WIDENING PARTICIPATION IN SOCIAL INVESTMENTInside Government

grabindrakumar@bigsocietycapital.com

@GeethaBigSocCap

October 2016

ABOUT US

Big Society Capital is an independent financial

institution with a social mission, set up to help to

develop social investment in the UK.

Champion for Social Investment

Wholesale

Social Investor

OUR VISION

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We want to make sure that every charity and social enterprise in the UK can navigate

and find appropriate and affordable finance and support which is accessible and easy

to understand, to grow their positive impact on society.

WHAT IS SOCIAL INVESTMENT?

Social investment is repayable money to help charities and social

enterprises to create even more impact through their work.

ANOTHER TOOL

Trading Donations

Bank

Finance

Contracts/ Payment

By Results

Social

Investment

FINANCIAL TOOLKIT

To build innovation, growth and sustainability

EARLY CONSIDERATIONS

What do you need

investment for?

Is there an income

stream with a

surplus?

What social impact

will you create?

For an asset

Working capital

Bridging finance

To expand

Government contract

Rental income

Membership fees

Donations

Trading

SECURED LOANS

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Emmaus Village Carlton used loans from Charity Bank to pay for

refurbishment of their 15 acre site. It now supports several Emmaus homes as

well as a boutique, a furniture shop and a companion run bric-a-brac store.

WHO ARE SOCIAL INVESTORS?

PhilanthropyTraditional

Investment

Trusts and

Foundations

Individual

Investors

Angel

Networks

Social

Investment Fund

Managers

Social Investment

Social Return Financial Return

FARESHARE SOUTHWEST – TAKING ON SOCIAL INVESTMENT FOR REVENUE GROWTH

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• FareShare South West works with the food industry to reduce the amount of fit-for-

purpose food going to waste.

• The produce is distributed to local organisations working with vulnerable people,

ensuring those in the community that are most in need have nutritious food.

• Fareshare wanted to grow their Surplus Supper Arm Club but did not have the funds

upfront

• They borrowed 70,000 from individuals using Social Investment Tax Relief and

will repay the loan through growth in revenue

WAYS TO WELLNESS SIB

Bridges Social Impact Bond

Fund invests into SIB

Ways to Wellness funds

consortium of 4 local charities

to provide non-clinical services

improving self-care and lifestyle

Reduction in secondary care

usage

Newcastle Gateshead Clinical

Commissioning Group saves

money, plus reduced burden

on services, investors paid

with % of cost savings

SOCIAL PROPERTY FUNDS

By 31st March 2016, the £57m Real

Lettings Property Fund had 226 properties

tenanted, providing fully refurbished homes

for 553 people (including children)

A SHIFTING LENS – MAKING BEST USE OF ALL ASSETS

Charities as

investorsCharities as

investeesSet up a fund to incubate new

interventionsLarge long-term finance

Shaped around

Macmillan’s mission

Capital used to scale

innovative community-

based models that meet

the needs of those with

long-term conditions

CROWD MATCH FUND

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The Crowd Match Fund will

match investments made by

individuals on crowdfunding

platforms into charities and social

enterprises

The £5 million fund will match

investments eligible for social

investment tax relief.

Debt and equity (community

shares)Regulated Social

Sector Organisations

Social Investment Tax Relief

Crowdfunding platform

Crowdfunding platform

Crowdfunding platform

“As with any other aspect of strategy, trustees should feel confident to

make bold and even radical decisions on social investment as long as

they comply with their duties and responsibilities in reaching the

decision and they know they have the information they need.“

Sarah Atkinson, Director of Policy and Communications, Charity

Commission

SUMMARY OF SOCIAL INVESTMENT SOLUTIONS

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Charity Raises Investment

Directly

Investment via Another Vehicle

(not on charity balance sheet)

• Traditional secured loans

• Blend secured/unsecured loan

• Charity bonds

• Social property fund (Dedicated for one charity/client group

or for multiple groups)

Unlikely to be a single solution for all

We believe organisations should have access to a range and combination of options

that best meet their requirements and circumstances

• Unsecured loans

• Grant/loan blend

• Equity-like: social venture funds,

community shares

• Crowdfunding

• Social Impact Bonds

Cap

ital fo

r

Pro

pert

y

Cap

ital fo

r N

ew

Reven

ues

“If you want to do things differently and transform lives in a way

that hasn’t been achieved before, you need the disruption that

social investment creates”