When the community is the investment committee

What does the social in social enterprise, or social investment, really mean? Is it about ends, or means? About the product, or the process? Capitalising the social, or socialising the capital?

Whenever we looked at the social economy, it seemed like it was rarely a social event at all.

And we wondered what it would look like if it was.

We got to try this out in 2022, when the Curiosity Society teamed up with BD Giving in an experiment to invest the first £1m of their endowment. It became a journey about the second half of our three questions: about the means, the process, and socialising the capital.

Fast forward to today and, with some careful navigation of recent charity law that allows charities to invest in line with their objects, BD Giving and the community of Barking and Dagenham have built an investment strategy, learned where to find investments, created some tools to test them, made their debut investments, and worked on measuring how they’re doing.

In short, the community has become the investment committee.

How it happened…

Our journey with BD Giving began with a request to help write an investment policy. The question within that question, was: “can we learn how investment works, so that the people affected by financial decisions, are the people making them?”

The first stop was a bullseye model of an investment strategy, where the BD Giving community group designed what good investment looked like for them.
They spotted early that they could have better conversations if they weren’t limited to a binary yes or no. Instead, it would be more helpful to describe investments as: ‘less like that’ and ‘more like this’, which led to the invention of some sliders.

To test each of the potential investments that made it past the bullseye and the sliders of the strategy, the BD Giving community group alighted on four dimensions that mattered:

• Impact (to what extent might the investment create the impact we imagine in the strategy)

• Liquidity (can we get our money out when we need it)

• Risk (what are the chances of us losing some or all of our capital)

• Return (what might we earn from our investment)

Like the sliders, the community group wanted to be able to see the whole picture: more than one investment at a time; and the balance between the four dimensions. What better way than a 4-D graph?

All these things: the bullseye; the sliders; the 4-D graph, are nothing more than tools to help the community have better conversations about the investments they want to see, to create the impact they want to make.

The value is in the conversations; and, crucially, who is having them.