Event Recap - An Introduction to Social Investment
Thank you to everyone who joined our inspiring session exploring what social investment is, how it works in practice, and why grant‑makers are increasingly looking at blended finance to support stronger, more sustainable community impact.
With more than 6,000 social enterprises operating across Scotland, many now delivering essential services in their communities, understanding how repayable finance can complement grants is becoming both timely and important. This session cut through the jargon and offered practical clarity for funders at every stage of the learning curve.
Five Key Lessons for Grant‑Makers
1. Social investment doesn’t replace grants, it unlocks bigger, longer‑term impact
A recurring theme was that repayable finance fills a different role to grants.
Grants create stability and innovation; loans help organisations build assets, grow income and scale their services.
Used together, they can move organisations from siloed projects to expanding their social impact.
2. Blended finance is enabling transformational community projects
Many of the most ambitious local projects now rely on a mix of grants and loans.
This approach helps organisations take on long‑term assets, invest in infrastructure, and secure future income which are difficult to do through grants alone.
Case Study: Isle of Eigg Heritage Trust
The Isle of Eigg Heritage Trust used social investment to unlock new affordable homes in a fragile rural community; helping retain local jobs and tackle long‑term depopulation. Foundation Scotland provided a blended package of a £40,500 loan and £13,500 grant, closing the final 5% funding gap that traditional sources couldn’t cover. This small intervention enabled the full project to go ahead, demonstrating how targeted social investment can make community‑led development viable in even the most remote areas.
3. Communities need access to capital alongside short‑term project funding
Many social enterprises now require larger, asset‑backed loans (£100k+) as they grow.
This reflects a sector that is increasingly confident, ambitious, and focused on long‑term impact.
Social investment is giving communities the financial tools they need to purchase buildings, expand services, and create reliable income streams that strengthen their future.
Case Study: Govan Youth Information Project
A £110,000 investment enabled the purchase of premises at Bank Street which will provide a permanent base for youth services, employment opportunities and long‑term security. This single investment has changed the organisation’s trajectory from short‑term renting to owning an asset that will support multiple generations of young people.
4. Impact measurement is improving and helping funders make informed decisions
Better Society Capital highlighted how the UK’s social investment market has grown to over £3.2bn, supported by stronger tools for understanding and tracking impact.
Frameworks such as ABC (avoid harm, benefit stakeholders, contribute to solutions) and improved ESG practice are giving funders clearer evidence of outcomes, and greater confidence that investments deliver genuine social value.
5. Building confidence across both trustees and grantees is essential
Trustees may feel unsure about risk and legality, and grantees can initially see loans as “not for organisations like ours”.
The session emphasised that confidence grows through:
early conversations
accessible case studies
peer learning
small pilot investments
clear policies around when social investment is appropriate
For those interested, organisations like Social Investment Scotland, Better Society Capital and Foundation Scotland offer a wealth of practical guides, case studies and tools on their websites to explore how social investment can work in practice.
Q&A Themes: What did SGM members want to know?
How do we know if a loan is the right tool?
Use Social Investment Scotland checklists and FAQs, start conversations early, and look at the organisation’s income reliability, not just their reserves.
Are trustees allowed to use investment?
Yes - but they need support and confidence. Funders can help by sharing resources, creating learning spaces, and offering blended options.
How do we encourage grantees to consider social investment?
Frame investment around scale and opportunity, not debt.
Support with business planning, offer lighter‑touch pilot funds, and identify advisers who understand the community contexts.
Is there a minimum investment size?
Typically, around £250k, but group bids and pooled funds can make this accessible to smaller organisations too.
If you missed the live session or have follow‑up questions, please get in touch with our fantastic speakers who have said they’d be delighted to continue the conversation with any interested Scottish Grantmakers members.
Alastair Davis OBE – CEO, Social Investment Scotland
Chris Jamieson (chris@socialinvestmentscotland.com)– Head of Investment Partnerships, Social Investment Scotland
Paley Sweet (psweet@bettersocietycapital.com) – Senior Manager, Investment Partnerships & Advisory, Better Society Capital
Chris Holloway (chris@foundationscotland.org.uk) – Head of Social Investment, Foundation Scotland