Words by Smiley Team
The Growth Impact Fund, launching later in 2022, will invest in a range of different ventures, focusing on diverse-led social enterprises tackling inequality in the UK.
The aim of the fund – which is available to professional investors– is to tackle inequality and promote racial justice by being built around the needs of entrepreneurs historically locked out of social investment.
Bank of America and Access – the Foundation for Social Investment are the two recent major investors that have joined the fund, which hopes to offer "flexible and patient capital for social businesses" to grow their impact, ringfencing a minimum of 50% of funding for leaders from underrepresented backgrounds.
For the past 18 months, social entrepreneurs of diverse genders, ethnicities, disability, age, and more have been working with the three organisations to design and develop a social investment fund for social enterprises working to ease societal inequalities.
The Growth Impact Fund aims to make social investment work better for social businesses by:
1. Offering investees patient, flexible capital, with options including 70% of funding invested through equity and quasi-equity products.
2. Offering grant funded wrap-around support across the investment process.
3. Addressing sector representation head on, actively committed to ensuring that the team, management and governance of the fund are more representative of the Founders the fund looks to support.
"Social entrepreneurs will be represented across the Advisory Board and Investment Committee, bringing their lived experience and expertise to making decisions for their peers," they say. "Their voices will hold the fund to account in being fit for purpose, inclusive, accessible, and meeting the needs of diverse founding teams."
Investment Director at Big Issue Invest, Jonny Page, said: “We believe, alongside our partners, UnLtd and Shift, that much more has to be done to make investment inclusive. We are on a journey to do just that and we could not do this without the support of Bank of America and Access.
"They are enabling and supporting this transformative new impact fund: a fund that recognises and celebrates diversity, prioritises the social entrepreneur in every aspect of its design, and is built on partnerships and support to unlock growth. Our fund is committed to tackling inequality across the UK by investing into leaders from underrepresented backgrounds, as we continue to back human potential as part of Big Issue Invest’s impact strategy.”
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