As part of his dissertation, Olof Williamson identified 101 charities to have spiked and then sustained growth of over 100 per cent between 2008 and 2014. He discusses what these charities have in common.

Charity leaders have been caught in a dilemma about how to respond to recession and public sector austerity. Some advocate investing in growth to beat the odds, swimming against the tide of financial pressures. Going for growth can be controversial, with major newspapers and government ministers – as well as charity insiders – critiquing the apparent “big business” culture in charities. High-profile financial failures like that at Kids’ Company raise further suspicions that expansion leads to excessive risk.

However, growth deserves a more balanced perspective, and my recently-completed Masters dissertation looked at how over 100 charities planned for and invested in growth, aiming for the impact and reach that can be achieved through a multi-million pound income.

I identified the 101 operational charities (not funders) that had incomes of over £1m in 2009 and had grown this by at least 100% by 2013, and sustained that growth into 2014. Looking in detail at all these charities’ own documents, I made some striking discoveries:

• The 101 fast-growing charities increased their total incomes from £498m in 2009 to £1,697m in 2013, growing by an average of 293%.
• They increased their share of the voluntary sector’s overall income from 1.05% to 4.2%, meaning by 2012-13 one pound in every 25 of charity income was going to this group.
• Government (whether international, national or local) contributed the most income to 50 of the organisations.
• The rapid routes to growth using public funds included being an academy school provider, providing care and social services under contract with local authorities, and taking on major international projects for DfID and the UN.
• Donations or fees from individuals were the biggest source of income for 41 organisations, which extended their reach to thousands of individual supporters through giving programmes, social enterprise activities or their own lotteries
• Merger was a main reason for growth among 9 of the sample

The documentary evidence was supported by 11 interviews with senior managers and CEOs from the charities, demonstrating the diversity of strategies adopted by the organisations and how they had dealt with the challenges of creating and sustaining growth.

Another pertinent question, particularly for senior managers and fundraisers, was whether the managers had adopted a deliberate strategy to grow their organisation’s operations or income. I came to the conclusion it was roughly 50/50 between those that pursued growth on purpose, and those for whom it was a side-effect of other changes, such as the move to large-scale contracting by local authorities.

These findings do have wider implications for charities as a whole, particularly those who are either uncomfortable with a perceived pressure to get ever bigger, or who are looking to expand and can’t find a way forward. Academia and sector commentary have some aspects of this well covered, but there are also big gaps in both the research and the theory.

Some people will always be uncomfortable that growth most often comes through doing major deals with government or by investing in sophisticated fundraising operations. However this is the way it seems to work, and there is valuable learning in looking at how and why.

Olof Williamson completed an MSc in Voluntary Sector Management at Cass Business School in 2015 and is currently Head of Statutory and Trust Fundraising at Contact a Family.