Resonance - Twenty Years Of Impact - Report - Page 8
2 THE START OF A TWENTY YEAR JOURNEY
Serendipity
Just over a year into the new millennium, when
concerns over the Y2K glitch were fading and the
Eden Project in Cornwall opened the doors to the
world’s largest greenhouse, a serendipitous meeting
took place. Daniel Brewer, a recent graduate from
Cambridge University, first met his now mentor,
friend and cofounder of Resonance, Peter Dawe.
Peter, a serial entrepreneur, who was behind the first
commercial internet service provider Pipex, was
looking to team up with an ‘apprentice entrepreneur’.
Daniel applied to take part in the project, which was
structured so that he would work on a project of
Peter’s choice for one year, and then Peter would
modestly fund Daniel, to run a project of his own
choice.
The project was to Solve the Poverty Trap in the UK
and Reform the Benefits System. Little did Daniel
realise as he embarked on this work, that the main
outcome of getting the government to back local
housing allowances, allowing landlords to know
what they would earn if they rented a property in a
certain location, would be one of the key building
blocks of the Resonance Homelessness Property
Funds that would be designed and launched some
years later.
In 2002, as Her Majesty was preparing to celebrate
her Golden Jubilee and the European Union
officially introduced the Euro to the worldwide
currency system, Daniel registered Resonance with
Companies House, having received some seed
investment from the Dawe Charitable Trust, with
Peter as a non-exec director. After many discussions
with Peter, the conclusion that Daniel came to was
that many great not-for-profit organisations were
unable to grow and do more good, as they had no
access to growth capital.
There must be a better way
Three things coalesce in Daniel’s memory about the
genesis of Resonance. Firstly from his initial career
in engineering, he saw first-hand how big business
defined shareholder value narrowly, as this quarter’s
profit, at the expense of pretty much everything else.
He thought there must be a better way of connecting
shareholders and business leaders around a set of
values that are not just about profit.
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The second thing that he discovered whilst working
on the poverty trap, was that some companies
were putting their purpose first and helping people
transition from the benefits system to the world of
work; often as small profit-making companies such
as cleaning or furniture recycling. He recognised
that these businesses were both trading and
delivering an impact – they were purpose-led and
sustainable. And finally, the third dimension was
Peter’s experience of being a trustee of an endowed
charitable trust. Peter felt the classic model was
both propping up a system of exploitation on the
investment side only to feed a system of dependency
on the donation side. It became clear to them that
making trading charities - social enterprises as they
would become known - sustainable, was the best
way to ensure their future and scale their social
impact.
An investment company in Cornwall?
Daniel, who was living in London with his young
family at the time Resonance was born, spent his
time working with a small number of East London
social enterprises, supporting them to develop their
business models. He was very focused on how
social enterprises could work effectively to scale up
their impact, as well as developing their theories of
change. Gradually he did a bit more work nationally.
Then in 2006 Resonance ran a project with Charity
Bank, funded by Baring Foundation, that was
designed to help social enterprises in Cornwall to
prepare for investment. As many of Resonance’s
clients were now in Cornwall, Resonance and the
Brewer family moved to the deep South West.
People Daniel met were occasionally bewildered that
an investment company could be headquartered
in Cornwall. However, operating costs were lower,
there were a rich network of South West social
enterprises and routes into London were much more
efficient than the other way around.
Blueprint deal
In 2007 whilst Gordon Brown was settling in as the
new Prime Minster and the new Wembley Stadium
was completed, Daniel successfully arranged the
community share offer for Community Benefit
Society Mustard Seed Property. It enabled the
purchase of a property that prevented a handful of
vulnerable adults, including some with learning
disabilities, from becoming homeless, whilst
learning skills and gaining confidence in managing
stable lifestyles. This would be the blueprint for
future property funds and transactions, that would
help charities and housing partners to acquire the
properties they needed.
Building an effective and resilient team
Not long after moving to Cornwall, Daniel met Bob
Paterson of Community Land & Finance and Salford
University, when he was asked by Bob to provide
support and advice to community land trust projects
in Devon and Somerset. This relationship would
eventually lead to the development of Resonance’s
first two community asset funds, the Community
Share Underwriting Fund and the Affordable Homes
Rental Fund. Bob, a former Housing Association
CEO, brought with him a depth of experience of
working with community housing projects and with
Daniel’s growing experience in property acquisition
for charities, their skills complimented one another,
and their organisations merged.
One of Bob’s responsibilities was to make
Resonance more resilient and help it grow, and it
was as part of that process that Simon Chisholm
joined Resonance as Investment Director, located
in Manchester. This would prove to be a key
appointment and the commencement of the next
phase in Resonance’s evolution. Simon brought with
him years of experience of the investment world
having worked at Rothschild & Co, but he also had
first-hand experience of social enterprise having
served as a trustee for a pioneering London-based
homelessness charity. This foundation of knowledge
and experience, coupled with Daniel’s now ten years
of entrepreneurialism lit a spark at Resonance as it
moved from just Peter and Daniel to an operational
pairing that would lead to new fund development
and of course the Manchester footprint where Simon
was based.
The launch of the Real Lettings Property Fund in
2013 was the start of the company’s serious growth
as it helped Broadway (later merged into St Mungo’s)
scale up its access to the properties it needed. The
organisation was in good health but with limited
capacity or appetite to borrow. Resonance helped
them scale a solution off their balance sheet, through
leasing property on flexible terms and accessed
£250m of property investment for St Mungo’s –
something they definitely could not have achieved
by just borrowing in the market.
A SERENDIPITOUS
MEETING BETWEEN
PETER DAWE AND
DANIEL BREWER,
LED TO A TWENTY
YEAR FRIENDSHIP.
The first ten years of Resonance was a story of
pioneering and learning, hope, aspiration and good
fortune that the right people met each other at the
right time. We share the reflections of Rebecca
Brewer, Bob Paterson, Simon Chisholm and Sharon
Gorman from that roller coaster period, but here’s
one final thought from Peter Dawe, before we hear
their stories.
“As with all things pioneering, more
than one person works in a space and
claiming credit is always debateable,
but I would argue that Resonance was
certainly a significant pioneer in the
whole of impact investing and through
Resonance’s work over the past twenty
years, we have gone from a world where
impact investing didn’t exist, to where
hundreds of billions are now invested
worldwide.”
Later in 2012, when the UK (including the Queen
who was now celebrating sixty years on the
throne) was glued to screens watching the many
UK Olympians win gold at the London Olympics,
another key appointment was made, with Sharon
Gorman joining Resonance as Finance Manager and
John Williams as Investment Manager.
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