Social enterprise

Olsen Verlag is a social enterprise. This means that we are a trading company rather than a charity, which means that we buy and sell things for profit. However, our fundamental purpose is not to make money for shareholders. Instead, our fundamental purposes are to bring music to more people and to help musicians, especially young musicians.

On this page you can read more about what it means for us to be a social enterprise and how we differ from other businesses in the classical music industry.

We are happy to be very transparent about our corporate structure and approach to business. We hope that this information is of interest, especially to young musicians who have an interest in business.

What is a social enterprise?

Unlike a charity, there is no precise or legal definition of what makes a social enterprise, and social enterprises take many forms. As a matter of law, Olsen Verlag (UK) Limited is a private company limited by shares, meaning that legally it is no different from any other private limited company.

The difference lies in our fundamental purposes, and certain corporate policies we have.

Why does a company exist?

Ordinarily, a company exists to create ‘shareholder value’. What does that mean? In its most conventional form, this involves a company making profits, and distributing those profits to shareholders in the form of dividends.

However, not every company operates in this way. In order to accelerate its growth, a company may reinvest what would be its profits in order to expand its operations, and therefore remain unprofitable. There are plenty of companies, especially in the tech era, which have been so fixated on growth that they have waited for years before making a profit (and this growth is typically fuelled by vast amounts of debt). In this case, the ‘value’ created for shareholders is not so much a dividend as the prospect of a dividend one day. That future prospect of a dividend is what makes a share in that company valuable.

Why is Olsen Verlag different?

Olsen Verlag does not exist to create ‘shareholder value’. This is for the simple reason that James did not set it up for this purpose. James started Olsen Verlag in 2017 to publish and promote his music, and the commercial rationale for this was that, if the company did its job effectively, James could focus more on composing, which would benefit him commercially. So there was no need for Olsen Verlag to benefit him commercially as well.

Olsen Verlag’s corporate structure

Olsen Verlag (UK) Limited is the full name of our company, and is registered in England and Wales. Like any company registered in England and Wales, you can search for it on the Companies House website and find out various bits of information which are a matter of public record. You can have a go here.

At present there are 100 shares in the company and they are all owned by James, our founder and director. That means that, as a matter of law, James has complete control of the company and, if he wished, could liquidate the company. He promises that he has no intention to do this at present, which we are glad about!

So what is Olsen Verlag’s purpose?

Olsen Verlag has two fundamental purposes:
  1. To bring music to more people
  2. To help musicians, especially young musicians
In order to achieve these purposes, we reinvest all our profits so that we can do more work. We don’t plan to pay any dividends to our shareholder, which means that we can spend all the money we make on developing new projects.

You can read more about our fundamental purposes and values here.

Our corporate policies

At present, we have the following four corporate policies which together make our company different from an ordinary trading company:
  1. We have no equity finance
  2. We have no debt finance
  3. We do not pay dividends
  4. We reinvest all our profits
1. We have no equity finance

‘Equity finance’ is a way of funding a business where an investor puts money into the business in return for having an ‘equity stake’ in that business. Put simply, that means that the investor has a right to future profits of that business.

This is how shares in a company work, and it is also true for other businesses such as partnerships. We will use a company as an example. Imagine that Joseph, Wolfgang and Ludwig decide to start a barbers’ shop together. They form a company and agree to put the following amounts into the company to get it started:

Joseph: £2,000
Wolfgang: £5,000
Ludwig: £3,000

They each get a share in the barbers’ shop for each pound they put in. That means that they each on a share of the company’s equity, and are all equity investors. They own the business in the following proportions:

Joseph: 20%
Wolfgang: 50%
Ludwig: 30%

Imagine that, after the first year of roaring trade, the barbers’ shop has made £50,000 profits after tax. The company decides to pay those profits to the shareholders as a dividend. The profits would be distributed proportionally as follows:

Joseph: £10,000
Wolfgang: £25,000
Ludwig: £15,000

Commonly, an equity investor not only has rights to dividends, but also has control over the company in the form of voting rights, and a right to a proportion of the company’s assets if the company is wound up.

What this means for Olsen Verlag

The above example is a simple one. For a relatively new company like Olsen Verlag, in practice an equity investor would normally take the form of an angel or private equity investor. Such investors take a stake in the business and, in return, offer some form of guidance or input.

Olsen Verlag has no such investors. This is because we are committed to remaining independent. If a company has equity investors, it effectively has a boss, and we don’t want that. You might say this is arrogant of us: a lot of businesses are keen for external investors so that they benefit from more experienced business people. That may be the case, but we would rather go it alone.

2. We have no debt finance

Debt finance is the opposite of equity finance. Whereas an equity investor gets a share in a business’s profits, a debt investor does not. Instead, they lend a business money and in return expect to receive interest on their loan.

Imagine that, in our previous example, the three barbers decided that, to supplement the money they put into the business, they would also take a £50,000 loan from Gioachino Bank in order to open a much larger barber’s shop. The interest rate on the loan is 15 per cent.

After the first year of trade, the company has £70,000 profit. Out of this, they must first pay interest of £7,500 to Gioachino bank, leaving £62,500 to distribute between the three shareholders. Clearly this is a good deal for everyone.

However, imagine that the barber’s shop wasn’t so successful. If it only made £10,000 profit in the first year, there would only be £2,500 to distribute between the shareholders.

Crucially, debts are paid before anything can be paid to shareholders. If a business fails, debts are repaid out of whatever is left in the business, which is why equity investors are often left with nothing. Debts are often ‘secured’ against an asset, meaning that the debt must be repaid when that asset is sold. (An example of this is a mortgage: the loan from the bank is secured against the house.) In general, equity investors take more risk, and in return can enjoy the benefits of a company’s success. Debt investors take less risk, especially with a secured loan, but they do not enjoy so many benefits because their return (the interest payable on a loan) is fixed.

Of course this is all a big generalisation. Interest rates may not be fixed, and there are some peculiar forms of investment out there which combine aspects of equity and debt, but that’s not important for now.

What this means for Olsen Verlag

In a sense, a debt investor also exercises a form of control over a business. A bank or other lender generally does not offer the input of a private equity or angel investor, but they still can call the shots in that, firstly, in order to get the loan the company has to jump through certain hoops required by the lender. Secondly, by borrowing money you are then answerable to your lender. Ultimately, if a business fails and has outstanding debts, whoever owns those debts controls the business.

Olsen Verlag is committed to remaining independent. It is our policy not to take on any debt, which means that no one can tell us what to do. The downside of this is that we have to go slowly: borrowing money is a great way to get a business moving quickly. However, going slowly is one of our core values, and we also think that operating within our means has been a great way to develop a sustainable business where we don’t just burn cash like there’s no tomorrow. Going debt free has forced us to be prudent with our resources.

3. We reinvest all our profits

If we have no equity finance and no debt finance, where does Olsen Verlag get its money? The answer is simple: we are funded entirely by our profits. Clearly this means that the speed of our growth has been limited. If we took a loan, we would have the firepower to do a lot more. However, James made the decision that it was preferable to grow slowly and steadily, and within our means.

Olsen Verlag’s primary business so far has been representing James as his agent. As with most agents, James pays a proportion of his earnings as a composer to the company, and in return we carry out work to promote his music and generate more work. We have carried out project management for James’s composing projects, which has included digital marketing and fundraising.

We have had a number of other sources of revenue. We do some video production work for clients, and for some of James’s projects we have sold merchandise, for example the German School London project which you can read about here.

4. We do not pay dividends

Linked to this is our policy not to pay dividends. Why not? The simple commercial reason is that James does not need them. If Olsen Verlag does its job, James will receive more composing work. Plus, James pays a proportion of his composing income to the company, it makes little sense for him then to take it out again in the form of dividends.


The above policies are not set in stone and, because our company is still relatively new, we may rethink them in the future. For example, if we have a specific reason for taking on some debt finance, we may consider doing so in a prudent manner.

But what will never change are our fundamental purposes: to bring music to more people, and to help musicians, especially young musicians. We will never exist solely to create shareholder value.