In response to funding trends and increasing service demands, some community organizations, including United Way Centraide, are shifting from traditional funding models to community investment strategies. President and CEO Dan Clement shares three case studies that highlight how it works.
Quantifying the economic value of Canada’s non-profit and charitable organizations is a source of debate; however, it is an under-recognized economic engine. The community services subsector alone employs more than 620,000 people and contributes $25 billion to Canada’s gross domestic product. As the sector struggles to meet high demand for services while working with restricted, flat, or declining revenues and to confront the risk of reduced government funding, the sector faces growing financial strain. At the same time, a powerful transformation is underway.
In response to increasing service demands and current funding trends, there is a growing need for adaptive and complementary approaches, and some community organizations have been reimagining their roles, stepping outside traditional funding models to form partnerships that leverage their knowledge of community needs. Moving from funders/grantmakers to investors/collaborators, the social sector is exploring shared-risk models, blending private and public capital, and embedding local community-building expertise within business skill development.
United Way Centraide (UWC), a network of local experts present in more than 5,000 communities across Canada, is among the organizations deeply engaged in this shift as a funder, collaborator, convenor, and community-builder. This work offers an unparalleled opportunity to gain insight into emerging trends and generate collaborative solutions to sector challenges.
What’s emerging is a financial shift and a philosophical one: the realization that investing in community-driven economic development can yield lasting returns. After decades of underfunding and workforce challenges, underscoring the vital role our sector plays in stimulating social and economic growth is essential to building long-term resilience.
Three case studies demonstrate how UWC and our partners are adapting to these realities in ways that are tailored to local communities. We’ve developed scalable solutions that deepen our ties with each community and bring forward important lessons for our sector.
The Impact & Leadership Development Program (ILDP), supported by United Way British Columbia (UWBC) as the backbone organization, was established in 2018 to help non-profit social enterprises, or businesses that prioritize a social mission alongside financial goals, build sustainability and resilience. The initiative offers subsidized access to coaching and mentorship that provides leaders with capacity building and professional development, which is rarely funded. Amplifying the sector’s entrepreneurial spirit, the ILDP helps leaders level up their skills to strengthen strategy, build sustainability, stabilize operations, and increase the scale and depth of their impact.
A success story is Elevation Outdoors, a charity recently featured on CBC that provides outdoor recreation, life skills development, and mentorship to youth. The ILDP supported the development of a new bike-rental social enterprise to create revenue and employment opportunities while reducing reliance on grants.
The support helped us think more strategically, build better systems, and ultimately serve more kids.
Mike Greer, Elevation Outdoors
“ILDP helped us build a foundation for sustainable growth, from launching new revenue streams to deepening our social impact,” says Mike Greer, executive director at Elevation Outdoors, which also began offering sliding-scale fee-for-service outdoor recreation programs that support free access for lower-income youth while bringing mixed-income youth into shared spaces. UWBC is a long-time co-funder of ILDP alongside several credit unions and community foundations; since inception, UWBC has invested approximately $150,000. Purppl, the private-sector ILDP delivery partner and a social enterprise itself, provided specific expertise. “The support helped us think more strategically, build better systems, and ultimately serve more kids,” Greer says. “It’s been a catalyst for our organization and our community.” The program has helped more than 50 organizations to develop and expand social enterprises and revenue-generating businesses while enabling more sustainable delivery of services that meet community needs. These jobs and the social impact last beyond funding cycles and can be replicated in other communities.
A paradigm shift was key to its success: a grant program became seen as a community investment strategy. In the long run, it became evident that these social enterprises constituted investments that paid dividends in financial return, but also in social value. Whether by providing leaders with mentorship around information management or financial modelling, Purppl, in partnership with UWBC, delivered the coaching required to level up the business skills in each enterprise.
Organizations like credit unions are now sitting at the same table, shifting relationships from market competition to community collaboration; however, the real lesson for UWBC was to step outside the traditional funder role and seek out cross-sector partnerships to fill gaps in expertise. This new mindset positions the social sector as an investor in a community’s long-term resilience.
In Calgary, a partnership between United Way of Calgary and Area (UWCA) and Innovate Calgary at the University of Calgary has yielded similar lessons: seed funds can launch social enterprises, but adding wraparound supports can ensure their sustainability. Through their partnership, UWCA and UCalgary created UCeed, a social impact fund that provides financial and social return through seed funding. Leveraging UCalgary’s research capacity and the credibility of the local United Way, a jointly managed $4.55-million fund allows each party to participate in the investment approval process according to their objectives. So far, UCeed has funded 24 social enterprises that respond to complex social issues and generate revenue to replenish the fund in perpetuity, alongside economic development through job creation, employment, and even tax revenue.
By investing in ventures that deliver both social and financial returns, we’re supporting innovation that reflects our values and creates lasting economic opportunities.
Geoff Couldrey, United Way of Calgary and Area
“Our UCeed partnership marks a new approach to how United Way of Calgary and Area creates community impact,” says Geoff Couldrey, chief transformation officer at UWCA. Like the ILDP, UCeed works closely with the funded organizations, providing support to scale impact and revenue. For UWCA it was a new role, entering as an investor, strategically shifting focus from the current industry standard of measuring short-term impact, and looking at long-term economic and social return that is not typically possible through short-term grants or loans. “By investing in ventures that deliver both social and financial returns,” Couldrey says, “we’re supporting innovation that reflects our values and creates lasting economic opportunities. It’s a model of shared responsibility and resilience.”
Social impact is embedded in each investment, supporting social enterprises in achieving a financial return and mitigating risk by pooling grants from multiple sources to fund more projects. UCeed benefited from UWCA’s wide reach and access to resources and UCalgary’s business expertise to deliver an evergreen funding model that creates economic opportunities for years beyond the initial grant. Underscoring the importance of expanding on the grantmaking role, social impact investment builds resilience to economic uncertainty.
Another initiative based in Toronto is responding to the reality that neighbourhood development doesn’t necessarily mean wealth for residents. The community sector has long been aware of wealth-distribution challenges in neighbourhood revitalization, which spurred the creation of the Inclusive Local Economic Opportunity (ILEO) initiative, co-convened by United Way Greater Toronto (UWGT) and BMO Financial Group.
Recognizing the private sector as a key player in this complex social issue, ILEO brings together partners from all sectors to work at the neighbourhood level so that impact is concentrated in one geographical area and easier to articulate. A leadership table was formed to steer and champion the work, with partners from the private, public, and community sectors coming together as collaborators.
We knew we needed real collaboration across sectors if we were going to make an impact. The Leadership Table members stepped up in new ways, sharing their networks, knowledge, and workforce.
Darryl White, BMO Financial Group
“When BMO partnered with United Way Greater Toronto to co-convene ILEO, we knew we needed real collaboration across sectors if we were going to make an impact. The Leadership Table members stepped up in new ways, sharing their networks, knowledge, and workforce,” says Darryl White, CEO of BMO Financial Group.
For the private sector, this shifted the dynamic from granting funds to one of shared responsibility where parties join efforts as problem-solvers, taking strategic risks and sharing expertise. An example of one private-sector partner’s contribution was to work with the UWGT project team to create an impact-measurement framework.
Working at a neighbourhood level has made it easier for private-sector partners to understand their impact on the community. As a result, they have shown up as actively engaged implementers, as demonstrated by the example of Aecon Golden Mile, a shared venture – 51% owned by the community, 49% owned by Aecon – where neighbourhood residents are trained and hired to do utilities work, and 51% of the profits are returned to community.
“ILEO is a master class in how United Way Greater Toronto operates: working in the neighbourhoods where we’re needed and pulling together the partners that are necessary to make change,” says Heather McDonald, president and CEO of UWGT.
Shared responsibility was critical to ILEO, which has been named one of Canada’s Frontrunner Innovations for Urban Transformations aligned with the United Nations Sustainable Development Goals.
“Today, the combined impact of our work is millions of dollars in financial return for residents in the community, and we are now expanding the work to a new geography,” White says. The success of ILEO goes beyond its financial return to the community, which now totals more than $15 million, ultimately giving a seat at the table to every sector, from the outset.
Inviting the private sector, government, funders, and community agencies to work together, inspired by the priorities of local residents, UWGT acts not only as a co-funder, but also as a convenor and lead agency, learning about and leveraging business practices, evaluation methodology, and capacity-building to benefit the local community and support inclusive economic participation.
Through each of these initiatives and many more, the UWC network has learned the value of working collaboratively with diverse partners, taking on a community investment lens and expanding the traditional funder role into that of a convenor, lead investor, and business partner. However, we must not forget our sector’s role as an advocate, as a growing crisis threatens the social sector’s workforce. Challenges in recruitment and retention add to the pressure on community organizations to do more with fewer resources. United Way Centraide Canada, the national office of the UWC network, is leading a diverse coalition of partners in delivering a national comprehensive Labour Force Strategy focusing on the community services sector.
In uncertain economic times, it is vital that we advocate for further investment in the social sector, and that funders, corporations, and other partners find ways to work in partnership with local communities to create long-term economic and social value so that communities can flourish for years ahead.
