Three ways to unlock collaboration between startups and the third sector

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1. Unlock third sector funding for innovation

Third sector organisations struggle to fund collaborations with startups. Relatively small budgets are one part of the problem — to illustrate, the top ten UK corporate R&D spenders spend more on R&D alone ( £13.6 billion per year) than the largest 51 UK charities spend in each year in total ( £11.1 billion). A lack of flexible capital in the third sector poses an even greater challenge. Money is often earmarked (when projects are grant- or legacy- funded, for example) and therefore cannot easily be allocated to startup collaboration. By law, it is also difficult to fund for-profit startups because charities need to demonstrate that sufficient public benefit can be derived. As a result, promising collaborations often fail because there is no dedicated budget behind them.

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