We know that founders in the Hatch community are committed to doing good and having a social impact through their business, so naturally registering as a Community Interest Company (CIC) is a key consideration early in the journey of launching and growing a new enterprise.
This guide will help you discover if registering as a CIC is the right route for you, and how the process works.
What is a CIC?
A CIC is a special type of limited company which exists to benefit the community rather than private shareholders. It differs from a charity in that it can make profit, and it differs from a standard limited company in that it must invest this profit back into the organisation.
What are the benefits of being a CIC?
Clearly identifiable commitment to social good: recognisable to customers and stakeholders, this adds legitimacy.
Easy to set up: the application process can be completed online in under an hour with a minimal fee.
Limited regulation and liability: less strictly monitored than charities, with comprehensive liability and asset protection.
Access to funding: many funding bodies and private donors will only finance charities and CICs.
We asked Hatch founders what they loved about being a CIC:
Where do I start?
You can access the online portal from the Companies House website or via the link on the CIC Regulator website. The process should take no longer than one hour and costs £27. You will need to upload:
- Your Articles of Association
- A completed CIC36 form
The Articles of Association must contain the statutory provisions from the Community Interest Company Regulations that comply with the Companies Act. Click on the link to find templates which have been prepared with the assistance of lawyers experienced in the social enterprise sector and include all the provisions required by the The Community Interest Company Regulations.
You must decide whether to register as Limited by Shares, or Limited by Guarantee. Over 75% of CICs on the public register are Limited by Guarantee and you can find more information on the difference between the two formats here.
You will need to nominate an asset locked body, which ensures that assets are used for the benefit of the community. You cannot nominate an ordinary limited company, your own CIC, or any of its directors.
Applications are usually approved within two working days.
Business owners in the Hatch community explain why the CIC route was right for them:
Jayni Gudka, Unseen Tours CIC
Sol Escobar, Give Your Best CIC
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