If Keir Starmer wants to ‘deliver, deliver, deliver’, UK social investors can make Westminster’s money go further, argues Big Issue Invest’s new boss
OPINION: As Big Issue Invest celebrates its 20th birthday this week, new head Holger Westphely (pictured below) and original co-founder Nigel Kershaw (see box) say the concept of 'social merchant banking' is proven - but we must prepare for uncharted waters ahead.
I’m excited to be taking charge of Big Issue Invest as we enter this milestone year, which marks 20 years investing in dismantling poverty and backing business solutions to social crises. From Cornwall to Aberdeen, millions of lives have been improved thanks to Big Issue Invest – once a kernel of an idea now grown exponentially since Nigel Kershaw and John Bird dreamed it up in 2005.
You’ll forgive us a little sentimentality as we reflect on our first 20 years (see box below), but it’s my job to look forwards, to the next 20 – steering the ship towards new horizons and building on this incredible legacy to make even more impact.
These waters are not as uncharted as they were when Nigel and John set off on this adventure two decades ago. Thanks in part to the efforts of trailblazers like Big Issue Invest, the social investment market has matured and evolved, with its potential for delivering change now far more understood by governments and potential investors. We’re no longer one of a few small ships on a vast ocean.
We’re no longer one of a few small ships on a vast ocean
With recognition comes opportunity for Big Issue Invest. In this next chapter, we’re looking to scale – to build on our 20-year track record to become a larger, more resilient player in the social investment space.
This past year for Big Issue has been one of both exceptional progress and deepening social challenges. With poverty now affecting 21% of the UK population and social needs rising across every region, we are glad to have significantly scaled our support for the sector by committing a further £9.3m to 50 social purpose organisations, marking a drastic increase in our year-on-year deployment.
- Read more: £3m Homes for Good deal with Big Issue Invest is ‘one of largest social investment exits on record’
This growth reflects our unwavering belief in the power of social investment to create lasting change. We’re here to show that it is possible to combine return and social impact, and that social investment can be a very fruitful endeavour for private investors and governments alike.
The UK government today lives and dies on its ability to tangibly improve its communities. Making positive change that people can feel is vital for retrieving public trust. Local social enterprises and charities are ideally positioned to deliver this impact. They are embedded in communities, run by members of the community; they can be nimble and react to local need.
The UK government today lives and dies on its ability to tangibly improve its communities... Local social enterprises and charities are ideally positioned to deliver this impact
If Keir Starmer wants to ‘deliver, deliver, deliver’, Westminster should direct its money here and expand the money it’s committing to local and regional delivery, something that Big Issue Invest has long championed. As a ‘social merchant bank’, as Nigel so eloquently puts it (see box), we are uniquely placed to match up this funding with the investees that can make the most impact. With new Impact Managers based in the North East and West Midlands we’re placing ourselves at the heart of the UK’s social enterprise networks.
We can use this government investment to open the door to private investment, a cornerstone on which we can build something larger still. An increasing number of institutions want to do good with their investments while still earning a financial return
Furthermore, we can use this government investment to open the door to private investment, a cornerstone on which we can build something larger still. An increasing number of institutions want to do good with their investments while still earning a financial return, such as global insurers like Aspen and Beazley. The challenge now is to mobilise that financial muscle and make more institutions aware there doesn’t need to be a trade-off between measurable societal impact and positive investment returns.
Social investment is full of untapped potential at a time when the country is crying out for new ideas and new ways to deliver change. But the sector remains underfunded, and attracting new forms of capital through innovative, impact-led strategies is vital to meeting demand. The call to action has never been more urgent.
So happy 20th birthday, Big Issue Invest. You’re still young and your adventure doesn’t end here. There are new, uncharted waters to be explored, and the wind’s in our sails.
“What is now proved, was once only imagined”
It all started 20 years ago – in effect as a social merchant bank – “by the social entrepreneurs – for the social entrepreneurs”, writes Nigel Kershaw (left), Big Issue Group Chair and Big Issue Invest co-founder.
It is a simple concept. If you are a social entrepreneur or enterprise looking for funds, come to us and we will be able to get you suitable investments and partners from early-stage investment through to funds for ordinary investors for their ISAs, pensions or savings, and we will assess the positive societal impact. We walk the talk – as a social enterprise ourselves, Big Issue knows how to assess our own impact with the people we work with, through Big Issue vendors and Big Issue Recruit. If you are a social investor, such as pension funds, charities and endowments, we can place your money to match what social and financial returns you are looking for from early-stage investment through to retail funds and assess the positive societal impact. It’s about relationships, partnerships, joint ventures, products all fuelled and driven by the social entrepreneurs backed by the social investors united in our social mission. I love the poet William Blake, and this quote sums up for me the pioneering and challenging spirit which runs through Big Issue Group and Big Issue Invest: “What is now proved was once only imagined.” I think you can have a lot of ideas, but the real key to your ideas is having that great team of people. Those people that have one foot in the ideas camp and one foot in the ‘make it happen’ camp. They are the unsung heroes and heroines of the movement – not to mention the 300 frontline social enterprises we have supported in preventing poverty for future generations over the last 20 years. In this past year alone, we invested in 145 investees who employ 12,000 people, with 1.8 million people supported by their work. So let’s celebrate how Big Issue Invest has helped and enabled over 300 organisations in its first 20 years. It has changed lives in the same way the Big Issue magazine has and continues to – that’s why we proudly wear the badge of being social merchant bankers. |
- Find out more about Big Issue Invest’s 20th birthday.
Header photo: the team from accessibility platform Sociability, supported by Big Issue Invest / UnLtd's Growth Impact Fund.
Middle photo: careers day at Great Oaks College, supported by BII's Social Impact Debt Fund IV with a loan to Great Oaks College to allow it to transition to a new site and provide its students and staff with long term security.
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