The fund includes more than £1m invested by CAF and more than £300,000 by Barclays Bank. Grantmaking trusts and individual philanthropists have also made substantial donations. The investment fund is used to finance charities and voluntary organisations that are considered too risky by mainstream financial institutions.
Venturesome says it adopts a “risk capital” approach, which comprises underwriting, unsecured loans, recoverable grants and equity. Since its launch, it has committed £2.5m to 45 different charities for capital projects such as buying property.
Unlike commercial lenders such as banks, which anticipate getting a 100 per cent return on the money they invest, Venturesome has a target of 75 per cent. But so far it has achieved a 90 per cent return rate.
Director John Kingston said: “We take risks like a grantmaker, but recycle money like a lender.” He added that interest from charities in new types of financing was growing, as shown by Venturesome and the Government’s Adventure Capital Fund and Futurebuilders, which have all attracted high numbers of applications.
“We want to work our money hard, by recycling it as often as possible. We aim to help both charities and donors to achieve real social impact,” said Kingston. Venturesome also attempts to reduce the risk in investments by working closely with charity clients.
One of the organisations fin-anced by Venturesome is fatherhood information service Fathers Direct, which received loans of £50,000 both this year and in 2003.
Director Duncan Green said: “Venturesome understood what we were trying to do and helped raise the right kind of money to do it. Its development loan underpinned our growth last year, and a stand-by facility will help increase our base capital this year.”