Bridges Ventures backs UK adoption scheme

The deal, which is the first investment from Bridges’ Social Impact Bond Fund, comes just weeks after Bridges closed its third Sustainable Growth Fund on £125m, above its £100m target.

Socially oriented UK investor Bridges Ventures has backed It’ All About Me (IAAM), a UK adoption scheme, by investing £2 million together with UK social investment bank Big Society Capital. 

The IAAM scheme will support local authorities’ adoption services in the UK by finding, training and supporting families to adopt children who are recognised as ‘harder-to-place’ and who otherwise remain in care, Bridges said in a statement. 

Under the IAAM plan, UK adoption agencies will seek out adoptive families for children who are often overlooked because of their age, ethnic background or because they need to be placed together with siblings. The project will also offer parental training and 24-hour support in the first two years after adoption to reduce the risk of placement breakdown. The IAAM scheme plans to place 100 children per year which could rise to 300 if it can secure further funding.

The project is also sponsored by the Social Outcomes Fund, a £20 million fund which was established by the UK’s Cabinet Office to provide ‘top-up’ contributions to social outcomes-based programmes. 

We are very excited to support this pioneering project. It has the potential to provide a loving home to around 2000 children in care dramatically improving their life chances, and save authorities as much as £1.5 billion in fostering fees.

Antony Ross

“We are very excited to support this pioneering project. It has the potential to provide a loving home to around 2000 children in care dramatically improving their life chances, and save authorities as much as £1.5 billion in fostering fees,” Antony Ross, partner and head of social sector funds at Bridges, said in a statement. 

This is the firm’s first investment from The Bridges Social Impact Bond Fund. The firm launched this vehicle in April with Big Society Capital acting as a cornerstone investor alongside philanthropic investors Omidyar Network and Panaphur as well as the Bridges Social Entrepreneurs Fund.  The fund held a £14 million first close in May. 

Social impact bonds (SIBs) are intended to provide capital to social programmes. Investors fund the programmes to create a positive social impact and if the outcome is successful, payments are made by the public sector from savings made by improved social outcomes. 

Bridges analyses these ‘bonds’ much like it would a typical equity investment, Ross told PEI in July.  “The key requirements for a successful SIB are: an intervention that can deliver real measurable impact, and a team that can deliver,” he said. It works with providers much like it would work with its normal portfolio companies. “The investors need to bring a lot of hands-on support to help with the structuring and performance management, particularly in the early years when the project is being set up and launched,” he added. 

Bridges’ investment in IAAM comes weeks after the firm closed its third Sustainable Growth Fund on £125m, above its £100m target, after attracting new investors including the European Investment Fund and the London Pensions Fund Authority. Increased appetite for social impact investing, combined with the fact that Bridges had four very strong exits in the last year, resulted in a successful fundraise, the firm’s Michele Giddens, co-founder of Bridges Ventures, told Private Equity International at the time. 

Read more about Bridges Ventures in PEI’s forthcoming November issue, in which we look at Bridges’ recent investment in low-cost gym operator The Gym.