Supporting responsible businesses to find the capital to grow
There are many innovative and pioneering social sector organisations developing solutions to major social problems. Some have the potential to scale up their activities and increase their social impact, but lack access to the right finance to do this.
There are also many investors interested in investing in social purpose businesses such as the trading arms of charities or social enterprises for a blended social and financial return. However it can be hard to find the right organisations to invest in.
Big Society Capital has committed to invest £850,000 into the Social Stock Exchange, alongside a further £1.35m from Panahpur and the Joseph Rowntree Charitable Trust.
The Social Stock Exchange (SSE) will provide a regulated platform for investors to invest in social purpose businesses – an essential part of the market infrastructure that connects socially motivated investors with organisations in need of capital. It will list and facilitate the trading of securities in businesses that address social challenges such as social enterprises.
Its goal is to be an FSA-authorised Recognised Investment Exchange. This authorisation and regulation will allow institutional investment participation and unlock investment from charities, family offices, trusts and foundations and private investors.
Unlike other stock exchanges, the SSE will not derive any income from trading: its focus is to facilitate capital-raising on long term shareholding and not the creation of a short term trading environment.
The Social Stock Exchange is an important part of the infrastructure needed for the development of a social investment market in the UK and globally.