Only 15 per cent of applications to a Nesta fund to invest in innovations to help older people, children and communities, came from charities and no charity has received money from the fund yet.
Nesta launched the £17.6m Impact Investments Fund in November 2012 and so far has only invested in companies with a commitment to demonstrating social impact. So far Nesta has received more than 400 expressions of interst but with only 15 per cent coming from charities it convened a roundtable to explore why and has produced a report summarising the reasons for the lack of interest.
Isabel Newman, impact investment analyst and report author, said: “We know some charities are fantastic at using tech but others are telling us that they really struggle to grow the impact of their innovations, especially when it comes to getting the funding they need.”
The report found that securing funding was proving difficult for charities and calls on funders to create new sources aimed at charities using technology. It also urges funders and impact investors to work more closely together.
It also urged charities to share their experiences and create more resources to help educate trustees.
A number of examples of good uses of technology are highlighted in the report including Catch22 which recently developed an app. Lucy Kavanagh, head of marketing at Catch22, said: “We had to ensure we weren’t being distracted by the fact we were ‘developing an app’ and stay focused on the impact, reach, and efficiency of Plan.Do, and ultimately the need for it to actually make people’s lives better.”
Five key findings
- The importance of strategy and focus – digital products need to be connected to the main organisational strategy
- Charities need new skills – either by recruiting new people or by freeing others’ time to focus on a new project
- Need for trustee and senior management buy-in – having a trustee with a technology background and educating colleagues about the project can help get everyone in the organisation on board
- The role of partnerships and support – larger charities or accelerator programmes can be a good source of support
- The importance of planning funding and the role of impact investment – the report found that “trustees may need educating in order to feel comfortable taking on social investment”.
