Prisoners' bake for Freedom brings relief
Prison bakery proves attractive proposition for both investors and a foundation; it's now on the rise.
When Matt Fountain needed social investment to launch his prison bakery, the prospect of using a social finance intermediary didn't appeal. The social entrepreneur thought the process seemed long and expensive and so raised a £48,000 loan suitable for Social Investment Tax Relief (SITR) through his own network.
The Cambridge graduate, who opened Freedom Bakery at Low Moss prison, Glasgow, in June, employs six inmates full time to make bread for local shops and delis, and is also about to launch a bread van which will serve the public. It is believed to be both the first SITR investment deal for a start-up and the first in Scotland.
“Development agencies think you can prove a concept with £20,000, but some ideas do need more money, so that lead me elsewhere,” Fountain tells Pioneers Post. “Social investment, particularly using SITR, is still in its early days and can be a long and expensive process using an intermediary, so I did it myself. I used my network and it took about five weeks.”
Big Society Capital offered help, working with HMRC for him. But Fountain says the whole process wasn't overly-complicated and worked “astonishingly well”.
Seven investors offered the cash over four years, at 2% a year, and the foundation Resilient Scotland added a further £37,500. Two thirds of the foundation's money is a loan over five years (at a similar rate of interest to the £48,000) and one third a grant.
One of the bakery's social investors, Duane Jackson, is a former prisoner who served five years for drug trafficking. He offered £11,000 after being put in touch with Fountain through an angel investor.
“Promoting entrepreneurship in prisons is something I'm interested in because of my own journey,” Jackson explains. “Before I was released we had a talk from the Prince's Trust and it led to me setting up a very successful accountancy software company. I was later offered a silly amount of money to sell and became open to supporting ideas such as Matt's.
“I felt the money I invested in the bakery had immediate effect. It's great to see what Matt is doing. I hope to be able to recycle the investment into another project.”
Fountain, who turned down a doctorate place at Oxford to do something that felt "more in touch with reality", says the memory of being dependent on his stepfather who couldn't get work because of his criminal record, has stayed with him.
He has a four year contract with the prison service and says the bakery is already exceeding targets. Fountain admits it's been a lot of work so far, but he is buoyed to see the prisoners thriving already.
“One of the guys has developed his own bread over the last few months: a walnut and rye loaf. It's a living testament that this is working, that they feel empowered and more confident, and have a real chance of employment once released.”
Next year, Fountain plans to bring in more social investment, potentially up to £500,000 to further expand the bakery services outside of the prison.
Photo credit: Matthew Herring