What is a social enterprise?
Social enterprises are businesses with primarily social objectives, whose surpluses are principally reinvested in the business or in the community, rather than being driven by the need to maximise profits for shareholders or make private gain. Well known examples include The Big Issue, the Eden Project, Jamie Oliver’s Fifteen and Café direct.
Social enterprises sit between charity and mainstream business. There is no doubt that charities do immense social good. However, traditional charities often only deal with immediate needs and fail to tackle the underlying causes of problems or provide long-term solutions. Many charities are also grant dependent and therefor face sustainability challenges.
At Big Issue Invest we believe that business approaches can provide more sustainable solutions to social problems. Such social enterprises require finance solutions that are willing to take on a risk/return profile that goes beyond traditional investment models – one that is long term and brings social value creation into the investment decision-making process.
Legal structures and governance arrangements
We will only invest in organisations which exist primarily to deliver social impact and which reinvest the majority of their surpluses to further their social mission; including: charities (limited by guarantee or charitable incorporated organisations only), CICs (limited by guarantee or shares) and Industrial and Provident Societies (for community benefit). In exceptional circumstances we may invest in for-profit social sector organisations.