds at Bridges Ventures, and a CASA board director since 2013, said:
“CASA’s performance in the last few years has demonstrated that an employee ownership model can deliver a high quality of care with lower staff turnover – and as such, it can play an important role as the domiciliary care sector grows in significance. More broadly, CASA has shown that social sector organisations, when given the right kind of capital and support, can not only compete with private sector providers but in some cases actually have a competitive advantage over them. We’re delighted that the Social Entrepreneurs Fund has been able to play a part in proving this thesis – which has now catalysed this further round of social investment led by Big Issue Invest.”
Daniel Wilson-Dodd, Managing Director & Partner at Big Issue Invest, said:
“We are delighted to invest in CASA – and to demonstrate that there is now an active secondary market within social investment. This is crucial in order to ensure that ground-breaking enterprises like this continue to receive the growth capital and support they need.”
For the Bridges Social Entrepreneurs Fund – which received the Institutional Social Investment Award at the recent Cabinet Office Social Investment Awards – this is the second successful exit in the space of a few months: it also recently realised its investment in HCT, the social enterprise bus operator, which had also been able to surpass its growth and impact targets ahead of schedule after raising quasi-equity from a Bridges-led group of social investors in 2010.