Nesta, UK’s endowment for innovation, announced the launch of the Nesta Impact Investments, an impact investment fund for social ventures.
More than £17.5 million have been made available for the first closing last Tuesday. Nesta has contributed £8 million and have raised £8 million from Big Society Capital and $2.5 million from Omidyar Network. Nesta has a target of £25 million for the fund.
They are searching for social enterprises with a high potential for social impact coupled with a financially viable business model to produce a return on investment.
For equity investments, Nesta expects to receive a 15-25% IRR. Interest rates for debt investments will range between 8-10%. Once an investment agreement is made, Nesta will charge a completion fee, reimbursement of any legal expenses incurred up to an agreed cap, and an on-going monitoring fee. Investments range between £100,000 and £1 million in any one funding round.
Nesta is looking particularly for those with a positive impact on:
Investments will be for a period of 4-8 years.
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