Sometimes it can be feast or famine with SIBNews and today is a real feast! A welcome new California initiative, Roca launch a successful bond to reduce recidivism in New York while in the UK Nesta makes its first investments. Last but by no means least, SIBs are under consideration in Washington state.
Enjoy the read, here is today’s SIB News:
Nonprofit Finance Fund (NFF) and The James Irvine Foundation launched a new initiative today designed to make the “Pay for Success” model a reality in California, with an initial $2.5 million in funding.
The California Pay for Success Initiative will provide flexible funding and expert support to help nonprofit and government leaders structure Pay for Success agreements in California over the next two years. In addition to helping finalize these agreements, the Initiative will nurture a cohort of leaders that will learn from each other and share knowledge as they take Pay for Success from concept to reality.
Nonprofit Finance Fund will select approximately three to eight leaders throughout California to support through an initial round of funding, with additional funding available to these leaders throughout the year. Participants will form an active learning cohort and will have opportunities to share experiences, challenges and results with the goals of further testing the Pay for Success concept and expediting additional Pay for Success agreements. Applications are now open at: http://nff.org/CaliforniaPFS.
Goldman Sachs Buys SIBs
Goldman Sachs and five local and national foundations are investing $18 million as part of an experiment in financing social services known as “social impact” bonds in Roca, a Chelsea nonprofit that tries to keep young men out of jail.
If the nonprofit fails, the investors will lose nearly all their money.
£2m in social investments from Nesta Impact Investments to tackle major challenges facing the UK including; elderly care, education and financial exclusion.
Social investment is set to grow in 2014, boosted by a new tax relief, and entrepreneurs who want to have a social impact as well as making a profit. That’s according to Nesta’s impact investment director, Joe Ludlow, who announced the first social investments, totalling over £2m, from Nesta Impact Investments.
The £25m fund, which is backed by Big Society Capital and Omidyar Network, is investing in organisations tackling issues, such as elderly care, poor educational standards and financial exclusion, that have social impact as well as providing a potential return for investors.
Someday in the not too distant future social service programs in the Northwest could get funding from Wall Street.
The idea is gaining traction across the nation. Goldman Sachs already funds pre-school slots in Utah and a youth intervention program in New York.
A proposal to pilot “pay-for-success” bonds in Washington got a hearing Monday before a legislative committee.