The health and social sectors are experiencing an array of funding challenges, from ever-diminishing NHS resources to time-limited government grants.
But there are also opportunities. Strategies like crowdfunding and strategic private collaborations represent powerful ways of filling the gaps left by more traditional funding models. These innovative funding strategies can solve the problems faced by care leaders.
In this article, we’ll look at these funding methods and explain how you can implement them in your organisation.
Overview of traditional funding methods
Let’s recap the main funding methods health and social care organisations use.
- NHS and local authority funding: Tax-based funding accounts for the greater percentage of health and social care resources.
- Government grants: Grants are typically allocated for specific projects or initiatives.
- Traditional donations: Donations of this sort are collected through traditional means like standing orders and phone outreach initiatives.
It’s important to remember that these strategies are not redundant. Rather, they are insufficient on their own to account for the challenges faced by modern care organisations.
Innovative funding strategies
Over the last several years, several innovative funding strategies have emerged. And they remain largely underused, giving fast-acting health and social care organisations a unique opportunity.
- “Hidden” government grants and loans: By staying informed of the latest government funding cycles and criteria, you can often secure essential funding not widely utilised by others.
- Private investment in emerging sectors: Private investors are eager to partner with companies in the health and social care sectors, both of which are experiencing growth. An emphasis on your differentiating innovations and the potential for high returns will likely engage investors.
- Industry partnerships: Forming partnerships with technology firms, academic institutions and other healthcare entities can open up new funding sources. These collaborations are typically focused on research and innovation outcomes.
- Crowdfunding and social impact bonds: Crowdfunding and social impact bonds, where investors are rewarded with a portion of the savings that result from social initiatives, offer the dual benefits of community engagement and financial support. Understanding how to effectively market these initiatives can draw in funds from a broad audience.
Case study: Transforming licensing costs into revenue
One of our current clients sought us out to help with hefty licensing fees associated with their management system. They work in a public service capacity, so any savings that could be passed on to customers would be valued.
They tasked us with the creation of a bespoke system, exclusively owned by them, that would eliminate ongoing licensing expenses.
In addition to building the new solution, we identified a unique opportunity to license it out to their partners and competitors. This innovative approach transformed a former operational cost into a new revenue stream.
Over time, we expect this strategy to significantly enhance profitability as they continue to partner with more organisations.
Building an effective investment strategy: 5 practical tips
Your investment approach will be more successful if you combine a broad understanding of opportunities with a selective approach to targeting them.
- Understand your options: Angel investment, R&D grants, startup loans—it is vital to gain a clear picture of all the investment opportunities available to you.
- Demonstrate value: Clearly articulate your complete value proposition to potential funding sources. Show how you meet specific needs within your sector in a sustainable way.
- Prioritise long-term funding options: While short-term funding has its place, it is far more prudent to prioritise longer-term opportunities.
- Consider investment training: Partnering with an experienced third-party organisation like Waymark can help you identify opportunities, refine your pitch and ensure your team is well-placed to deliver it.
- Offer data and metrics: Use data and metrics to support your investment case. Quantitative evidence of your project's impact or potential market size can be persuasive, providing tangible proof of its viability.
Conclusion
If you can think creatively and strategically about funding opportunities, you are much more likely to secure long-term, sustainable access to the resources you need.
Understanding the many funding options available is your first step. You can then use this information to craft compelling, effective pitches to maximise your chances of being chosen.
Keep in mind that an effective funding strategy requires regular and evolving familiarity with new and innovative funding routes, private and public funding cycles and the latest investor expectations and requirements.
Book your free Xploration
Are you eager to see the benefits of the very latest funding strategies in your health or social care organisation?
Book a free Xploration now to learn how you can take advantage of the many available opportunities.
