Growth finance designed around impact and income

At Big Issue Invest, we support social enterprises and mission-driven businesses that are ready to grow but don’t always fit neatly into traditional funding models. Some organisations need patient capital; offering flexibility while income builds. Many want to scale their impact without compromising their mission.

That’s where equity and revenue participation come in.

These forms of growth finance sit alongside loans and grants, offering organisations different ways to fund expansion while recognising the realities of social enterprise income, impact and long-term sustainability.

Equity and Revenue Participation explained

As organisations grow, they may need capital that goes beyond what a standard loan can provide, or alternatively, the conditions of a loan may not be favorable. Equity and revenue participation, also referred to as quasi-equity, offer alternative approaches, designed to support long-term growth while aligning with social purpose.

We provide two related but distinct types of growth finance:

• Equity investment, where capital is provided in exchange for shares. Therefore, equity investments can only be made into Companies Limited by Shares. The company is valued and the investor is given dividends according to their ownership % in that company and the capital that has been gained or lost as part of that investment.
• Revenue participation (quasi-equity), a flexible form of repayable finance where repayments move in line with performance rather than fixed schedules

Both approaches are used to support organisations tackling poverty and inequality, and both are structured with long-term sustainability in mind. These offerings are designed for diverse organisations led by: people from ethnic minority backgrounds, women, Queer or other under-represented groups.

Equity investment: patient capital for long-term growth

Equity investment provides long-term capital to social enterprises and mission driven businesses with live product and clear ambitions to scale their impact.

Big Issue Invest would purchase shares, typically 15-25% dependent on the size of investment and business prospects, so this is only available to organisations and companies limited by shares. 

With equity investment:

• Capital supports growth without immediate repayment pressure
• Risk is shared between the investor and the organisation
• Governance arrangements are designed to support mission alignment and sustainable decision-making

Our approach to equity is patient and impact-led. It focuses on helping organisations grow in a way that strengthens both their financial resilience and their social purpose, rather than pushing for rapid returns or short-term outcomes.

Revenue Participation

Revenue participation, sometimes referred to as quasi-equity, is a form of repayable finance that behaves like equity in its flexibility, while remaining a loan.

Unlike equity investment, revenue participation does not involve giving up ownership or control. Instead, repayments are linked to your revenue.

When income grows, repayments increase. When income dips, repayments reduce. This flexibility allows organisations to invest in growth without being constrained by rigid repayment schedules, particularly when income is uneven or still developing.

How Revenue Participation works in practice

With revenue participation, repayments are typically linked to a share of revenue rather than fixed monthly amounts.

This approach recognises that:

• Income can fluctuate
• Growth is rarely linear
• Fixed repayments during quieter periods can create unnecessary pressure

By allowing repayments to move in line with performance, revenue participation creates closer alignment between an organisation’s success and the finance supporting it. 

This is why it’s often referred to as quasi-equity due to its similarities with equity agreements. The major differences are the maintenance of full legal control and the extraction of funds from revenue rather than through dividends.

How Big Issue Invest works with Revenue Participation

We will partner with companies usually investing between £150,000 and £450,000 however we do offer up to £750,000. In terms of repayment we will typically take 5% of all business revenue over an 8 year period. This all varies based on initial investment, impact and business requirements, revenue volumes and other conditions. Additionally earnings will be capped so we do not take a disproportionately large amount relative to the investment size.

Choosing between Equity and Revenue Participation

Both equity and revenue participation can support growth, but they suit different circumstances.

Equity investment may be appropriate where:

• Long-term capital is needed to scale impact
• The organisation is comfortable with shared ownership
• Growth plans extend over many years
• There is a commitment to growing towards an eventual exit / sale of the organisation 
• You must be a company limited by shares 

Revenue participation may suit organisations that:

• Are generating trading income
• Want repayment flexibility without giving up ownership
• Prefer repayments that respond to performance rather than fixed schedules
• This is generally open to all companies with ongoing operating revenue

We work with organisations to explore which approach, or combination of approaches, makes the most sense for their situation.

Part of the Growth Impact Fund

Our equity and revenue participation investments are delivered through the Growth Impact Fund.

The fund focuses on providing flexible growth capital to mission driven businesses with diverse leadership tackling poverty and inequality. It supports organisations that are ready to scale their impact while maintaining financial resilience and strong alignment with their mission.

Further details on the fund, including how equity and revenue participation are structured, is available through the Growth Impact Fund website and our article on the Growth Impact Fund here.

Let’s talk about growth finance

If you’re exploring growth finance and want an approach designed around impact, inconsistent income and long-term sustainability, equity or revenue participation may be worth considering.

We’re here to have an open conversation about what could work for your organisation, how growth might be funded in practice, and which structure could best support your ambitions.

This is growth finance designed for real organisations, real income and lasting change.

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FAQs

What is the difference between equity and quasi-equity?
Equity involves long-term investment with shared ownership, while quasi-equity (revenue participation) is repayable finance with repayments linked to revenue rather than profits without an ownership stake.

Does Big Issue Invest take ownership in organisations?
A share of ownership is taken only through equity investment. Revenue participation does not involve ownership or control.

How do repayments work for revenue participation?
Repayments move in line with revenue or surplus. When income is lower, repayments may reduce or pause; when performance improves, repayments increase.Who is this type of finance suitable for?
Equity and revenue participation are generally suited to social enterprises and mission driven businesses that are already trading, generating income and looking to grow their impact.