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Understanding the capacity and need to take on investment within the social sector

The UK social investment market is widely recognised as one of the most advanced in the world. The market continues to grow, Big Society Capital estimate that it is now worth over £1.5 billion, spread over 3,500 investments, with a wide range of products. Government continues to support the market and has committed to strengthening the social investment marketplace by ensuring that future programmes make it as easy as possible for charities and social enterprises to access investment appropriate for them.

This research was supported by the Social Investment Research Council.

A range of support is available for charities and social enterprises of all shapes and sizes who consider taking on social investment. The Access Foundation was established in 2015 to make it easier for charities and social enterprises to access the finance they need to grow and increase their impact. Access is delivering its support through funds that offer grants, run support programmes or make small loans to charities and social enterprises. Direct support to charities and social enterprises is also delivered by Big Potential, a BIG Lottery grant fund aiming to improve the sustainability, capacity and scale of organisations to enable them to deliver greater social impact.

We recognise that social investment is not for everyone. For some charities and social enterprises, other forms of finance may be more appropriate, such as grants or philanthropic capital. While only a minority of organisations in the sector have had the chance to explore social investment so far, the figures from the research suggest that there is a significant number of charities and social enterprises that may be able to seek appropriate investment in the future. The report has also highlights, for the first time, the significant scale of active social companies that may be interested in investment to increase their impact. Whilst some of this investment may be made by traditional lenders, social investors can offer valuable support those who are unable to access bank finance or need alternative finance types to complement other funding sources.

The data on assets and liabilities of charities and social enterprises used in this report is a step forward in understanding the true potential scale of the opportunity for social investment. We hope that through making this dataset open, we will encourage researchers, investors, advisers as well as other charities and social enterprises to investigate this data further to help connect them to the appropriate investment they need.

Last updated | 
27 April 2016