A new venture philanthropy scheme that uses a mixture of loans, donations and commercial finance has attracted almost 80 per cent of the money it needs to go ahead, the disability charity Scope has revealed.
The Grangewood Venture Philanthropy Project, launched in June, was intended to finance the construction of 15 homes in Grangewood, Essex, for people with complex multiple disabilities.
Scope has asked each donor to contribute £2,800 and a £7,000 interest-free loan. It planned to attract 100 donations, which would be matched with a further £750,000 of commercial finance.
The appeal targeted wealthy individuals, who would be eligible to receive higher-rate tax relief of £1,050 on each £2,800 donation, meaning the net cost of a gift to the donor would be £1,750.
Tom Hall, head of philanthropy and social investment at Scope, said the project had attracted interest from individuals, as well as from trusts that had not previously given to the charity. He said he expected to use a similar fundraising tool in the future and believed it could be emulated by other charities.
"We've learned a lot from it," he said. "We will be doing it again, on a much larger scale. We've got another 60 projects that are similar to the Grangewood one, which we now plan to finance in the same way. So we'll be selling several thousand units, instead of just 100."
He said the project had convinced him that both foundations and philanthropists were keen on including an element of social investment when they made charitable donations.
"Several donors have told us that they wouldn't even have offered us the donation element if there hadn't been a loan attached," he said. "They see it as a much more effective use of their money. Foundations said they liked the scheme, but it was too small. I think we'll get much more interest if we run a bigger scheme."
Geoff Burnand, the chief investment officer at Charity Bank, which is one of the organisations interested in providing commercial finance for the scheme, said it would be emulated by other charities.
"We've already had approaches from other organisations that want to use similar models," he said. "It's a simple but innovative scheme, which attracts new donors to a charity."