Big Society Capital announced the launch of its new “Crowd Match Fund” on 7 December. The Fund will provide up to £10 million in match funding from BSC to social enterprises raising money from crowdfunding investors. The projects must be eligible for SITR, and be listed on three platforms chosen by BSC as partners in the Fund – Ethex, Crowdfunder and ThinCats. According to BSC, the Fund will be the first of its kind to match different investments made by the public across the social sector. The Fund will operate across different forms of investment and organisation – including withdrawable shares in community benefit societies to loans issued by community interest companies.
BWB have advised on one of the first projects to take advantage of this initiative. Southville Community Development Association is a charity working in south Bristol. For years it has operated a successful nursery which has subsidised other valuable community activities and SCDA has successfully attracted funding from a variety of sources to purchase and redevelop another property in the locality to become a second nursery. SCDA want to give local people the chance to support the new nursery, and receive a return on their investment, and so issued a bond in January aimed at retail investors. The bond is eligible for SITR and Big Society Capital has agreed to match amounts raised up to £280,000. The bond reached its target within a week, demonstrating the appetite for SITR eligible investments into the sector.
Changes to the criteria and limits to SITR were recently announced in the Autumn Statement, and are due to come into force in April 2017. You can read more about the changes here. At the time of writing, Government is currently consulting on the technical rules.
Posted on 23/02/2017 in Legal UpdatesBack to Knowledge