Over the past decade, Social Finance has pioneered the field of Pay for Success (PFS), a set of outcomes-based financing strategies that directly and transparently link resources to impact. Our social investments team helps design and implement PFS projects that leverage catalytic capital to drive social change, including Social Impact Bonds (SIBs) and Career Impact Bonds (CIBs).
PFS sits within the broader impact investing field, a growing global movement that currently represents $715 billion in assets under management. While all impact investments aim to generate both positive social and financial returns, PFS tools are unique in that financial returns are dependent on impact, and impact is based on measurable outcomes rather than outputs.
Our team partners with governments, service providers, foundations, impact investors, and financial institutions to apply PFS financing strategies across a range of issues, including workforce development, criminal justice, child and family well-being, education, health, homelessness, and environmental sustainability.
As a PFS intermediary, Social Finance acts as a coordinator and project manager, working with project partners to:
- Drive project design, from identifying target populations and outcomes to defining implementation and evaluation plans
- Identify financial structure, from modeling project economics to assessing risk
- Develop, negotiate, and execute outcomes-based contracts
- Raise necessary capital for the project from a range of impact investors, including financial institutions, foundations, donor-advised funds, and individuals
- Establish and implement strong governance and accountability systems, to support project partners to integrate real-time data and decision making to achieve success.
Currently, Social Finance is one of the only firms within the PFS market that stays involved for the entire life of the project. We believe that this end-to-end engagement best positions PFS projects to achieve social and financial returns.
The UP Fund
In 2019, Social Finance also became a fund manager, launching the UP Fund, a $40 million pool of impact investor capital to improve economic mobility. Learn more about our fund >>
If you are interested in learning more our investment work, contact Vice President Jackie Khor.