'By proving that social enterprises can deliver both social and financial returns we can create an embryonic asset class and a sustainable source of capital to drive social change'
Big Issue Invest CEO Nigel Kershaw
The new £10m Big Issue Invest fund that will offer risk capital to growing UK social enterprises has just announced funding from two big investors.
The National Endowment for Science, Enterprise and the Arts (NESTA) has today announced it will become one of the founding investors in the Social Enterprise Investment Fund with £1m. This follows an investment of £750,000 from the Esmée Fairbairn Foundation.
Big Issue Invest (BII) CEO Nigel Kershaw said: 'I am delighted by the size of NESTA's investment. It clearly demonstrates confidence in who we are, what we do and what we're trying to achieve.
'By proving that social enterprises can deliver both social and financial returns we can create an embryonic asset class and a sustainable source of capital to drive social change.'
The fund, which will invest between £100,000 and £500,000 mostly in established social businesses, will aim to show that social enterprises can improve the delivery of public service. It is likely to use new equity-like investment tools developed specifically for social enterprises.
NESTA CEO Jonathan Kestenbaum said: 'Social enterprises can deliver real growth and services that have the potential to relieve some of the burden currently on the public purse.
'It is a model that NESTA hopes will gain wider support as it offers an opportunity to solve problems that have been unresponsive to conventional solutions and are often financed by the taxpayer.'
The fund will make between 25 and 30 investments with an average investment term of five years. Investors will gain financial returns from the fund which will be generated from a mixture of royalties on the turnover and profit of investees, interest payments and capital gains through equity sales.
Find out more www.bigissueinvest.com
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The Social Enterprise Mark is the brand for social enterprises, helping consumers easily recognise social enterprises that are trading to benefit people and planet. Social Enterprise Mark holders benefit from access to a network of like-minded businesses, exclusive networking events and ongoing support and advice from the Social Enterprise Mark Company. Current mark holders include the Big Issue, Eden Project and the Phone Co-op.
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