Charities and social enterprises can become so focused on pleasing funders that they lose sight of beneficiaries, a social enterprise conference heard yesterday.

Liam Black, a social entrepreneur who formerly headed Jamie Oliver's Fifteen restaurants, made the comments at the Good Deals conference, organised by Matter & Co.

Black was asked whether there was a problem in the sector with failure not being discussed openly.

He said that part of the reason social bodies failed was because they were not risking their own money.

“In Liverpool we had this revolutionary idea that we would create this concept called Revive, and we blagged £500,000 from the Lottery in the days when just had to turn up in the room and they would hand you a cheque," he said.

“We opened this fantastic store and nobody came because we hadn’t stayed close enough to the people we wanted to help.

"I doubt either we would have let it go on for so long or we would have used £500,000 if we had used our own personal cash."

He said part of the problem with receiving funding from BIG was the risk of becoming tied up with paperwork and losing sight of the core customer and what they wanted.

“We were paying more attention to the people who were giving us the money, and they want you to fill forms in and go to meetings, rather than understanding what was needed,” he said.

Don’t develop a ‘failure fetish’

Black said that he had noticed, particularly in Silicon Valley, people embracing failure too much.

Even though “Google’s law of failure states that 8 out of 10 innovations will fail even when well executed” he told delegates, “you will fail and it is true that if you’re not failing you’re not trying but don’t make a fetish out of it.” And reminded them that funders look for past success when considering applications.

Myth of the hero entrepreneur

 Black also warned of the danger the overhyping individuals in social enterprises and called for more focus on the importance of teamwork.

Launching his new book, The A to Z of Social Entrepreneurship at the Good Deals conference yesterday, Black said that there was a problem with an “entire industry built on the myth of the superhero individual”.

“The idea that any business is created and sustained by one individual person is just a lie,” he added and said that it placed “unreasonable expectations” on social entrepreneurs to live up to high standards.

He said that: “Too much of the social entrepreneur PR industry feeds into this self defeating undermining quality. The danger is when you create a VIP premier league of high performing social entrepreneurs who meet behind the red rope.”

Some of those people are “bullshitters and narcissists” he added.

“The awards culture is great,” he said but that “we really need to inject a big dose of humility” and suggested more awards that recognised teamwork.

“If you want one superpower make it the one to create world class teams.”