Dismantling Disadvantage: The Inspiring Story of Social Enterprise Renew
In the ongoing battle against youth disadvantage, social enterprises like Dismantle have emerged as a beacon of hope. Based in Perth, Dismantle empowers young people to reach their full potential through innovative services and programs like ReNew Property Maintenance (ReNew), a social enterprise that creates job opportunities and skills training for young people from marginalised backgrounds. In this case study, we take a closer look at the growth and journey of Dismantle and ReNew and how they have raised blended finance to scale their positive social impact and drastically change lives.
Founded in 2010, Dismantle aims to empower at-risk young people through skills-based learning, supportive mentoring and employment pathways. The enterprise offers a range of programs and services, including BikeRescue, which builds young people’s teamwork and communication skills.
Dismantle’s focus shifted to job creation in response to their experience working with at-risk young people for over 10 years, many of whom often have limited resources and opportunities at their disposal.
“Most of the young people we work with come to us without the basics, on paper they are not good candidates for a typical employer. But it’s hard to focus on school, work, or bigger aspirations when you’re in survival mode. We are frequently finding our young people in crisis accommodation or just making sure they’ve got lunch," said Pat Ryan, CEO at Dismantle.
About Renew Property Maintenance
Dismantle started a new social enterprise, ReNew Property Maintenance (ReNew), in 2019. ReNew provides young people with paid employment opportunities, taking advantage of local demand for maintenance services to provide young people with a program of vocational training and paid work experience, ensuring a longer transition and mentorship period on the way to the workforce.
The enterprise provides a range of services to commercial and residential properties and is now a major component of Dismantle’s offerings. Young people employed by Renew work alongside experienced maintenance professionals and receive on the job training. The program is tailored to meet the young people’s individual needs to help them transition to further employment or work towards their Certificate II in Construction Pathways.
ReNew’s mission is to support young people to get to a place where they can successfully transition out of the organisation onto further employment, education or training. This support comes in many forms, including on the job training and upskilling, in-house case management to address home and personal issues, professional development, setting individuals up with bank accounts, and providing them with the resources they need to actively pursue their next step. ReNew is also committed to building a nurturing and supportive work environment where young people can improve their wellbeing, learn new skills, and gain valuable professional experience.
"One young person wasn’t showing up to work and when we dug a bit deeper, he told us both of his parents were in jail and he didn’t know where he was supposed to sleep long- term. Without intervention, this crippling level of instability and lack of support cements a bleak future and a cycle of disadvantage that we’re trying to break. They’re always a little bit wobbly at the start, but the change we see in confidence, personal responsibility and their aspirations for the future is transformative after just a few weeks on the job,” Pat Ryan said.
In just four short years, ReNew has grown its idea into a portfolio that counts Charter Hall, Spotless and the City of Mosman Park as clients, generating over 80 award-wage jobs for disadvantaged young people each year. To date, over 75% of ReNew's youth employees have successfully transitioned to further employment, education or training.
Capacity Building Support
Back in 2020, Dismantle participated in the first cohort of Scaling Impact, Social Impact Hub's accelerator program that helps social enterprises and purpose-driven startups grow their business and prepare for impact investment. As part of the program, Dismantle received tailored advice on the optimal legal structure to grow its social enterprises effectively, including ReNew, which enabled them to consolidate their governance and scale their operations.
“We’re very grateful to have been able to take part in Scaling Impact and continue a working relationship with Social Impact Hub," said Ryan.
Following Scaling Impact, Social Impact Hub further worked with Dismantle on ReNew's impact investment readiness journey and coordinated a multi-stage blended capital raise with the support of an Impact Investment Readiness Growth Grant provided by the Department of Social Services.
"It's quite hard to get grants for social enterprise trade, and so we looked to impact investment and have been lucky enough to work with Social Impact Hub to get our investment projections and everything in order to take to potential investors," said Ryan.
Social Impact Hub supported Dismantle through a nine-stage investment readiness process from growth strategy and financial modelling through to market analysis, legal structure and the creation and execution of legal contracts. The Social Impact Hub also facilitated investor introductions, helped develop an investor memorandum and pitch deck, and offered valuable guidance which positioned Dismantle for a successful capital-raising journey. "The external capacity building services provided by Social Impact Hub have been invaluable in preparing us to raise capital. Their expertise, guidance, and network have helped us develop a strong foundation for engaging with investors and positioning our enterprise for long-term growth and impact," reflected Yean Ng, Dismantle's Chief Financial Officer.
Raising Capital
Dismantle initially raised $200,000 in low cost debt from Spinifex Trust, to relieve cashflow pressure given the long payment terms associated with typical jobs. Dismantle had a pre-existing relationship with Spinifex Trust as a philanthropic funder. Sophie Chamberlain, Director of Spinifex Trust, had initially met Dismantle through Impact100 WA, where Dismantle won $100,000 in 2018 to establish ReNew.
"We knew this was an opportunity to make a powerful difference," said Chamberlain. "These smaller social enterprises produce outstanding outcomes but need financial backing to give them lift-off. We'll get our money back along with both the interest and strong social benefits.”
In addition to a $300,000 grant from Westpac Foundation, an existing grant partner, ReNew successfully raised $250,000 in low-cost debt from five Perth-based foundations and $500,000 of philanthropy from Paul Ramsay Foundation. ReNew also secured $340,000 of equipment finance for a fleet of nine vehicles, tools and equipment. The capital will enable ReNew to scale in response to its existing pipeline of demand for its services, tender for and execute on contracts currently beyond its reach, and employ an additional five work crews (50 young people).
Challenges & Learnings
The journey of raising capital for ReNew has been instrumental in driving the company's growth and achievements. Along the way, the enterprise encountered various challenges, including talent acquisition and cash flow management.
The competitive labour market made it difficult for ReNew to recruit team leaders at a pace that aligned with their growing demands. Additionally, managing cash flow proved challenging due to some customers' non-negotiable payment terms, causing delays in receiving payments. Consequently, ReNew had to diligently monitor cash flow to adapt to these payment cycles and maintain seamless business operations.
Despite the challenges faced, ReNew has been able to secure significant capital and achieve key milestones along its capital raising journey. These accomplishments position the enterprise for continued growth, enabling it to expand its operations, enhance its impact, and provide more opportunities for young people in need.
For social enterprises embarking on capital raising journeys, there are several key lessons that can be drawn from ReNew's experience. First, it is crucial to focus on strengthening internal capacity by investing in systems, processes, and talent for effective growth management and investor relationships. One way ReNew did this was by leveraging external resources like the Social Impact Hub's Professional Impact Network for tailored assistance and expert advice. Additionally, it is important to develop an engaging narrative that clearly conveys a social enterprise's social and financial objectives while emphasising its unique value proposition and potential impact to attract mission-aligned investors.
ReNew's success also boiled down to its leaderships ability to foster strong investor relationships through meaningful conversations, transparent updates, and timely communication, building trust and confidence with accurate financial reporting and well-defined impact metrics.
Looking Ahead
ReNew's impact-led investment marks a positive step forward for Western Australia’s social enterprise sector.
"The amount of capital that can be unlocked for social and environmental outcomes with arrangements like we’ve just made with Spinifex is enormous in this state. Funding impact doesn’t have to come as a one-way donation. We hope we can be a lighthouse for similar investments across the state and catch up to the rich and diverse ecosystem of impact investment that has been developing and succeeding in the eastern states for over a decade," said Ryan.
ReNew is also taking part in a landmark $3.8M trial exploring the effectiveness of jobs-focused social enterprises in delivering long-term employment outcomes for people living with a disability. As part of the first Payment By Outcomes (PBO) trial that involves social enterprises and impact investors, ReNew will receive outcomes-based payments when participating employees maintain employment after 6, 12 and 18 months, with additional payments if the candidate has successfully transitioned onto further employment. "As the only organisation from WA taking part in the scheme we're also proud to pioneer this in our state and represent the emerging social enterprise sector at a national level," said Ryan.
"It’s really simple," said Ryan. "The most significant barrier to getting a job, is having basic work-readiness skills, which you learn in your first job. Our young people have been denied this opportunity for a myriad of reasons all linked to disadvantage, so getting into the workforce with us, means they’re far better equipped and likely to go onto further employment, breaking the cycle of entrenched disadvantage. ReNew is not about turning young people into gardeners, it’s about empowering them to find a horizon to work towards and equipping them to do it.”
The inspiring story of Dismantle and ReNew serves as a beacon of hope and a reminder of the transformative power of social entrepreneurship with the backing of investment. Through their commitment to helping young people gain employment opportunities and agile fundraising approaches to fuel growth, they are well positioned to scale the lasting change they are creating in the lives of many disadvantaged youth. With more initiatives like ReNew, we could potentially see a future where everyone has access to equal opportunity for success regardless of background or circumstances.