Impetus-PEF launches record philanthropy fund

A venture capital fund backed by industry professionals will work with three UK charities focused on education and employment for underprivileged youth.

Impetus-PEF (The Private Equity Foundation) has raised nearly £8 million for venture philanthropy, a record in England, Impetus co-founder Nat Sloane told Private Equity International.

The venture philanthropy partnership will distribute leveraged funding of over £2 million to Action Tutoring, almost £3.5 million to Resurgo and about £2.5 million to The Access Project. The three charities are focused on providing access to education and employment for disadvantaged UK youth.

Venture philanthropy, an idea that emerged in early 2000s, focuses on impact- and responsibility-driven investments via direct involvement with charities.

“My original intent in setting up Impetus was that we wanted to do more than write a check,” Sloane said. “Money is part of the answer, but there are lots of issues about developing an organization that requires a range of skills.”

Impetus-PEF seeks to work with organizations with strong potential in five pillars: leadership, strategy and planning, impact, performance management and funding.

Impetus-PEF will work with each charity for three years to help recruit personnel for operations and perform evaluations on agreed target objectives, said Sloane.

“We build our support packages and approach around the idea of really understanding and evaluating how programs are working,” he said, in order to ensure “how they can be delivered reliably and consistently over time.”

Funding for this package came from individuals, a lot of whom are in private equity financial services, and corporations: PE firms such as Apax and KKR have contributed, as well as service providers like PwC and Deloitte.

Impetus-PEF also has partnerships with some large grant-making foundations, according to Sloane. About one-seventh of the total fund comes from these trusts, Impetus-PEF chief financial officer Richard Lackmann told PEI, and another one-seventh from events sponsored by charities that private equity professionals take part in and make donations at.

Funding commitments made to Impetus-PEF are honored over a multiyear basis, usually between three and seven years.

Impetus-PEF currently has about £10 million in annual income, of which £7 million is in cash and the rest is earned through pro bono support from partners like KKR and PwC. The charity is seeking to double its income in the next four years, targeting between £13 and £14 million for 2018, Lackmann said.