Effervescent

Arts Impact Fund

The loan will allow the organisation to grow the team, explore commercialising their IP to build different revenue streams and enable them to take advantage of new opportunities.

Effervescent

Region: South West
Discipline: Other
Investment size: £150,000

Effervescent is a social enterprise and registered charity based in Devon. They passionately believe that children and young people have the insight, intelligence and imagination to make the world a better place. With backgrounds in child counselling, youth work, art and advertising, Effervescent have developed a unique methodology for co-producing creative campaigns with vulnerable children and young people. Their approach not only transforms the lives of those involved directly, but also produces exhibitions and communications campaigns that touch the lives of children and young people everywhere. 

These are individuals that have experienced traumatic starts to life; children who have lived with poverty, domestic violence, homelessness, sexual exploitation, alcoholic parents, neglect and abuse. In the right environment, these children and young people find incredibly honest and moving ways of articulating their own lived experiences in order to help others. Effervescent believe children who survive adverse childhoods develop the most diverse and unique solutions to problems. Alongside this, advertising is a key pillar of the UK’s thriving creative industries. The organisation saw the opportunity to bring these elements together. They believe the creative and critical thinking process of designing campaigns is highly beneficial to children, diverting them away from harmful behaviours or thinking patterns and reducing their need for health and social care services.

Since 2012 Effervescent have delivered 5,200 hours of intensive creative work with 260 vulnerable children and young people across the UK, creating profound change in their lives. 100% of these children and young people report that they are happier, healthier and feel more socially connected as a direct result of our work. 50% of them have gone on to access school, training or work within three months of completing our programmes of work. In that time Effervescent’s campaigns have reached live audiences of 75,000 and approximately 10m people worldwide.

These campaigns have been highly successful. For example, in the first seven months following their campaign to increase early stage referrals of psychosis, Cornwall and Isles of Scilly NHS Foundation Trust Early Intervention Team experienced a 71% uplift in referrals, which helped people to recover sooner and saved the NHS significant treatment costs.

Effervescent believe children who survive adverse childhoods develop the most diverse and unique solutions to problems.

Effervescent approached Arts Impact Fund for a £150,000 loan to be used in conjunction with a £50,000 performance-related loan and a £100,000 standard loan from Resonance. The organisation is in the process of transforming its business model to enable it to generate more revenue by commercialising its existing IP and creating further campaigns with young people that can help save clients money (such as local authorities) or support public services (such as the NHS). This investment will enable Effervescent to underpin their growth strategy with a team of sales and marketing personnel, customer management systems, marketing collateral and a brand refresh to reflect the products and services they offer. With greater earned income the organisation can shift away from its historic reactive and grant-funded programme model to a more strategic one; creating more chances for traumatised children and young people to heal, make a positive social impact in their communities and go on to form part of the creative workforce. 

Arts Impact Fund was impressed with the level of work that the team produce, with the young people driving the process – from idea generation to creation, and from marketing to pitching. This is a unique offer, giving them the freedom to express themselves and draw on their experiences in safe spaces to make beautiful pieces of work with lasting messages. This is an ambitious growth project and Effervescent will need to ensure they recruit the right people for the plan to be successful. As part of its due diligence process, the Arts Impact Fund team engaged with the full team and board, who are all highly focused on delivering the needed capacity and growth. They have also been working with a recruitment specialist to find the best candidates for the new roles. The level of applicants has been especially high as people believe in the work that Effervescent do and want to contribute to the change they create. Using the investment, the team will also be working together to create an overarching organisational approach to impact and evaluation and will explore how to use gamification as a method for collecting evaluation data.

This is an incredible opportunity for the organisation to grow their reach and support even more vulnerable young people across the UK. But this is also an interesting opportunity for Arts Impact Fund, with the investment proposition being unique in the portfolio. This prompted the team to think about exploring other financing instruments to see how these could be tested. Arts Impact Fund structured the £150,000 investment in two parts; £100,000 was a standard loan agreement with a fixed interest rate and £50,000 was a Revenue Participation Agreement that entitles the lender to receive a share of the gross income at a set percentage over the term of the loan. This is a performance-related investment, meaning that if Effervescent does well in growing its income, so will we. However, if it underperforms, we run the risk of not recouping our full investment. This is a new venture for Arts Impact Fund – the team strives to be innovative with their approach and are excited to test how it will work in practice and how it could be used in the future.