Covid-19 has impacted marginalised communities the hardest and laid bare the structural inequalities that exist across the UK. Diverse-led charities and social enterprises offer some of the best solutions to tackle poverty and inequality and are well placed to reach left behind communities. However, these organisations have been historically underfunded and research has documented a number of barriers that diverse leaders face when accessing social investment.
Big Society Capital, alongside other partners such as Access and Bank of America, supported Big Issue Invest and UnLtd, to create a fund aimed at making social investment more accessible to diverse-led community businesses and social enterprises. This innovative investment will serve as a pilot targeting a key gap and will aim to bring more mainstream investment into diverse-led enterprises.
The Growth Impact Fund is a £25 million evergreen fund, which means capital will be recycled to allow it to make loans in perpetuity. The fund will make investments between £50,000 and £2,500,000 to organisations seeking to address inequality in their communities, with at least 50% of these being diverse-led. £3.5 million of the Fund will come from grant income and will help cover the costs of any loans that cannot be fully repaid. The organisations will also have access to grants, which will help to provide technical assistance to support them with the investment process.
Fund sizeTarget £25 million: evergreen
Big Society Capital commitment£1 million
Fund managerBig Issue Invest
Term5-7 year lock-up period