Social Investment Tri borough funding fair 19 th June John Gillespie, ACEVO Diagrams thanks to Big Society Capital

What is social investment? It IS: the provision of finance to generate social and financial returns It is NOT: a grant – there is an expectation of repayment of the finance, plus a return

Why is social investment beneficial? Fills financing gap for innovation and growth, increasing impact. Strengthens governance and accountability Brings in new groups of supporters, and their skills and experience Capital is recycled for onward investment Deeper engagement with social sector and community Helps shape a new responsible form of capitalism For INVESTEES For INVESTORS

Why social investment? Access to finance for small and medium sized charities – on a par with private businesses Broadening investor options to invest in socially useful activity – “twin bottom line” Capital to scale innovative approaches to tackling social problems Support preventative/ invest to save approaches

Different uses Working capital – aka “overdraft” Capital purchase – building or equipment aka mortgage/ hire purchase Development/ growth capital aka student loan/ career development loan

£109m£72m The Social Investment Market

Wider social investment ecosystem OCS Social Incubator Fund(£10m) Big Venture Challenge (>£5m) CO ICRF (£10m) Stage of business growth Commissio ning/reven ue support Secured Loans Unsecured Loans Equity Grant Restricted Grant Social Investment Funds (~£20m) Start up Early GrowthEstablished Type of capital BIG Potential (£10m) BIG Potential (£10m) CO Outcomes Fund (£10m) BLF Outcomes Fund (£40m) Fully or partly funded by government Fully or partly funded by Big Lottery Fund Partly capitalised by Big Society Capital Other Grant programmes from Charitable Trusts and Foundations (>£2bn) Social Banks (~£180m) Tech for Good (£500K)

Social Investment Finance Intermediaries Social Funds General funds Specialised funds Social Lenders Social Impact Partnerships Investment Readiness Results Fund Social Investment Market CIC Social Incubator Fund

Improving sustainability - Greenway Centre “Installing solar panels has enabled us to reduce our operating costs, so our services remain affordable for the whole community”

‘hire purchase’ a mini-bus CAF Venturesome helped a small charity with next to no reserves purchase a mini-bus. Loan paid back over 2-5 years.

SIB Model: To reduce loneliness and isolation amongst older people (in development by Social Finance) Investment in services to reduce loneliness – benefits of reduced service use and improved health outcomes Reduced loneliness SIB SPV Investment into SIB programme Payments represent a % of cost savings Investors Commissioner (eg LA) Delivery programme (could include peer support, group activity, CBT for most isolated) Lead delivery charity Payment metric: Reduction in loneliness -Pressing social need -Engaged commissioner -Complex social outcome to evidence

Tri-borough Commission on Social Investment “the local opportunity” Currently taking evidence Report and recommendations due in August – How to develop the local ecology? – How to increase supply of investment available to local organisations – Perhaps working with local foundations to develop a local fund for tri-borough – Raising money from high net worth individuals ‘crowd funding’

Is social investment right for us? …… Not a replacement for grants or other income.. Do you have an income stream? What level of repayments can you afford? Be clear about what you need it for – working capital, capital purchase, growth capital Can you evidence social impact? What is your appetite for risk (including that of trustees)

Some sources of support Community Assets and Services Grants – up to £10k (pre-feasibility) and £100k (feasibility) - for any org that is looking to deliver a public service Big Potential – up to about £100k for any org that is looking to borrow up to £500k

For more information and contact to tri-borough commission, see