Back in 2018, Alex Stephany took to the TEDx stage in Brighton, UK, to present his new company, Beam. Stephany wasn’t hawking a new social network or AI-powered productivity software. His new company was, he said, “the world’s first crowdfunding platform to support homeless people.”
Stephany, former CEO of parking app JustPark, told his audience: “If we are to build a society where anyone can achieve their potential, we need to do that person by person.”
Beam’s early premise was to set up individual crowdfunding pages for unemployed and homeless people, allowing members of the public to fund training and qualifications.
It later expanded into lucrative contracts with local authorities across the UK, under which it agreed to find housing or jobs for a set number of homeless individuals within a specific timeframe. In most cases, Beam classes a successfully-housed individual as one that has signed a tenancy agreement and an employed individual as one that has 16 hours of paid work per week.
Since launching, Beam, a VC-backed startup that has raised £9m in total, including £4.5m just last month, according to Companies House, says it has helped 1,474 people into work and 625 people into tenancies that last more than six months.
It has won endorsements from the Mayor of London, Sadiq Khan, and partnered with major homeless charities including St Mungo’s and Thames Reach. It has also secured millions of pounds worth of contracts from government departments, including the Department for Work and Pensions and the Ministry of Justice. Other contracts include housing refugees from Ukraine and Afghanistan.
But an investigation by Sifted suggests that Beam is struggling to meet its targets with council contracts up and down Britain, with only a tiny fraction of homeless and unemployed people referred to Beam by councils actually finding work or housing via the company. As a result, a number of councils have opted not to renew contracts with Beam.
Sifted reached out to 55 local authorities that have or have had contracts with Beam, with 20 providing information. Sifted has applied under the Freedom of Information Act to the other 35. Of the 20 councils that responded, 13 revealed the cost of their contract; together they total £1.1m.
The responses Sifted has received paint a stark picture of how Beam’s contracts with local councils — many of which are ongoing — are performing. In numerous cases, contracts worth tens of thousands of pounds have resulted in just one or two individuals being housed. Early results in others were so low that Beam has had to extend contracts at no extra cost to the local authorities involved.
At least 10 local councils have seen contracts worth between £30k-200k result in single digit ‘outcomes’, which both Beam and councils use as shorthand for someone finding accommodation or employment.
Conwy Council in North Wales stopped working with Beam after seeing just one outcome in a year. In Swale, Kent, an annual contract worth £80k has seen two people housed, while in Chichester, West Sussex, an annual contract worth £47.5k has seen one person housed. As a result, both contracts have been extended by Beam: Swale’s contract until February 2024, and Chichester's until March 2024.
They pick the successes and dismiss the others.
Ashford, Kent, revealed under an FOI request that Beam was contracted to work with 30 families, and after 105 one-on-one meetings with households, just five families secured tenancies. Ashford said that just three are still in housing, and it is not renewing its contract. Ashford paid Beam £105k for the contract, which ends November 2023.
In a statement to Sifted, Beam said: “Beam is a growing social impact startup, dedicated to transforming the lives of society’s most disadvantaged and marginalised people. Our innovative services are trusted by councils to deliver significant positive change in communities around the UK, and the stories of the countless lives we’ve touched speak volumes.
“What constitutes 'success’ may range by council as each community has unique circumstances and needs, which impacts our programmes. We set targets and carefully adapt our approach in close partnership with the council. Where we haven’t met our targets, as the true impact of our efforts often materialises towards the end of a contract, we have always offered to extend our work without any extra charge.
“Our partnerships not only transform the lives of thousands of people, but also realise millions of pounds of savings for councils and their residents, from temporary accommodation costs to council tax. We are proud to have helped over 2,700 people and their families change their lives.”
London’s homeless population is estimated at more than 10k and increased 54% between 2013 and 2023, recent data reveals. As councils up and down the UK face swelling bills for temporary accommodation amid a national housing crisis, homelessness is set to be a key electoral issue in the 2024 national elections and Khan’s bid to win another term as London mayor.
Beam has signed contracts with a slew of London councils, including Haringey, Hounslow, Hammersmith and Fulham, Camden, Islington, Newham, Kensington and Chelsea, Westminster, Wandsworth and Tower Hamlets. Most of these councils refused to comment on their contracts with Beam, and Sifted has requested the information under the Freedom of Information Act.
Ultimately Conwy and Beam came to the mutual decision that the service was not a good fit.
One of the few London boroughs to provide information to Sifted was Camden, which confirmed that it has signed contracts worth £174k with the startup. Sifted understands that the contract is worth £60k per year for two years, with an extra £27k paid to Beam per year if it successfully houses 30 people annually. So far, Camden told Sifted, six people have found housing since the contract was signed in January 2023.
Newham Council told Sifted that since its contract with Beam began in January 2020, 434 people have been referred to the startup and 45 people had started work. A total of 68% remained in paid employment after 13 weeks, “which is particularly high given the complex needs of the cohort,” a council spokesperson said. It’s a rolling contract worth £20k per year.
Tower Hamlets told Sifted that between 2021 and 2022 it referred 167 households to Beam in a contract worth £40k. Beam agreed to get 27 households into paid employment but succeeded in finding work for just nine. Tower Hamlets did not renew the contract.
‘They pick the successes’
In all the council contracts seen by Sifted, there is a significant deficit between the number of referrals from the council to Beam and the number of people that end up being assigned a case-worker. This is because Beam will not work with individuals who have problems with drugs and alcohol as well as mental health issues, two current employees of Beam told Sifted. In some contracts it will also not work with individuals who have no legal right to work in the country.
Both employees told Sifted that the company too often dismissed candidates it deemed harder to support, taking in more referrals than the number they eventually chose to work with.
“They pick the successes and dismiss the others,” one employee said, alleging that Beam dismissed candidates with more “complex needs like drug and alcohol use or certain criminal convictions.”
A source within a public body that contracted Beam said they felt the same. “They say they will help 10 people and help the first 10 they talk with. But instead, they talk to 50 and pick the 10 most likely to be easy to help,” the source said.
Beam declined to comment beyond its statement.
Despite the results so far, a number of councils told Sifted that they would continue to work with Beam. In a statement, a spokesperson for Chichester Council said that its work with Beam had resulted in more homeless individuals engaging with the council in general.
“Like other councils across the country, the challenges that we face around the issues of homelessness are not unique to us, and we continually seek to work with landlords to improve access to the private rented sector,” it said.
Conwy, in a statement to Sifted provided by Beam, said: "Beam and Conwy Council worked [...] collaboratively to adapt the Beam service to the needs of local residents, and during this time over 60 people had access to caseworker support and one person was supported into employment.
“Due to both an increasingly challenging rental and employment market and the complex needs of residents — the programme was unable to support higher numbers of people. Ultimately Conwy and Beam came to the mutual decision that the service was not a good fit for the priorities of the local area right now. If this changes in the future then we would revisit.”