LCR’s socially-trading organisations

What is an STO?

Socially-trading organisations (STOs) are businesses that deliver social benefits AND trade commercially. STOs are businesses with a social mission, who collaborate and increase their impact by working together to make a positive difference in their local communities. 

Socially-trading organisations are not limited to any particular legal form. They may include community businesses, community land trusts, community interest companies, social enterprises, cooperatives and some mission-driven companies, family businesses and local ventures who demonstrate social purpose through their actions and behaviour. 

The research

Kindred exists to meet demand. 2019 research by Seebohm Hill with the Heseltine Institute showed £11.3m investment in 42 STOs in the region, with projected demand from 740 organisations for £35m. Money invested in socially-trading businesses also offers significantly better financial returns than existing LCR investments, plus the additional value of social impact. The money Kindred invests will be used time and time again, as the investee businesses pay it forward, and value will be measured by both financial returns and social impacts.

Evidence from our pilot round directly address the government’s levelling up agenda and #BuildBackBetter commitment, including: 

  • STOs fill gaps in supply chains and address market failures that traditional business did not respond to, offering a pathfinder to a new economy
  • STOs offer speed and agility to the Liverpool City Region economy and its communities and should be grown to increase resilience
  • ‘Collaborating communities’ appeared to perform better than those working in isolation, so opportunities for STOs to support each other should be developed and the impact measured to provide better evidence