Gareth Jones spoke to Belu Water chief executive Karen Lynch to hear how she turned a sputtering startup into a successful social enterprise
Belu Water expects to generate over £1 million a year for Water Aid, its sole beneficiary – impressive stuff for a company set up with a mission to create carbon-neutral bottle water.
The driving force behind this success is managing director Karen Lynch. After 10 years in the private sector, latterly as a marketing manager at Barclay’s Bank, Lynch moved to Belu with the task of turning the then four-year-old company into a profitable venture.
Under her leadership Belu has become a huge commercial success, demonstrating that business with a social mission can be self-sufficient and make money.
After Lynch moved to the company, it began posting profits after making a £698,800 loss in 2007. She took over as managing director in 2010, and more than doubled its turnover from £2.5m to £5.6m.
After leaving Barclay’s Karen was initially drawn to the idea of working for a charity.
“I felt I was missing passion and purpose in my previous role. I was looking at jobs in the charity sector because I really wanted to make a difference,” she explains.
“However I then established with myself that I am good at running a business, so a social enterprise was a natural fit for me.”
When Karen joined Belu, the social enterprise was struggling to make ends meet – balancing producing ethical products with carrying out work on the ground to help communities across the world access clean water.
The chief executive worked to not only tighten the company’s business plan, but also to ensure that raising funds for the people that Belu pledged to help was placed at the heart of the organisation.
An asset lock was introduced into the structure of the company, as a mechanism of guaranteeing all of Belu’s profits would go to WaterAid. This meant the charity, for all intents and purposes, became the company’s only shareholder.
“I think it is really important that you seem credible with customers, it has never been more important to be considered a credible business,” says Karen. “By having WaterAid acting effectively as our only shareholder, it is very clear to people that we are committed to supporting them.
“When we first launched our partnership with WaterAid, we had pretty conservative expectations. We surpassed our initial targets and have gone on to raise £3m for them since 2011. We have now set raising £1 million a year for the charity as a Key Performance Indicator.”
The asset lock is just one of the models that social enterprises can use to ensure they are keeping their charitable activities central to their structures, and one that Karen thinks could work well for a range of organisations.
In recent times, Belu has also placed more of a focus on its work to reduce plastic pollution.
Originally, the water was sold in glass bottles only, however in 2006 it was distributed in the UK’s first compostable plastic bottle. Now, in response to concerns about how difficult it is to recycle bio bottles, it has moved to a new bottle that uses the highest percentage recycled plastic of any water bottle in the UK.
All of this ensures that Belu sticks to its original intent to be completely carbon neutral.
In this way, Belu is helping to lead the way across the whole business community in sustainable drinks packaging, proving that commercial businesses can learn from social enterprises.
As Karen prepares to speak in Edinburgh at next month’s Social Enterprise World Forum, she is exploring the idea of how social enterprises can work alongside private businesses.
“One of the key roles of social enterprises should be to act as innovators,” she says. “They can explore what can be done and can act as examples to other organisations of how wider benefit can be created whilst operating as a successful business.”
The Social Enterprise World Forum is all about celebrating the success of the sector and encouraging collaboration. And Karen has a really positive message to deliver.
“I think there has to be room for more collaboration in the sector,” said Karen. “Social enterprise is all about sharing, learning and working together to show that social enterprise is the unbeatable option.”
Karen Lynch is speaking at the Social Enterprise World Forum from Wednesday 12 – Friday 14 September
