CAF Venturesome completes 500th social investment - warns of ‘huge unmet demand’ for social finance

6 July 2016

CAF Venturesome – the social investment arm of the Charities Aid Foundation - has made its 500th social investment.

It has now helped charities and social enterprises with more than £40 million in affordable repayable finance since it was established in 2002.

The 500 social investments have given a lifeline to hundreds of charities and social enterprises covering a multitude of causes ranging from dishing up healthy school meals, raising levels of literacy in South Africa and building much needed-affordable housing in England.

During that time CAF Venturesome has been supported by more than 100 funders – many of them getting involved in social investment for the first time.

CAF Venturesome is one of the UK’s most active providers of social investment. It provides unsecured loans of up to £350,000 to social organisations with a clear charitable purpose, with a particular focus on organisations which can demonstrate their strong social impact but may be considered too high a financial risk by other lenders.

Analysis of the 500 social investments shows that:

  • £101,000 was the average size of a social investment from CAF Venturesome’s main funds
  • Four out of every five organisations supported have high social impact.
  • The south-west of England has proved to be the UK’s social investment hotspot with 14% of organisations backed by CAF Venturesome based there. The east of England accounted for 12% of social investments followed by London and the south-east which each accounted for 11%. 
  • CAF Venturesome also has impact internationally, with 14% of social investments made to charities working overseas.

Demand from charities and social enterprises for affordable, repayable social investment is growing significantly, with CAF Venturesome warning that there is currently a major shortage of social investment available compared to the level of demand. The shortage is particularly acute for organisations looking for social investment of £150,000 or less.

Holly Piper, Head of CAF Venturesome, said:

“CAF Venturesome has established itself as one of the UK’s most active social investors, prioritising social impact over financial return.

“Demand for social investment has rocketed in recent years and CAF Venturesome has been at the heart of that success story. It has been fantastic to see the huge difference we have helped to make to so many different organisations, working all over the world, from reading classes for vulnerable children in Africa, to providing housing for those frozen out of the market closer to home.

“We believe that prioritising social impact over financial return is the most effective way to address the unmet demand for affordable repayable social investment.

“However it is clear that there is still a huge amount of rising demand from charities and social enterprises which is not being met. In such tumultuous times, we expect this demand to only increase, as more and more charities look to diversify their income streams and improve their resilience in the face of economic and policy uncertainty. CAF Venturesome has a valuable role to play in supporting social organisations with the affordable, repayable finance.

“We are determined to become even more ambitious in the support we can offer to social organisations and will continue encouraging others lenders to see the huge positive impact of social investment.”

Charities and social enterprises supported by CAF Venturesome include Cornwall Community Land Trust. CAF Venturesome has supported Cornwall CLT in developing much-needed affordable housing in Cornwall. It has provided the CLT with six loans since 2008. The most recent funding, also supported with a loan from CAF Bank, was used to help cover the development costs of eight new homes.

Notes to Editors

CAF Venturesome provides affordable repayable finance to charities, social enterprises and community groups which are incorporated in the UK. It provides unsecured loans where conventional lenders do not. It offers financial support of between £25,000 and £350,000.

Contact: Simon Ward, Charities Aid Foundation, 0300 012 3286

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