How organisations use social investment in practice

Social investment is typically used at key stages in an organisation’s development, such as funding equipment, premises or service expansion to increase impact. At Big Issue Invest, this type of finance is primarily aimed at organisations already generating operational revenue, as early-stage activity often carries higher risk and repayment can be less appropriate. Early-stage organisations are therefore encouraged to explore grant funding and other appropriate funding options. 

This page will look at how social investment is used in real situations, drawing on patterns and examples from social enterprises’ experiences with funding from Big Issue Invest and our partner programmes. 

When social investment becomes relevant to organisations

Rising operational costs, growth ambitions, and the need for long‑term resilience are common reasons to look into social investment:

For Linskill and North Tyneside Community Development Trust, energy bills across three community hubs doubled from £70,000 to £140,000 per year. This made continued reliance on grants increasingly risky as failure to obtain one could mean the difference between achieving their mission and closing. This pushed the organisation to explore investment that could reduce costs and stabilise operations.

In other cases, such as Ruka, social investment became relevant when early‑stage crowdfunding and seed capital were no longer sufficient to support the next phase of growth. As the business began to scale, many venture capital and private equity options came with demands that directly conflicted with Ruka’s purpose-led approach and its focus on developing innovative products designed specifically for Black women.

Examples of how organisations use social investment

Linskill and North Tyneside Community Development Trust used a £130,000 loan to install solar panels and air‑source heat pumps. This reduced energy costs by an estimated £14,000 per year, lowered carbon emissions and freed up funds for frontline community services.

Ruka used investment from Big Issue Invest to expand its internal team, strengthen research and development capabilities and file a patent for its shape‑memory fibre technology. The funding supported innovation that aligned directly with the organisation’s social mission and long‑term sustainability.

Across Big Issue Invest’s wider portfolio, social investment has enabled SEND colleges to purchase new premises, alternative education providers to expand services, and community organisations to increase capacity and reach underserved groups.

What changes after investment is in place

In our experience tenuous touch and go situations such as that seen by Linskill, shift into robust delivery of their mission. Meanwhile for Kalda it has helped grow a groundbreaking idea into something which is on track to help 200,000 people. 

Taking on repayable finance often leads to stronger financial discipline, clearer planning and sharper decision‑making. Organisations report improved understanding of income streams, costs and risks.

Rather than diluting mission, appropriate social investment can reduce short‑term financial pressure and allow teams to focus more fully on delivering impact and responding to community needs.

Thinking about social return, not just repayment

Social return is often understood in practical terms rather than purely through metrics. Organisations reflect on what has changed, who has benefited and whether they are now more resilient and better able to deliver impact.

For Linskill, savings on energy costs translate directly into sustained community provision. For Ruka, investment has accelerated innovation in a market that has historically underserved certain customers.

What these experiences tell us about social investing

Successful social investment works best when it aligns with an organisation’s mission, income model and capacity to repay. Timing is critical, and funding is most effective when used deliberately to support long-term goals. In some cases, short-term bridging finance can also play an important role, helping organisations manage temporary funding gaps where future income is expected to grow.

In conjunction with other funds, Linskill has been able to reduce operating costs, allowing them to continue operation. Now Linskill is almost self-reliant, with grants accounting for only 1% of their turnover, and they now operate one of the largest community centres in England. Their financial return on investment from the solar panels alone will be achieved in under 7 years but during this time the reduced environmental impact and running costs will have much larger SROI.

How Big Issue Invest works with organisations

Big Issue Invest provides tailored social investment to organisations tackling poverty and inequality across the UK. Its approach is grounded in understanding real operating conditions, income models and long‑term ambition.

By combining flexible finance with strategic support, Big Issue Invest helps organisations strengthen what works and extend their impact over time.

FAQs

What is social investment in simple terms?
Social investment is repayable finance designed for organisations that deliver social impact. It aims to support sustainability and growth while recognising that social purpose organisations operate differently from conventional businesses.

When does social investment usually make sense for an organisation?
Social investment is often explored once an organisation is trading, delivering impact and has some level of reliable income. It tends to be most useful when grants alone no longer meet needs but mainstream finance is not appropriate.

Is social investment suitable for every organisation?
No, social investment is not a replacement for grants and does not suit all models. It works best when there is a clear purpose for the funding and a realistic route to repayment over time.

How is social return on investment (SROI) used in practice?
SROI assigns a financial value to non-monetary outcomes, helping social enterprises understand and articulate the impact of their work. In practice, it supports clearer reporting, stronger accountability and more informed budgeting, while enabling organisations to forecast impact and plan activity more effectively. By presenting impact in a recognised and consistent format, SROI can also strengthen applications for grants and contracts where minimum impact requirements apply.

Does taking on social investment change an organisation’s mission?
It shouldn’t. When used appropriately, social investment is intended to support an organisation’s mission by strengthening its foundations, not by shifting priorities away from impact.