Our investment approach

Making impact investable, scalable, and sustainable

Social purpose organisations struggle to access the capital they need. Impact investors want larger, more sophisticated opportunities but face limited deal flow.

We help bridge this gap. We start with the social issue, then aim to identify the sustainable business models that will create impact and improve people’s lives. We focus on those models that can attract other investors, as ultimately these will scale and have greater impact.

How we work with fund managers

As a wholesale social impact investor, we invest in fund managers. They, and the social social purpose organisations they invest in, create the impact. Our role is to bring the most relevant experts from our network to the table, generating ideas and connecting capital to where it’s most needed.

Market development

We don't wait for perfect opportunities – we help create them. Working with sector experts, we identify promising social business models, then develop the investment infrastructure needed to scale them effectively.
Active partnership

Our role extends beyond capital provision. We bring relevant expertise from our network, facilitate connections with co-investors, and provide ongoing strategic support throughout the investment lifecycle.

What success looks like

By investing our capital, we aim to build a thriving ecosystem which has strong impact-driven fund managers and more available finance from diverse sources.

We measure success by the growth of the entire impact investing ecosystem, not just the direct impact of our investment capital. When fund managers we've backed raise larger subsequent funds from diverse investor sources, when social enterprises access growth capital more easily, and when communities see lasting positive change – that's how we know we're succeeding.

Our investment objectives

Across all our investment activity we have two core portfolio investment objectives:

1

To support our strategic goals and organisational mission to build an investment ecosystem that supports enterprises to improve people’s lives
2

To support our own financial sustainability and deliver our corporate-level net return target of 1% after tax and all costs. This means we target gross portfolio returns of 3-5%

How we allocate capital

We seek to build a portfolio to deliver the greatest impact and systems change while living up to our financial risk-return requirements.

We do this through:

Prioritising which investments to make through our impact and systems change goals, including their ability to crowd in significant capital to scale impact and build the market.
We then size investment allocations to deliver our overall financial goals and diversification of risk factors including liquidity.

Each investment we make contributes in its own way to the portfolio. To ensure we build a balanced portfolio, we invest across three categories of opportunity with different risk-return characteristics:

Seeding

Investing in emerging business models and fund managers to help build a track record to crowd in other capital.
Scaling

Investing in more proven business models and fund managers to scale solutions.
Sustaining

Investing to ensuring the consistent supply of capital to enterprise delivering impactful business models.

We aim to commit £60-80 million each year into new high potential proposals by actively managing our portfolio to meet our drawdown, repayment and financial return targets to ensure the availability of investment over the long term for impact and systems change.