- City Funds launches investment fund that is first of its kind in the UK
- Funding approach joins investment, grant and local authority support
- Impact investment will strengthen Bristol-based initiatives solving citywide problems
City Funds announced today the completion of their first investment funding round, securing over £10 million to address the causes and effects of inequality in Bristol.
One of the first funds of its kind in the UK, the impact fund brings together investment, grant and local authority support in a coordinated place-based approach to tackling inequality. With different types of funding under one roof, City Funds will strengthen Bristol-based initiatives that are working to solve some of the biggest social and environmental problems the city faces. City Funds is already actively seeking opportunities to invest in organisations that support these aims, through its investment advisor Bristol & Bath Regional Capital (BBRC).
City Funds will support impact-driven organisations in Bristol, investing from £50,000 to £1 million with flexible terms that support social or environmental aims. In addition, development funding will be available, where repayment will be linked to success milestones such as achieving planning permission. Both types of finance may be eligible for grant funding as part of a blended approach in partnership with charitable trust Power to Change.
Ed Rowberry, City Funds board member and Chief Executive at BBRC, said: “Bristol is known for home-grown solutions to local challenges. City Funds maintains that DNA and is designed to amplify it—making finance work for the local projects and businesses with the ambition to have a positive effect in our communities.”
The fund aims to support:
- Economic Inclusion: funding initiatives that promote full participation and ownership in a diverse and local economy
- Environmental Transformation: funding the transition to a carbon neutral, zero-waste city, that promotes the health of the natural environment
- Community Initiatives: funding community initiatives to help them play an impactful role in Bristol and develop community resilience
- No Child Goes Hungry: funding initiatives that help communities grow, purchase, prepare and cook fresh, healthy and affordable food
Cornerstone investors are Big Society Capital, the UK’s leading social impact investor, and Bristol City Council who have committed £5 million each. In the UK, impact investing is now worth £2.3 billion1, yet this investment marks the first time Big Society Capital has engaged in a collaborative place-based investing approach, aiming to reduce inequality in a geographic location whilst also generating a financial return for investors.
Anna Shiel, Head of Operations at Big Society Capital, said: “City Funds is a premier example of what can be achieved when investment, grant and government support come together to focus on addressing the needs of a specific place through enterprising solutions. A place-based approach is much more likely to foster the collaboration and energy needed to tackle deep-rooted challenges such as inequality and poverty. Bristol is clearly leading the way, and that’s why we have chosen City Funds as our first partner to champion place-based investment.”
Power to Change has invested a further £250,000 for the first year of the fund. This contribution will enable community businesses to access a blended package of grant and loan alongside the loans offered by the wider fund.
Vidhya Alakeson, chief executive of charitable trust Power to Change, said: “It is tremendously exciting to see this fund go live and I am very proud Power to Change can be involved. By investing grant funding with City Funds, we will make finance more accessible to smaller organisations and better meet their needs, ensuring that they can be well served by the City Funds and helping them on their journey towards longer term sustainability. This blended approach ensures that community businesses get the right sort of money, on the right terms and at the right time.”
As an example of Bristol’s One City Approach, City Funds is a strategic partnership between BBRC, Quartet Community Foundation and Bristol City Council. The One City Approach is a sustained effort to work across sectors to create solutions to Bristol’s continued inequality: although Bristol’s economy produces around £31,000 of value per head,2 72,000 residents suffer from income deprivation—as high as 49 per cent in some wards.3 City Funds is using the One City Approach to create greater levels of transformation than multiple different transactions made in silos, which has proven inadequate to generate long-term solutions.
Marvin Rees, Mayor of Bristol, said: “Aligning investment in City Funds to the One City Plan and delivering against the key challenges the city faces will be truly transformational for the city. Achieving investment from Big Society Capital and grant funding from Power to Change at this early stage in the development of the Funds shows how successful this approach can be and is a real step forward towards delivering inclusive and sustainable growth.”
Initiatives seeking funding can find out more at www.bristolcityfunds.co.uk
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NOTES TO EDITORS
1 BSC Size of SI mkt as at 31 December 2017
About City Funds
City Funds is working to transform Bristol by funding solutions that target the causes and effects of inequality. A partnership between Bristol & Bath Regional Capital, Quartet Community Foundation, and Bristol City Council, City Funds uses its £10 million investment fund and aligned grants to strengthen organisations solving some of the biggest problems facing Bristol. By partnering with communities, sectors, experts and other funders, City Funds is facilitating new solutions to inequality.