Impact Investment Profile

Investor

Esmee Fairbairn Foundation

Investee

Bridges Social Entrepreneurs Fund

Esmee Fairbairn Foundation works to improve quality of life throughout the United Kingdom. Bridges Social Entrepreneurs Fund aims to address the funding gap often faced by fast growing social enterprises looking to scale. 

Investor Targeted Impact

Catalyze new funding mechanisms to scale high-impact social entrepreneurs

Investor

Name Esmee Fairbairn Foundation
Investor description Esmee Fairbairn Foundation (EFF) is one of the largest independent grant-making institutions in the United Kingdom. Founded in 1961, EFF works to improve quality of life throughout the U.K. The foundation makes grants to support diverse organizations working in the arts, education and learning, environment, social change, and sustainable food sectors. In 2008, EFF launched its GBP 21 million Finance Fund to make mission-focused investments that combine social and financial impact.

Investee

Fund/product name Bridges Social Entrepreneurs Fund
Manager information Bridges Social Entrepreneurs Fund (SEF) is managed by Bridges Ventures, a London-based private investment firm dedicated to using an impact-driven investment approach to create returns for both investors and society. Bridges Ventures aims to achieve social and environmental benefits as well as financial returns. Founded in 2002, the firm has around USD 400 million in assets under management across three main types of funds, which focus on sustainable growth, sustainable property, and social entrepreneurs.Bridges Ventures is majority-owned and managed by its executive directors and the Bridges Charitable Trust. While the management team is the majority shareholder, Bridges Charitable Trust has a 30 percent interest in the firm and has control over any change to the company's founding commitment to raise only funds with social goals.The Bridges Charitable Trust supports activities that cannot be funded with the commercial investment with which the Bridges Ventures funds operate. The Bridges Ventures team members have committed to donating 10 percent of their own profits from the Bridges Venture funds to the Trust. The Trust has wide charitable goals but a particular focus on supporting entrepreneurship, and one of its first activities was to create and seed the SEF fund in 2008.
Sector Multi-sector
Geography Western Europe - United Kingdom
Asset class Private Equity
Size of fund/product GBP 12 million (USD 18.7 million)
Fund/product description SEF was raised in 2009 to invest in growth stage social enterprises based in England. The fund aims to address the funding gap often faced by fast growing social enterprises looking to scale. SEF tailors each investment to ensure that it fits the needs of its investees and aims to make a reasonable financial return to demonstrate a sustainable funding source for social enterprises. SEF makes investments up to GBP 1.5 million (approximately USD 2.3 million), which are typically structured as a flexible investment in the form of quasi-equity and debt. Investments are repaid only from the social enterprises' financially sustainable activities, typically through cash flows. SEF specifically looks to invest in social enterprises that have:- A clear social mission protected in their legal structure- A robust, financially sustainable business model- Ability to grow to scale and increase their social impact- Ability to generate surpluses to repay financing- A strong management team
Motivations for investment EFF identified an emerging need for equity-like funding for social enterprises to grow. Prior to the launch of SEF, few sources of this type of financing existed in the U.K. EFF therefore decided to invest in this fund and two others through its Finance Fund in order to increase the flow of equity-like capital to social enterprises. For this investment, EFF was particularly attracted by the professional approach and background of SEF's founders and the fund manager, Bridges Ventures.

Investment

Instrument Equity in the form of a partnership share in a limited partnership
Investment size GBP 750,000 (USD 1.2 million)
Investment term Up to 10 years
Investment impact objectives EFF's investment in SEF reflects its objective to support initiatives that help scale the social enterprise sector. EFF anticipates that intermediaries' specialist staff may be able to make better investment decisions than would the foundation when making similar direct investments. EFF also seeks to invest at a relatively early stage, taking risks to prove and grow a concept. By capitalizing a fund structure open to other investors, the foundation hopes that its investment will catalyze additional resources for social enterprises.
Social and environmental metrics tracked on investment EFF receives an annual impact performance report which Bridges Ventures sends to all its investors. In addition, Bridges Ventures issues an annual impact report for a wider audience that highlights select performance data and presents a number of case studies to illustrate its approach. There are certain key impact indicators that are common across Bridges Ventures' investments, which they aggregate to tell a broader fund-level story. Since each investment has a distinct strategy for achieving social impact, Bridges Ventures also tailors indicators to each portfolio company and, wherever appropriate, they use IRIS metrics and definitions (IRIS alignment noted in parentheses). Metrics include: Total Number of Jobs Maintained in Financed Enterprises: Low-income Areas (IRIS aligned - PI2688)Number Jobs Created in Financed Enterprises: Low-income Areas (IRIS aligned - PI2251)Employees Residing in Low-income Areas (IRIS aligned - OI266>)Number of Jobs Created for the Formerly Unemployed

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