Combined authority invests in fund aimed at helping underrepresented communities

A social impact investment fund has welcomed new investors on board, including Greater Manchester Combined Authority.

Growth Impact Fund (GIF) has been developed by Big Issue Invest (BII), UnLtd and Shift, and is aimed at social enterprises and organisations from underrepresented backgrounds.

It has recently completed on its first close of £8.2m, towards its £25m target size.

It has welcomed Big Society Capital, Greater Manchester Combined Authority, the University of Edinburgh, Scope, Trust for London, Joseph Rowntree Foundation, Charities Trust, Barrow Cadbury Trust and renowned philanthropist Nick Marple, as its latest backers.

They will join the existing major partners of the fund, Bank of America and Access – the Foundation for Social Investment, who were both announced as coming on board last year.

In tandem with the announcement, BII, UnLtd and Shift have renewed their call for applications from UK-based entrepreneurs looking to grow in line with the news of further investment in the fund.

The fund has been designed and developed with social entrepreneurs of diverse genders, ethnicities, ages, and those with disabilities. It offers flexible and patient capital for social businesses to grow their impact, ringfencing a minimum of 50% of funding for leaders from underrepresented backgrounds.

A key eligibility criterion is that more than 75% of the board and 50% of the management team of each social business should identify as at least one of the inclusion groups: Women, disabled people, Black, Asian, minoritised ethnic, Gypsy, Roma, or Traveller, LGBTQIA+, have direct lived experience of the social issues the social business is focused on and have experienced socio-economic disadvantage.

The fund, which is funded by professional investors only, will offer between £50,000-£2.5m to its investees.

Every investee in the portfolio will have access to grants and non-financial help to grow their social business and social impact. Investees can use the support for needs such as caring responsibilities, accessibility support, consultancy, or professional development.

Cllr David Molyneux, Greater Manchester lead for investment, said: “We’re proud to be backing the Growth Impact Fund and supporting social entrepreneurs to grow, to develop, and to make a positive contribution to their local communities and economies.

“We know that this is a tough time for lots of organisations in the sector, particularly those from underrepresented backgrounds who might already be experiencing disadvantages or facing barriers to accessing funds, and we want to do all we can to help them and the vital work they do.”

He added: “This is also a prime example of how Greater Manchester is recycling funds to ensure that the investments we make continue to deliver benefits for people across Greater Manchester, in line with our vision for making this a better, fairer, more prosperous place to live and work.”

Sarah Faber, investment director for the fund, at Big Issue Invest, said: “Everyone agrees that something needs to rectify inequalities in social investment, and by doing things differently we hope that we can scale up some amazing entrepreneurs, making a difference to their communities who might not have been supported otherwise.”

Mathu Jeyaloganathan, head of investment at UnLtd, said: “We’re very excited to welcome new investors on board and with their support will be aiming to put some money behind some game-changing diverse-led social enterprises tackling inequality in the UK.”

Social enterprises interested in the Growth Impact Fund can visit growthimpactfund.org.uk to learn more and register their interest.