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Bridges Social Impact Bond Fund

Fund size | £
Big Society Capital investment | £

Bridges Fund Management

Finance for social sector organisations to improve social outcomes through payment-by-results contracts.

Social impact 

Government is increasingly moving to a system of commissioning for outcomes for challenging social issues such as homelessness, children in or on the edge of care, youth unemployment and the at boundary between health and social care. Charities and social enterprises often need upfront working capital to deliver these contracts. Charities and social enterprises often need upfront working capital to deliver these contracts. The Bridges Social Impact Bond Fund was set up provide this.

As payments are made on the basis of defined social outcomes, each investment the fund makes will clearly specify a set of target social outcomes. These will be monitored and measured through each investment. Methods of evidencing indirect, secondary or unexpected social impacts are likely to progress further over the life of the fund.

Financial rationale 

The fund makes provides working capital to charities and social enterprises delivering payment-by-results contracts. Any return to investors is directly aligned with the positive social outcomes achieved through those contracts.

Market development

The fund is the first of its kind in the world and has the potential to be game-changing to help more social sector organisations bid for and deliver payment-by-results programmes (contracts which until now have been delivered almost exclusively by private sector organisations with large balance sheets). As well as giving charities and social enterprises the financial support to bid for contracts, the fund will provide social investors access to opportunities that meet their social and financial priorities and provide a degree of diversification across several investments. The team managing this fund at Bridges will be an important voice in the continued development of this part of the social investment market.

Investment details

  • Fund size: £22.5 million 
  • Big Society Capital investment: £10 million
  • Co-investors: Omidyar Network, Panahpur, European Investment Fund, Great Manchester Pension Fund, Merseyside Pension Fund, Deutsche Bank, The Prince of Wales’s Charitable Foundation, Trust for London, The Highwood Foundation
  • Arranger/Manager: Bridges Ventures
Last updated | 
20 January 2016