Investment criteria | Types of financing
 

 
Printer Friendly
   
   
   
 

Social Capital Partners funds businesses that demonstrate the discipline and competitive spirit of a private sector company while striving to generate outstanding social outcomes for the individuals they employ and communities they support. These businesses demonstrate the following characteristics.

  • Hire the majority of employees from an economically disadvantaged community
  • Provide skills and experience that promote long term employment
  • Consider multiple needs of the target population (e.g. housing, counseling etc.)
  • Compete successfully within a strong segment of the market
  • Have a solid plan to reach break even or profitability within 3 years
  • Have a realistic short term growth plan that involves employing at least 12 individuals from target populations
  • Have a realistic long term growth plan that involves employing 30 or more individuals from target populations
  • Are capable of meeting any repayment obligations to SCP and other financiers
  • Have an outstanding management team that is capable of carrying out the plan
If an organization meets the criteria above, then we will investigate the investment opportunity further. Before we finalize any financing commitment, we will conduct a thorough social and financial due diligence process.

We generally do not invest in start-ups because it is rare for them to be able to meet our investment criteria, and they require relatively more effort than existing enterprises to scale up. Social Capital Partners also does not provide financing for:

  
 

  • Feasibility studies
  • Events
  • Real estate
  
  Our criteria are in place to help guide Social Capital Partners in achieving its social mission. They are not a comment on how worthwhile or beneficial to society any organization or project may be. On the contrary, we are frequently impressed with the creativity, energy, dedication and impact of individuals and groups working to achieve their social mission, even though only a few of the endeavours meet our investment parameters.

Traditional financing mechanisms exist to provide capital to organizations that create purely financial outcomes (loans or investments to private sector companies) or those that create purely social outcomes (tax deductible gifts to charities). There are few financing mechanisms available to those organizations that are employing hybrid models to create social value at the same time as doing business. By providing financing for businesses that fit this description, SCP is attempting to fill an important gap in the capital market.