Thu, 09/08/2018 - 13:06
Impact First, a ‘profit with purpose’ fund launched by social impact investor SIS Ventures, has secured 50 per cent of target capital commitments within the first two months of launch.
SIS Ventures, the mission-led investment arm of responsible finance provider Social Investment Scotland (SIS), is in the process of securing investors to participate in a GBP5 million fund, which looks to back Scotland’s high impact enterprises.
The first close of the fund seeks to raise GBP1.5-2 million from UK-based private investors, with the capital target for deployment over 12-18 months.
Since launching two months ago, SIS Ventures has managed to secure GBP750,000 from private investors seeking to generate both a social and financial return. It has also attracted significant demand from mission-driven organisations seeking funding.
Benefiting from both the Enterprise Investment Scheme (EIS) and Social Investment Tax Relief (SITR), Impact First offers investors a portfolio of between six and twelve high-growth potential, high-impact enterprises. These enterprises, however, must be aiming to tackle a clearly identifiable social problem with a scalable and disruptive business solution.
This innovative fund allows entrepreneurs with an ambition to make a difference whilst growing their business, to have access to mission-aligned investment through debt and equity investment; delivered by SIS Ventures.
A market study, undertaken by SIS, revealed that entrepreneurs felt that existing early stage investors often overlook social impact and that values are not always aligned. It is hoped that Impact First will provide capital to fuel a growing desire by these entrepreneurs to develop and grow their business with a mission-led approach, resulting in a more sustainable economy.
Thomas Gillan, director, SIS Ventures, says: “The response from both investors and enterprises within the first two months since launch has been very encouraging. As a hybrid fund, investors are being offered a unique vehicle to invest in high growth potential, socially-focused businesses offering both a financial and social return. It’s good to see investors seizing the chance to become part of something truly ground-breaking and really move the needle for social impact investing.”
Bob Hair, Wealth Planning Director & Head of Edinburgh Office, Cazenove Capital, says: “At Cazenove Capital we have observed a steady increase in demand from investors seeking opportunities which can have a direct social impact. There are numerous regional vehicles in the UK where investors can invest for purpose and also benefit from generous tax reliefs but here in Scotland those opportunities are limited. Many investors want to see a difference being made in their own communities but this is a highly specialised area and so it is encouraging to see professional and specialist investors such as Social Investment Scotland lead the way!”
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