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BLOG:Social Entrepreneurs: the NDIS needs you!

23 October 2014 at 10:19 am
Xavier Smerdon
The NDIS will create a once-in-a-lifetime opportunity for entrepreneurs, social entrepreneurs and impact investors who want to improve the lives of people with a disability says Impact Investing Manager at Social Venture Australia Alex Oppes.

Xavier Smerdon | 23 October 2014 at 10:19 am


BLOG:Social Entrepreneurs: the NDIS needs you!
23 October 2014 at 10:19 am

The NDIS will create a once-in-a-lifetime opportunity for entrepreneurs, social entrepreneurs and impact investors who want to improve the lives of people with a disability says Impact Investing Manager at Social Venture Australia Alex Oppes.

The National Disability Insurance Scheme is Australia’s biggest social reform since the introduction of Medicare almost 40 years ago.

It will impact the disability sector in three ways:

1.     Improve the lives of people with a disability by giving them greater control over their care

2.     Boost the funding to disability services from $8.7bn p.a. in 2013-14 to $20.5bn in 2019-20 once the Scheme is fully rolled out (15% compound annual growth; with even higher annual growth in latter years).

3.     Change life for service providers: people with a disability will become consumers able to vote with their dollar and providers will be forced to adapt and improve their business models

Ripe for disruption

The disability sector is ripe to be disrupted by social entrepreneurs who can offer better services at lower costs.

The dynamics of the sector present a once in a lifetime opportunity, as indicated by a recent KPMG review:

  • Incumbents are ill-equipped to transition to the NDIS. The current market is fragmented and dominated by relatively small Not for Profit operators. Anecdotal evidence suggests that some providers will not even attempt to transition to the new system. Even existing, large providers have indicated they will struggle to deliver support services at the ‘efficient price’ set by the NDIA.

  • Potential new providers have been slow to crowd in, including large, national providers from adjacent industries like aged and health care.

These challenges should signal opportunities for social entrepreneurs.

Social entrepreneurs: NDIS needs you!

The Government has created the market, so now it is time for entrepreneurs to fill in the details. Social enterprises and businesses are required in areas ranging from personal supports and care, assistive products and equipment, to transport and home modifications.

Perhaps most importantly, we need social entrepreneurs to establish organisations that enhance the social and economic participation of people with disability – objectives of the NDIS that are essential to people with disability achieving independence and the Scheme staying on budget.    

What does the ideal entrepreneur look like? The ideal NDIS entrepreneur will combine a broad range of skills – the service provider (supporting people with a disability), the retailer (customer facing), the tech whiz (able to grow technology enabled, scalable businesses) and the diplomat (skilled in government relations).

But most importantly, what’s needed is people with lived experience of disability – people who truly understand the needs of the Scheme’s participants and who can provide innovative and more efficient services.  

In March2015, the School for Social Entrepreneurs (SSE) will launch NDIS Accelerator, Australia’s first enterprise-based learning program to support disability organisations to develop market orientated, client focused business models in response to the opportunities the NDIS presents.

Australia’s own venture capital market

The NDIS has the potential to boost Australia’s own venture capital market. It has all the hallmarks of venture capital: highly scalable business models, disruptive environments, rapidly growing markets and the potential to makes lives better.

Whilst the Government has provided seed capital to a number of providers through grant programs, there has been very little investment in the sector by private investors to date. Few notable deals have been struck, there has been limited media coverage and the investment community’s understanding of NDIS is still minimal. What’s needed is specialist venture capital-style impact investors.

Like successful NDIS entrepreneurs, pioneer investors will need several unique traits:

  • Experience straddling both the business sector and the social sector

  • Intimate knowledge of the NDIS and Government policy

  • A track record of scaling innovative social enterprises

The potential payoffs to early impact investors are high – from those looking for financial return to those looking for social impact.

·         On the social side, investors can help guide social enterprises that will make life significantly better for people with a disability, either by offering services of a higher quality than previously available; offering a new service which was previously unavailable; or offering services for less, enabling NDIS budgets to stretch further.

·         On the financial side, the tailwinds will be strong: access to a $20bn+ market in Australia 2019-20.

Longer term, the opportunities in Australia’s region are even bigger: Australia has been successfully “exporting” education to Asia for decades, and increasingly health care and biotech expertise.

With an increasingly wealthy and ageing population on Australia’s doorstep, early movers in disability care are well positioned to be able to translate successful business models to a much, much broader market.

About the Author: Alex Oppes joined SVA’s Impact Investing team in 2013 and is responsible for investing SVA’s Social Impact Fund, in particular identifying opportunities and conducting due diligence. He is also assisting in the development of new impact bonds and SVA’s Housing Strategy.

Prior to SVA, Oppes worked as a strategy consultant at McKinsey & Co. across Australia, Asia and Europe, specialising in due diligence for major mergers and acquisitions. He has also established a small retail business and consulted extensively in the Not for Profit sector. Oppes holds a dual BA/LLB (Hons) from the University of Melbourne, where he studied as a National Scholarship holder.


Xavier Smerdon  |  Journalist  |  @XavierSmerdon

Xavier Smerdon is a journalist specialising in the Not for Profit sector. He writes breaking and investigative news articles.

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