EIF signs first social impact investing deal with Bridges Ventures to support social and environmental impact businesses and innovation

The EIF announces its investment in Bridges Ventures Fund III, a UK-focussed sustainable growth investor which held its first closing at £72m. This is EIF’s first commitment into the impact investing segment and illustrates its willingness to support European social entrepreneurship and innovation going forward. 

Bridges Ventures will target ambitious businesses across four key impact themes: Underserved Areas (meaning economically deprived areas); Environment; Education & Skills and Health & Wellbeing, where underlying social or environmental problems create an imperative for change and attractive growth opportunities for entrepreneurial businesses. 

Through the success of its two predecessor funds (Bridges I and II, with similar investment strategies), Bridges Ventures has demonstrated that achieving high social or environmental impact and generating strong financial returns can be achieved in parallel.

With this milestone transaction, EIF backs an experienced and key investor, who will stimulate entrepreneurial growth and enhance employment by investing in a portfolio of 15 to 20 promising businesses addressing social or environmental issues.

Richard Pelly EIF’s Chief Executive said: “The Bridges Ventures team has successfully supported enterprises in the social and environmental sector in the UK over many years and has helped them grow and develop. As the single largest investor in the first close of Bridges Ventures III, EIF will pursue a key European Union objective to develop social entrepreneurship”.

Philip Newborough Managing Partner at Bridges Ventures, said: “We are delighted that EIF has joined our first close as a substantial new investor; particularly given EIF’s interest in impact investment.   To have achieved a successful first close in a difficult fund-raising environment sends a strong signal that, increasingly, investors understand that generating positive environmental and social impact can drive attractive financial returns as well as making a difference.”

This important backing by EIF of a pioneer in the impact investment space marks EIF’s intentions to become an important player in this emerging asset class.  Going forward, EIF is considering setting up a new fund-of-funds initiative dedicated to social entrepreneurship and innovation, the ESIEF (the European Social Innovation and Entrepreneurship Fund). The ESIEF will have cornerstone backing from the European Investment Bank and is now raising funds from private investors.

With its investment EIF aims to catalyse and attract private investors’ interest into this emerging and innovative asset class.

About EIF

EIF's central mission is to support Europe's micro, small and medium-sized businesses by helping them to access finance.  EIF designs and develops equity (venture and growth capital), guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. EIF’s equity investments aim to leverage its own funds and those managed on behalf of mandators.

EIF’s total net commitments to private equity funds amounted to over EUR 5.4bn at end 2010. With investments in over 350 funds, EIF is a leading player in European venture due to the scale and the scope of its investments, especially in high-tech and early-stage segments. EIF’s commitment in guarantees totalled over EUR 14.7bn in close to 180 operations at end 2010, positioning it as a major European SME loan guarantees actor and a leading micro-finance guarantor.

Contacts:

• EIF: Joelle Harvey, Communications, j.harvey@eif.org