The findings reveal that 47% of survey respondents who failed to secure investment felt they did not lack any financial, marketing or business skills. This is in sharp contrast to the views of investors and intermediaries who viewed the lack of suitable financial skills among potential investees as a critical barrier. They also identified wider problems in the market such as a general lack of understanding of the concept of social investment and the challenge of changing mindsets from the traditional charitable model to a business model.
Overall, the report demonstrates a strong need for more support in the emerging social investment market: 43% of the organisations that were unsuccessful in securing funding reported that accessing advice was difficult; and 32% of these said that simply identifying who to go to for social investment was very difficult.
Social investment is not suitable for all VCSEs, and should not be seen as a panacea for all difficulties faced in financing VCSEs. However, with support to develop the skill sets needed to secure repayable finance, social investment offers the potential for organisations to create new or different ways of delivering their goods and services.
These findings helped in the creation of an Investment Readiness Fund which was launched by the Big Lottery Fund in May 2013. The new fund will be aimed at organisations whose potential is not yet sufficiently developed to apply to the Cabinet Office Investment and Contract Readiness Fund.