Two new social impact bonds seek to raise £8.5m – Charity Financials

Two new social impact bonds (SIBs) have been launched which are hoping to eventually raise £8.5m.

The ‘It’s All About Me’ (IAAM) scheme has been formed by the Consortium of Voluntary Adoption Agencies (CVAA) to help find, train and provide ongoing support to families willing to adopt hard-to-place children. Big Society Capital and Bridge Ventures are expected to put up the first £2m to support a 100-child per year scheme, and if the market expands sufficiently, the bond will be reopened early next year to a wider group of investors in order to raise a further £3.5m.

The bond has been designed to pay a commercial return in order to “make the break from the narrower social investment markets into the the normal investment market”.

In common with most SIBs, private investors will fund the project at the start, before being reimbursed via results payments from local authorities and other public funders. Each local authority will pay around £54,000 per child for the service, which is roughly half the amount it costs to keep a child in care over the same two-year period.

Foundations would be attracted by simpler social investment products, says report

Third Sector

More work needs to be done to ease the concerns of charitable funders, says Dan Corry of New Philanthropy Capital, which released the report

Foundations are being put off social investment because of its complexity and the lack of opportunities, according to a report for charitable funders released today by the charity think tank New Philanthropy Capital.
Best to Invest? A funders’ guide to social investment says that charitable foundations face many barriers to becoming involved in social investment.

It says many funders struggle to understand complex investment mechanisms such as social impact bonds and are worried about whether social investments comply with charity law.

Most foundations outsource decisions to investment professionals who do not understand the structures of the social investment market and are not able to advise charities to put money into investments that are not listed on an exchange, it says