Big changes are needed in how social impact is funded
Progressive philanthropists want their money to go further – and with the most impactful organisations. They understand the importance of giving charities the freedom to use their donations in the most effective way.
Ask any charity CEO what their No 1 problem is and the answer almost invariably will be core costs because finding core funding is the hardest challenge.
Many of them have great business opportunities and ideas but risk-averse Boards, old ways of thinking and a lack of confidence holds back progress.
Charities need to look beyond donations towards more commercial business models, however they need money to invest in diversifying their income streams.
Offer a mechanism for smart philanthropists to make their gift go further – with a focus on building capacity in charities to build new business models.
We plan to work with philanthropists interested in long-term, sustainable social impact. We’ll put their charitable gift into our Social Progress Fund that will enable entrepreneurial charities to pitch for an interest-free loan to help them get their idea off the ground.
We’ll measure our success through the additional income those charities make each year.
Our fund will give charities the support they need to launch effective commercial activity. When their ventures start making money, they repay the loan and share a percentage of their profits ongoing.
We know there are smart, forward thinking philanthropists who understand that allowing charities to use their donations to build long term income is the most effective way to have a real impact, and we’ll be pooling their donations to even greater effect.
- Year 1 Launch two pilot projects with an initial £100k fund
- Year 2 Grow the fund to £500k and launch 2 – 6 additional projects
- Year 3 Grow the fund to £1m. Loan repayments begin
We’re looking for a funding partner to get the Social Progress Fund up and running. To do it properly, we need £250k a year for three years:
£150k on running costs
We need a team capable of identifying great opportunities, and providing in-depth consultancy support (both in-house and external) to ensure the commercial activities have the greatest chance of success.
£100k into the fund
An initial pot to support two pilot projects. We’ve identified two entrepreneurial organisations that have exciting projects that fit the bill.