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Social Finance for Social Innovation in Wood Buffalo

Social Finance for Social Innovation in Wood Buffalo. PRESENTED BY Sean Geobey PhD Candidate, McConnell Fellow. Introductions Tell us about yourself! Name Organization/affiliation What you do Interest in this workshop. WHAT WE WILL SPEND OUR DAY DOING…. Agenda. What is a Stakeholder?.

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Social Finance for Social Innovation in Wood Buffalo

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  1. Social Finance for Social Innovation in Wood Buffalo PRESENTED BY Sean Geobey PhD Candidate, McConnell Fellow

  2. Introductions Tell us about yourself! • Name • Organization/affiliation • What you do • Interest in this workshop

  3. WHAT WE WILL SPEND OUR DAY DOING….

  4. Agenda

  5. What is a Stakeholder? • Person, group, organization, member or system impacted by program

  6. Exercise • We are going to take a high-level perspective on the question ‘Who are the key stakeholders (organizations, groups of people) that your program impacts?’. • On small sticky notes identify the stakeholders you interact with. For example, you could consider: • Public agencies • Companies or other market forces • Who would be impacted if you were not there • Our goal is to clarify the strategic context that you are working within

  7. Financial Stakeholders • What do resource-providers expect to gain? • What is risky about providing support? • Example: Bad press, seen as “waste”, etc. • Common themes

  8. Social Finance Tools • Impact Investing • Community Bonds • Social Impact Bonds • Crowd Finance

  9. Finance Production Consumption + Interest Savings

  10. What is Social Finance? • Finance with a social and/or environmental mission +

  11. Legal Forms • For-profit • Non-profit • Non-profit with charitable status

  12. Access to Capital • Equity (stocks) • Debt (loans) • Grants (donations +) • Revenue (sales of goods & services)

  13. Social Finance • [Investments] made into companies, organizations and funds with the intention to generate measurable social and environmental impact alongside a financial return (Global Impact Investment Network 2012) • $4.5 billion in Canada (Bragg 2010) • Comparison: • Canadian assets under management is approximately $3 trillion (source Mobilizing Private Capital for Public Good 2010) • Total credit union / caissespopulaires assets $304 billion (Credit Union Central 2011; Desjardins 2010) • Donations to charity total $10.6 billion (Turcotte 2012)

  14. Upcoming Activity • Each group will have a topic • Microfinance • Community Bonds • Social Impact Bonds • Crowd Funding • Teach the rest of the workshop • When would this type of financing make sense? • When would this type of financing not make sense? • Where would it be useful in Wood Buffalo?

  15. Microfinance • Small loans • 2006 Nobel Peace Prize • MuhammedYunus & Grameen Bank • Supports self-employment activities • Profitable in developing world • Coupled with other assistance in Canada

  16. Example: PARO Centre For Women’s Enterprise • Northern Ontario • Up to $5,000 loans • Multistage microfinance projects • Business coaching and mentorship

  17. Community Bonds • Debt funding to organization • Can be asset-backed • Price accessible to community • Market or below-market interest • Issued by bank or credit union

  18. Example: Centre for Social Innovation • Centre for Social Innovation (Toronto) • Funding new building • CSI had a city-backed loan guarantee

  19. Social Impact Bonds • Not a bond • Government pay-for-performance • Private financing • Handoff from philanthropy to public funding • Focus on scaling proven interventions • “Bet” between finance and government http://www.youtube.com/watch?v=E6GrQtCh83w

  20. Example: Peterborough (UK) • 2010 UK pilot – Peterborough Prison recidivism • Case management oriented • If reoffending drops 7.5% then payout is 7.5% • If more can increase up to 13.5% • If 7.5% not achieved, no payout • SIB is not finished yet

  21. Crowdsourcing • Raising small amount from many people • Online, usually donations • Often other benefits if repaid • Access to events • Early release of products • Loans and equity are difficult

  22. Example: Pebble Watch • Customizable wristwatch • Electronic watch faces • University of Waterloo / Palo Alto, CA • $100,000 goal • $10,266,845 raised • Pledges of $99+ will receive a Pebble watch • Largest Kickstarter campaign to date

  23. Activity • Discuss in your group • When would this type of financing make sense? • When would this type of financing not make sense? • Where would it be useful in Wood Buffalo? • Present findings to the rest of the workshop

  24. Social Return On Investment • Social Return On Investment (SROI) Principles • Involve stakeholders • Understand what changes • Value what matters • Materiality • Avoid over-claiming • Transparency • Verification

  25. Theory of Change • How do you impact stakeholders? • How do they view risk? • What does reporting impact mean to them? Program System

  26. SROI Process • Establish Scope & Identify Stakeholders • Map Outcomes • Evidence Outcomes and Value • Establish Impact • Calculate SROI • Report, Use and Embed

  27. 1. Establish Scope and Identify Stakeholders Use big post-its to identify 2-5 key stakeholders Stakeholder (eg. member) Program (eg. bikeshare) Stakeholder (eg. transit) Stakeholder (etc.)

  28. 2. Map Outcomes & 3. Evidence and Value Outcomes Use small post-its to identify inputs & outcomes Intervention (eg. bikeshare) Stakeholder (eg. member) Outputs (note) Shared bikes & bike stands Kilometers travelled? Inputs Membership fees Personal biking gear Outcomes (value) Increased transportation range Reduced transportation costs

  29. 4. Establish Impact &5. Calculate SROI Outcomes (With proxy valuation) Deadweight (what would’ve happened anyway) Displacement (what moved elsewhere) Attribution (how much is this activity responsible for) Drop-off (how long does the effect last) Calculate SROI (Share attributable to program)

  30. 6. Report, Use and Embed • Stakeholders and SROI • Verification • Use • Can your stakeholders benefit from reporting? • How? • Think about your strategic goals • Can reporting improve and embed your strategy?

  31. Activity: Your Social Return On Investment • In your group • Describe your program • Describe your stakeholders • Explain how the inputs and outcomes work • In pairs • Interview each other for 5 minutes each • How could your report to your stakeholders • Explain your partner’s reporting strategy to group

  32. Using Social Finance • Which (if any) social finance tools could you use? • Are there opportunities for revenue generation? • Go through each project individually • Impact investing • Community bonds • Social impact bonds • Crowd financing • Which tool did your group find most useful? • Share with whole workshop

  33. Wrap-Up • Write down • Most important thing I learned • An idea I can implement • Within your group • Go around the circle and share your answers • Are there any common themes? • Share the themes with the whole workshop

  34. Questions? Sean Geobey PhD Candidate, Environment and Resource Studies McConnell Fellow SiG@Waterloo sgeobey@uwaterloo.ca

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