In the early 2010s, many a bold claim was made about the potential of social investment. No less a person than David Cameron, then Prime Minister, got in on the act, saying at the launch of Big Society Capital in 2012 that, just as finance from the City had been essential to help businesses grow, "so finance from the City is going to be essential to helping tackle our deepest social problems".
Fast forward a few years and, although the social investment sector was worth £2bn by the end of 2016, according to BSC, its breakthrough into the mainstream has yet to materialise. The National Council for Voluntary Organisations' UK Civil Society Almanac 2017 shows that almost 80 per cent of the charity sector's income of £45.5bn came from either public donations or the government in 2014/15.
One senior person in social investment, who asked not to be named, told Third Sector that social investment had failed to achieve much of what was expected at the beginning of the decade: "Did it provide a lot of really patient, low-priced finances for small, struggling, front-line organisations? No, I don't think it did - not by any stretch of the imagination.
"I wouldn't say it has been a failure: I think it has succeeded, but not necessarily in the areas we would have hoped for. I think now it is more of a question of where it should aim itself."
This figure also says social investment and social investment bonds were overhyped at the outset, and SIBs in particular have proved to be a niche tool for charities. It is telling that despite claims by the government that SIBs would be worth £1bn by 2020, they received only £14m of investment by the end of 2015, according to BSC.
The senior source says that no single organisation is to blame for the underperformance of social investment. Instead, says this person, it is a collective failure: the sector became too inward-looking and bogged down in technicalities and products rather than serving "the needs of those we were trying to serve". Equally, charities have not been told adequately how they can benefit from social investment, and the sector "doesn't quite have the right recipe of finance that is useful to the majority of front-line organisations", the source says.
"There are an awful lot of good people in social investment who would be the first to recognise that it has not achieved what we first hoped," the source says.
"Every single person I've come across in this space is here trying to get front-line organisations more access to more money, and are frustrated they have not achieved that at much more scale and at a much more granular level then we have."
However, according to the recent Cass Business School report Social Investment as a New Charity Finance Tool: Using Both Head and Heart, social investment is growing at a rate of 20 to 30 per cent a year, and 60 per cent of the 190 charities that responded to its survey said they saw social investment "as either positively changing their business models or being transformational to them".
The report concludes that a lack of understanding among charities about what social investment actually is and what it entails is the biggest barrier to the industry's growth, but calls it a "growing and vibrant market".
Mark Salway, director of social finance at Cass and author of the report, says he is unconcerned by the speed at which the social investment market is growing, but does have some views on how to take it into the wider charity sector.
"It takes time to grow a market with a new idea and a new concept," he says. "I'm not worried about it in the slightest. What I am worried about, though, is whether we have just taken the low-hanging fruit and now we have a market that will take real effort to grow."
Hazel Blears, a former Secretary of State for Communities and Local Government when Labour was in power, now chairs the Social Investment Business, which makes loans and grants available to charities and social enterprises. She believes social investment has largely succeeded in encouraging mainstream lenders to provide investment to the voluntary sector.
"I think it has worked to some degree, and the social investment that has gone out of the door has often made a real difference to people's lives," she says. "I'm certainly an advocate of social investment, but I think it could be improved even further to make it accessible to the people who make a difference at the sharp end."
Seb Elsworth, chief executive of Access, which supports smaller charities and social enterprises to gain access to social investment, says the idea that social investment could replace grants is "a really over-simplistic narrative" and accepts that it was at first overhyped. But he says the hype did at least raise the profile of social investment.
"I think it's fair to say that some of those predictions and expectations were unrealistically high," says Elsworth. "I think what we're learning now is more about where social investment can best help different charities and social enterprises, and where it isn't relevant and won't ever be relevant."
Cliff Prior, chief executive of BSC, which has a mission to grow the social market, says social investment has already been a "game-changer" for hundreds of charities and social enterprises and could be for thousands more. He says that the focus of social investments on revenue and surpluses is largely a new thing for many charities, which has had an impact on its popularity in the sector.
Prior says social investment is not a replacement for fundraising, grants or contracts, but is a useful tool among the many that are available to charities. He says much of the hype from the government was crucial for raising the profile of social investment.
"When the flag was planted high for social investment, it was at a time when massive austerity and cuts came in, and I think it was that combination that caused the backlash," says Prior.
"If you're a charity and you can't keep really vital services going, and you're having to say no to vulnerable beneficiaries, you're going to feel angry. And that is entirely understandable.
"But if that flag hadn't been planted high, you wouldn't have got anything done. You have got to have that sense of ambition. Maybe the flag was labelled in the wrong way: it was more about how social investment works, when what really matters is how many people's lives it improves."