What thirteen years of lending has taught us about enterprise, poverty and potential.
Richard Kirtley, Aug 07, 2026
For much of the past few weeks, we’ve been doing something that, if we’re honest, doesn’t sound particularly exciting. We’ve been poring over spreadsheets, checking repayment histories, mapping application journeys, reviewing borrower characteristics and analysing every loan we’ve made under our new lending model since 2024. It wasn’t a compliance exercise, nor was it an attempt to find a few attractive statistics for an annual report. We set out with a much bigger question in mind. After thirteen years of lending to people who have been excluded by mainstream finance, did we finally have enough evidence to answer the question we’ve been asked more than any other? Does the Purple Shoots model actually work? We have always believed the answer was yes. We have seen lives transformed, businesses flourish and confidence restored. But belief, however deeply held, is not enough. If we are asking philanthropists, foundations, governments and impact investors to back a fundamentally different approach to enterprise finance, then our case must be built on evidence rather than instinct. We wanted the data to tell the story, even if that story challenged some of our own assumptions.
What emerged from that analysis has been one of the most encouraging pieces of work we’ve ever undertaken. It hasn’t simply strengthened our confidence in what Purple Shoots does; it has fundamentally changed how we think about the organisation itself. For years we’ve described ourselves as a micro-enterprise lender, and technically that’s true. We provide affordable business loans to people who are unable to access finance elsewhere. But the loanbook suggests that lending isn’t really the point. Lending is simply the mechanism. The real work of Purple Shoots is restoring agency. It is helping people who have been told (sometimes explicitly, sometimes implicitly) that enterprise isn’t for them, to discover that they can build something of their own. That they can generate income, contribute to their communities and create a different future for themselves and their families. We don’t simply fund businesses. We invest in people.
One of the biggest assumptions in modern finance is that financial exclusion is a reasonable proxy for financial risk. If somebody has poor credit, receives benefits, has experienced long-term unemployment, lives in a deprived community or has previously been declined by other lenders, then the market quietly concludes that lending to them is unlikely to end well. Nobody says it quite so bluntly, of course. The decisions are wrapped in algorithms, affordability models and risk assessments. But the outcome is the same. Thousands of people with the determination and ability to build businesses never get the opportunity because the system has already decided they represent too great a risk. That assumption has become so deeply embedded that very few people stop to question it. We decided to question it.
Our loanbook paints a remarkably different picture. More than half of the entrepreneurs we have supported under our new lending model live in the three most deprived deciles in England and Wales. Many were receiving benefits when they applied. Many had experienced unemployment. Almost half had either already been rejected by another lender or advised not to apply because they were considered unlikely to succeed. These are not borrowers who happened to slip through the cracks of the financial system. These are precisely the people the financial system has chosen not to serve. Yet when we looked beyond the stereotypes and examined what actually happened after they received affordable finance and ongoing support, the story became far more hopeful than conventional wisdom would suggest.
Perhaps the most striking thing about our analysis is that it forces us to rethink what risk actually means. Too often, risk is treated as something inherent within an individual. Poor credit becomes evidence of poor character. A period of unemployment becomes evidence of low capability. Living in a deprived community becomes evidence of limited opportunity. But those assumptions confuse circumstance with potential. They measure what has happened to someone rather than what they are capable of achieving. Purple Shoots has always tried to make that distinction. We have never ignored risk, we are, after all, an FCA-regulated lender, but we have always believed that understanding a person’s circumstances provides a much richer picture than a credit score alone. The loanbook suggests that this belief isn’t simply compassionate. It is commercially and socially sensible.
That conclusion has profound implications, not just for Purple Shoots but for the wider economy. If people who have been excluded from mainstream finance can build sustainable businesses when given the right combination of affordable lending, practical support and belief, then perhaps we have been underestimating one of the country’s greatest untapped economic assets. We spend enormous amounts of time discussing productivity, growth and entrepreneurship, yet comparatively little attention is paid to the thousands of people who possess entrepreneurial talent but have simply never been given access to the financial tools needed to demonstrate it. We often talk about unlocking investment in infrastructure, technology and innovation. Perhaps we should spend more time talking about unlocking investment in people.
There is another lesson hidden within the data that resonates deeply with us. Success does not appear to come simply from providing capital. If that were true, mainstream lenders would already be serving this market. The distinguishing feature of Purple Shoots has never been the money itself. It has been the relationship that accompanies it. We take time to understand our borrowers. We work with them before the loan is approved. We continue supporting them afterwards. When businesses succeed, we celebrate. When life becomes difficult, we don’t disappear. We adapt, support and help borrowers find a route back to stability. Traditional finance often views a loan as a transaction. We have always viewed it as the beginning of a relationship. Looking back over the evidence, we increasingly believe that relationship is one of the key reasons the model works.
That matters because the outcomes extend well beyond individual businesses. Every successful entrepreneur creates value that ripples far beyond their own household. They earn an income. They spend locally. They support suppliers. They create confidence within their families. They reduce reliance on benefits. They pay taxes. They contribute to the communities in which they live. Using recognised economic modelling, we estimate that every pound invested through Purple Shoots generates approximately £4.20 in return to HM Treasury and around £14.25 in economic value within local communities. Those figures are encouraging, but perhaps more importantly they remind us that investing in financially excluded entrepreneurs should never be viewed simply as an act of generosity. It is an investment in economic participation itself. When people are given the opportunity to contribute, society benefits alongside them.
This analysis has therefore changed the conversation within Purple Shoots. Previously, we spoke primarily about the work we had already done. Increasingly, we find ourselves talking about what could become possible if this model were available at a much greater scale. That is why we have begun developing the Purple Shoots Opportunity Fund. Our immediate ambition is to establish a £1 million blended finance fund that combines philanthropic funding, social investment and revolving lending capital. Part of that investment will strengthen our ability to support entrepreneurs. Part will provide a guarantee that unlocks additional investment. The remainder will become affordable business loans for people who would otherwise remain excluded from enterprise finance. It is an ambitious step, but it is one grounded firmly in evidence rather than aspiration alone.
What excites us most, however, is not the funding target itself. It is what the fund represents. For years, Purple Shoots has quietly been proving that there is another way to think about enterprise finance. The Opportunity Fund is our invitation to others to help take that idea further. We believe there is an opportunity to demonstrate that philanthropy and investment need not be competing approaches. Together they can create a sustainable platform that recycles capital, supports entrepreneurs year after year and fundamentally changes who gets the chance to participate in our economy. That feels like a much bigger ambition than simply growing an organisation. It feels like the beginning of a different conversation about financial inclusion itself.
The more we studied our loanbook, the more one sentence kept returning to us. It became impossible to ignore because every table, every case study and every statistic pointed in the same direction. The issue isn’t capability. It’s access. We have spent thirteen years believing that to be true. We now have stronger evidence than ever that it is. And if that is the case, then one of the greatest opportunities facing philanthropy and impact investment over the coming decade is not creating entrepreneurs from scratch. It is finally investing in the entrepreneurs who have been there all along, waiting for someone to see their potential rather than their past.