'Evergreen' investment now available from Bridges Ventures

Bridges Ventures has announced a successor to the Bridges Social Entrepreneurs Fund, which reached the end of its investment period at the end of 2015.

The new vehicle is called Bridges Evergreen Holdings and, as the name suggests, it will differ to the usual private equity approach by being structured as a holding company.

Those not overly familiar with the finance world may well wonder what that means. Investment will still be on offer – as debt, equity or quasi-equity.

But unlike most funds, which have a defined shelf life (usually 7-10 years), there is no fixed term for the pot of money available. Evergreen is described by Bridges as ‘a new permanent capital vehicle’.

In most funds announced for social ventures to date, fund managers need to exit their investment to get their money back (plus any additional proceeds). Bridges says it chose this new structure because mission-led ventures often have long-term social goals, so they need access to long-term capital and support.

The holding company is 'designed to free ambitious mission-led businesses from the constraints of traditional fund structures,' according to Bridges.

It also gives these ventures the option to maintain a long-term relationship with their backers, rather than seeking new investment partners every few years.

Anthony Ross, partner at Bridges Ventures, said: “We’ve learned from the Social Entrepreneurs Fund that when mission-led organisations get the right kind of funding and support from aligned investors, they can grow faster, compete more effectively and scale their impact. 

“With Evergreen, we have developed a structure that allows us to be a long-term partner for these organisations.”

Investment will be offered alongside the usual strategic/operational support that comes with the loan. Investors in the vehicle can profit from dividends and interest payments on loans.

Bridges has raised nearly £800m for investment in its 14 years of existence. Social enterprises that were backed through the Social Entrepreneurs Fund included childcare social enterprise London Early Years Foundation and Unforgettable, which offers products and support for dementia sufferers.

Evergreen will be launched with £22m. Big Society Capital is the cornerstone investor but local authority organisations such as Merseyside and Greater Manchester Pensions Funds have also committed.

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