SVA achieves $5m capital raise for Australia’s first social impact bond addressing youth employment

Social Ventures Australia (SVA) is pleased to announce it has achieved its capital raising target of $5 million for the Sticking Together Social Impact Bond (SIB) and finalised the issue of the SIB.

SVA has partnered with SYC Ltd and the NSW Government to bring to market Australia’s first SIB addressing youth employment. The NSW program is funded by the NSW Department of Industry through a $10m outcomes-based contract, with financing provided by investors through a social impact bond (SIB) managed by SVA. The 33 investors in the Sticking Together SIB include NGS Super, Light Warrior’s impact investment fund, the Wyatt Trust and clients of private wealth management firms Koda Capital and Ethinvest.

The transaction is the fifth SIB SVA has successfully completed, following bonds which are addressing diverse social issues including homelessness, mental health, and children in out-of-home care. It has attracted strong demand from investors seeking both social and financial returns and was closed significantly oversubscribed.

NGS Super continues their strong support of the social impact bond market, having invested in all five of SVA’s SIBs. The involvement of wealth management firms such as Koda Capital alongside institutional investors, foundations and high net worth individuals sees the continuing ‘mainstreaming’ of impact investing.

Koda Capital Partner, Head of Philanthropy & Social Capital David Knowles says ‘Koda is committed to helping clients build portfolios that reflect not just their financial objectives, but their values and their desire to invest in social and environmental change. With support from Australian Impact Investments, we are delighted to be playing an active role in growing the market for quality impact investments, such as those managed by a market-leader like SVA.’

The $5 million raised will finance SYC’s delivery of the Sticking Together Project, which will provide intensive coaching support over a four-year period to approximately 900 unemployed young people who face high barriers to employment. SYC will commence service delivery in the new year in the Southern Highlands and Shoalhaven, Illawarra, and the city and inner south in Sydney.

SYC developed and piloted the Sticking Together Project with the assistance of philanthropic supporters including the Wyatt Trust. Paul Madden, Chief Executive of the Wyatt Trust, says

It is very satisfying to see our philanthropic support of the genesis of the Sticking Together Project several years ago leading to this point, where we can now support its delivery at scale as an investor.’

SYC CEO Paul Edginton says

‘SYC is thrilled that investors have seen value in the work that we are doing to improve employment outcomes for young people in New South Wales. By sharing the risks and rewards, the interests of investors, the state and SYC are all aligned and focused on making a positive impact’.

SVA Impact Investing Director Elyse Sainty says she is also pleased with the interest from investors.

‘We are delighted to be formally closing this SIB after only a few months, demonstrating the strong investor demand. It’s inspiring to see the SIB model support an innovative and evidence-based program such as the Sticking Together Project, which I am confident will change the trajectory of many young people’s lives.’

The Sticking Together SIB is targeting investor returns of approximately 7% per annum. Returns are linked to the level of measured improvement in participants’ employment outcomes.

Media contact:

Tambelin Boykin, Associate Director, Communications – Social Ventures Australia