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The Social Enterprise Investment Fund

  • Last modified date:
    15 July 2008
  • Gateway reference:
    9788

From April 2007, the Department is holding a Social Enterprise Investment Fund (SEIF) of £100 million over a four year period (£63 million capital and £27 million revenue from 2008/09 to 2010/11).  In 2007/08, £1.7 million revenue and £8.9 million capital money was available to new and existing social enterprises*, delivering health and social care services, who applied successfully for this funding. In 2008/09, we are making a further £11 million capital and £6 million revenue funding available to new and existing social enterprises.

The SEIF is currently managed by a specialist team led by the DH-owned company Community Health Partnerships.  It works closely with the Social Enterprise Unit and an independent investment panel to assess applications to the fund.  We are reviewing the first round of the fund and will apply learning to future application rounds and the further development of the fund, in order to respond to the needs of social enterprises and the experience gained from social enterprise pathfinders.

* The government defines a social enterprise as ‘a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners.

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About SEIF

What are the objectives of the Social Enterprise Investment Fund (SEIF)?

  • To support the delivery by social enterprises of health and/or social care services and products in England.
  • To provide start-up funding and longer-term investment to emerging and existing social enterprises in the health and/or social care sector with a view to their sustainability.
  • While still encouraging social returns and stimulating the delivery of health and social care by social enterprises, a further longer term, objective is to become financially sustainable through returns on non-grant investments and through leverage of funds from external investors. SEIF will look to make progress toward financial sustainability by the end of the initial fund period.

Which organisations will SEIF support?

  • SEIF will support organisations which are, or are aiming to become, social enterprises delivering one or more health and/or social care services.
  • Previous applicants to SEIF may reapply.

How might SEIF invest in our organisation?

  • SEIF can offer Step1 finance:
    - development grants of up to £20 000 to cover start up costs such as business planning, legal advice and market research
  • SEIF can offer Step2 finance:
    - loans, loan guarantees, grants and equity capital or a mixture of these, depending on your organisational needs and structure. For grant/loan mixes, the grant proportion will be approximately 10% of the total funded by SEIF
  • SEIF also offers you the chance to learn how to assess the social outcomes of your work using a process to measure Social Return on Investment (SROI)
  • In view of its objectives of enabling the sustainability of its investees and achieving sustainability for itself, SEIF aims to minimise the grant element of its investment portfolio. The use of structured finance will help lead investees to sustainability, as well as allowing the recycling of SEIF funds. Applicants are therefore encouraged, when applying to SEIF, to consider their ability to support forms of finance other than grants.
  • All potential investments will be subject to a thorough appraisal process which will help us to understand your needs and to provide the form of finance best suited to the

How much funding can our organisation apply for?

  • There is no minimum amount, but there is a maximum any one investment of £10,000,000

When can our organisation apply for finance from SEIF?

  • The fund is now open for your applications for financial investment.
  • Application forms and all accompanying documents must be received by 17.00h on 31st July 2008. If you send your application by post, please obtain proof of posting.
  • Subsequent calls for applications will be announced on this site.

Welcoming social enterprise into health and social care

Please see the resource pack 'Welcoming social enterprise into health and social care' for more information and guidance on setting up a social enterprise in the health and social care sector. The pack will be useful to people wanting to start and those already operating a social enterprise and to commissioners who want to contract with social enterprises.

Who can apply

  • Multi-agency partnerships, particularly voluntary and community groups wishing to use their expertise to provide services across health and social care.
  • Existing social enterprises looking to expand into health and social care.
  • Groups of professionals (eg nurses, therapists), seeking to form a social enterprise to deliver their services.

All the social enterprises we support would be expected to have “not-for-profit” status, in that surpluses will be reinvested in the pursuit of their social aims.

Application process

The application round for 2008/09 will be open from 6 May, The final date for submission of applications will be 31 July.

We will be in touch with everyone who has applied within 60 days of the closing date to let you know whether or not your application can be taken forward.

Please see the documents attached below for guidance on how to apply and information on how applications will be assessed.

To help you decide whether or not to make a proposal for finance, please carry out this short self-assessment:

  • What service are you offering?
  • Who is your market and who is your competition?
  • Can you identify a market for your product/services?
  • How will your business make a profit?
  • What do you expect your business to have achieved in three years’ time?

If your organisation can satisfy the eligibility criteria and you know the answers to all of the five self-assessment questions, you could benefit from Social Enterprise Investment Fund finance.

SROI (Social Return on Investment)

Social Return on Investment or SROI is an approach used to understand the social, economic or environmental value being created by an organisation and can be thought of as a way of identifying and valuing the change that the organisation creates.

SEIF is keen to make progress towards measuring SROI in relation to its investees. For Round 2, we are looking to assist investees in defining the social outcomes of their work  and identifying indicators for these. The SEIF application form asks a number of questions that will require applicants to start thinking about their services in relation to SROI.  If your application is successful at stage 1, we will develop a forecast of outcomes and indicators for your project, which we will then discuss and finalise with you. This will involve:

  • analysis of your stakeholders,
  • identification of core stakeholders in relation to your funding application
  • an impact map for these stakeholders.

At the end of the year, you will be able to compare your actual outcomes with those you originally expected. This will enable you to manage the reasons for any differences – in much the same way as you would manage your budget.

The management of your outcomes will entail a set of measures that will allow your organisation to produce the information necessary to update expected outcomes with actual results. The measures are likely to involve changes to management systems. The implementation of these measures will be a condition of all forms of funding

Our guiding values - these underpin the investments we will make

  • Enabling and supporting embryonic social enterprises delivering health and social care services
  • Responsive to differing stages of development
  • High standards for business development; low threshold for access to support
  • Encouraging new ideas
  • Open and involving social enterprises in the development of the services provided
  • Challenging social enterprises and those who support them to think beyond  traditional boundaries
  • Taking a non-bureaucratic, facilitative approach
  • Achieving a speedy turnover of applications and provision of services
  • Taking an innovative approach in using new forms of finance where appropriate
  • Social mission shaping financial policy
  • Encouraging a blend of social and financial return of investment

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