1. Social Investment
Geetha Rabindrakumar
Big Society Capital
grabindrakumar@bigsocietycapital.com
CFG Annual Conference

2. What is social investment?
• Financial returnInvestment
• Financial return
&
• Social return
Social
investment
• Social returnPhilanthropy

4. External developments
• Voluntary sector borrowing increased from £2bn to
£4bn over 10 years (NCVO Civil Society Almanac)
• Future demand c£760m per year (CAF Venturesome
“In Demand”)
• Social investment tax relief
• Commissioners and Social Impact Bonds (SIBs)
• New investor groups – corporates, housing
associations, local authority pension funds
• New funds (e.g. focus on care and wellbeing)
• Crowdfunding

5. BSC vision of market
Improving access to
finance for small
and medium-sized
charities
Building mass
participation in
social investment
Capital to scale
innovative
approaches to
tackling social
problems
Greater financial
scale in the
financing of social
issues

6. BSC role as a wholesaler and
market champion

7. Social Funds
Social Lenders
Investment Readiness
Advisers
Social Impact Bonds
General funds
Specialised funds
Social Investment Finance
Intermediaries

8. 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 Growth Established
Typeofcapital
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
OtherGrant programmes from
Charitable Trusts and
Foundations (>£2bn)
Social Banks (~£180m)
Tech for
Good
(£500K)
Stage of development

9. Early considerations
• What do you need investment for?
o Purchasing/refurbishing assets
o Working capital (e.g. to support payments by results
contract)
o Bridging finance (e.g. confirmed grant)
o Expand existing work/ deliver new services
• Is there an income stream?
• What social impact are you seeking to create?
Organisation Activities Outputs Outcomes Impact

10. Other things to consider
• Risk appetite?
• Predictability of payments?
• Could social investment work alongside
bank finance & donations?

11. Opportunities and benefits of
of engaging social investors
• Charity bonds – broader audience
• Expertise from sector specific funds (e.g.
care, renewables)
• Motivated individuals (e.g. angel
investors – ClearlySo)?
• Contribution of skills and experience
(e.g. through Board seat?)
• Reporting impact

12. Social impact bonds – financial risk
transfer to investors
Eg: 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 savingsInvestors
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

13. Co-developing investment ideas – Real Lettings
L&Q Housing
Association
• £10m social investment into
Real Lettings Property
Fund via L&Q Foundation
• Financial and social
investment
• Mission alignment
Resonance
• Manages Real
Lettings Property
Fund
• Raised £16m initially,
aims to reach £100m
• Fund will buy c220 1-
2 bed flats in London
Broadway
• Homelessness charity
• Charity supports previously
homeless people in private rented
sector
• Leases flats from Real Lettings
Fund
• Supports clients to move on

14. Other ways to be involved with
social investment
• Aligning investments with mission – e.g.
Threadneedle Social Bond Fund
• Partnering with social enterprises to help
deliver mission
• Federated charities – investing in your
networks to scale impact

15. For reference
1) Submit online queries to BSC investment team
http://www.bigsocietycapital.com/ask-us-question
2) Grant support to prepare for investment:
Big Potential http://www.sibgroup.org.uk/bigpotential/
ICRF - http://www.beinvestmentready.org.uk/social-ventures/
3) Sources of funding currently open:
http://www.bigsocietycapital.com/sources-investment
4) Directory of social finance providers and advisers (can filter for
specific requirements):
http://www.bigsocietycapital.com/finding-the-right-investment
3) NCVO guide and tool
http://www.fundingcentral.org.uk/Page.aspx?SP=6059
4) Big Lottery Guide to social investment (summer 2014)