Launch of the Bridges Social Impact Bond Fund

29th April 2013

■ First fund of its kind, it will provide investment and support to charities and social enterprises to deliver social outcomes-based contracts ■ Bridges Ventures (Bridges) and Big Society Capital have today announced the launch of the Bridges Social Impact Bond Fund. The first of its kind, the fund will invest in charities and social […]

■ First fund of its kind, it will provide investment and support to charities and social enterprises to deliver social outcomes-based contracts ■

Bridges Ventures (Bridges) and Big Society Capital have today announced the launch of the Bridges Social Impact Bond Fund. The first of its kind, the fund will invest in charities and social enterprises to deliver programmes designed to improve social outcomes in areas such as education, employment, housing and care for vulnerable young people.

The new £14 million fund will be managed by Bridges with Big Society Capital acting as cornerstone investor alongside the Bridges Social Entrepreneurs Fund, Omidyar Network and Panahpur.

Charities and social enterprises play a crucial role in addressing tough societal challenges and providing life-changing support to the most vulnerable.  However, philanthropic capital is not enough to scale up the work of these organisations driving a growing need for new and sustainable funding sources for social sector organisations.

The government is moving increasingly to payment-by-results (PbR) commissioning, where public sector commissioners commit to a Social Impact Bond which pays for improvement in social outcomes.  Social investors can provide the required up-front funding for new interventions and services delivered by charities and social enterprises, knowing their returns will only be made if the intervention achieves specific improved social outcomes.  Examples of such programmes are: working with vulnerable children to improve educational attainment, and developing a specialist foster care scheme to help more children to transition from residential care homes.

The Bridges Social Impact Bond Fund aims to be a sustainable source of funding and support for social sector organisations delivering social outcomes-based programmes. The new vehicle is part of the £56 million investment commitments announced by Big Society Capital since its launch in April last year.

The new fund will be managed by the team behind the Bridges Social Entrepreneurs Fund which has built strong credentials in working with social enterprises delivering government contracts. Last year the Bridges Social Entrepreneurs Fund led investments in three payment-by-results programmes under the Department of Work & Pensions’ Innovation Fund, and was also lead investor along with Big Society Capital in the UK’s first local authority Social Impact Bond, commissioned by Essex County Council to deliver an intensive support programme for vulnerable adolescents at risk of going into care.

Bridges will work with a diverse network of commissioners, delivery organisations, intermediaries and advisers to ensure it can assess the best opportunities for the new fund, as well as supporting charities and social enterprises in the bidding process. In addition, the team will draw on its well-established IMPACT methodology for regularly measuring the social impact of the portfolio.

Antony Ross, Partner and Head of Social Sector  Funds at Bridges Ventures, said: “We are delighted to be managing this pioneering fund, which we believe should play a catalytic role in the way social sector organisations are financed in the future. The fund will provide charities and social enterprises with a much needed sustainable source of capital and support, allowing them to focus on delivering crucial social outcomes-based programmes that will benefit society as a whole.”

Nick O’Donohoe, CEO of Big Society Capital, said: “This fund provides a new opportunity to invest in a professionally managed, diversified portfolio of payment-by-results contracts delivered by social sector organisations. Going forward, Bridges will be able to provide a unified voice for investors in the development of payment-by-results commissioning to help level the playing field for social sector organisations.”

Contact information

Bridges Ventures

Hannah Randall – Capital MSL

Hannah.randall@capitalmsl.com

0207 255 5177

Big Society Capital Alastair Ballantyne – Head of Communications

aballantyne@bigsocietycapital.com

020 7186 2503

Notes to Editors About Bridges Ventures Bridges Ventures LLP (“Bridges Ventures”) is specialist fund manager dedicated to using an impact-driven investment approach to create superior returns for both investors and society at-large. It was established in 2002 with a mission to use its commercial expertise to achieve focused social or environmental benefit, as well as attractive returns for investors. Bridges Ventures has raised seven funds to date which total almost £300m: Sustainable Growth Funds I, II and III, the Bridges Sustainable Property Fund, CarePlaces Fund, Bridges Social Entrepreneurs Fund and Bridges Social Impact Bond Fund.

About Big Society Capital Big Society Capital is the world’s first social investment bank. BSC formally launched in April 2012, with an estimated £600 million of equity to be paid-in over 5 years, of which £400 million will be from unclaimed assets left dormant in bank accounts for over 15 years and £200 million from the UK’s largest high street banks. Big Society Capital seeks to support the growth of a social investment market in the UK by revolutionising the way in which the social sector is funded. Through supporting the growth of social investment finance providers, BSC will improve access to innovative forms of financing, and connect the sector to capital markets.

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