Charities and social enterprises in Scotland are set to benefit from a new £16 million fund to back their growth plans, thanks to an initiative jointly funded by UK and Scottish Government cash.
Social Investment Scotland (SIS) has secured an £8m commitment from both Holyrood and Big Society Capital (BSC), the world’s first social investment bank – set up in April 2012 to develop and shape a sustainable social investment market in the UK.
BSC’s backing of the new Social Growth Fund will be the first of its kind in Scotland, and will increase SIS’s funds under management by a third. It will be the largest investment in SIS for 12 years and the largest ever investment by an external organisation.
SIS chief executive Alastair Davis said: “SIS aims to grow its funds under management significantly over the next five years and this new Social Growth Fund represents a substantial step in this direction.
“The investment is recognition for the considerable social impact achieved by our work to date, and will go a long way to helping us achieve our strategy for growth, making a real difference to more lives in communities across Scotland.”
Chairman Nick Kuenssberg, pictured, added: “Alastair Davis and his team are now seeing their ambitious plans maturing, permitting SIS to add significantly to its potential for connecting communities and capital. We would like to thank both BSC and the Scottish Government, and John Swinney in particular, for making this possible.“
Since its launch in 2001, the Edinburgh-headquartered SIS has invested more than £43m in almost 200 of Scotland’s charities and social enterprises, becoming Scotland’s largest community development finance institution.
Projects that have benefited from the funding are worth in excess of £60m and tackle a range of social issues, including employment and training, health, arts and culture, care and the environment.
In September 2013, the organisation unveiled a five-year strategy, which set out a series of commitments grouped within five main themes aimed at connecting more capital with communities. Its new Social Growth Fund will focus on funding and delivering projects that create “measurable social impacts”.
Gareth Magee, partner at business adviser Scott-Moncrieff, said social enterprises have become “much less niche” in recent years and access to funding is as a big an issue for them as for “traditional” commercial enterprises.
“Traditionally, their focus on social good as opposed to profit has meant that social enterprises have often found it harder to get funding.
“After a long period in which much effort has been made by the social enterprise community to provide better access to funds, the news of an additional £16m injection into the pot is really welcome.”