Social Finance (US non-profit organization)

This article is about the US non-profit organization. For its UK counterpart, see Social Finance Ltd.

Not to be confused with the US for-profit company known as SoFi.

Social Finance

Founded	2011
Headquarters	Boston, MA
Leadership	Tracy Palandjian, Co-Founder and Chief Executive Officer Lara Metcalf, Managing Director Jeff Shumway, Vice President of Advisory Services Navjeet K. Bal, Vice President and General Counsel
Board of Directors	Bracebridge H. Young, Jr., Chair Mariner Investment Group Sonal Shah, Vice Chair Case Foundation, Harvard Institute of Politics Sir Ronald Cohen Big Society Capital, G8 Social Impact Investing Taskforce^[1] Pamela Dippel Choney Former Wellington Management Company Alexander Friedman GAM Holding AG Edward L. Shapiro PAR Capital Management Laurene Sperling Sperling Family Charitable Foundation Sandra A. Urie Cambridge Associates Nancy Zimmerman Bracebridge Capital
Website	www.socialfinance.org

Social Finance, Inc. is a nonprofit organization focusing on the emerging field of Pay for Success (PFS) financing (also called a Social Impact Bond (SIB)) in the United States. Social Finance provides advisory, social investment, and active performance management services to public- and private-sector partners seeking to drive more resources to social programs that deliver proven results to those in need. The organization has offices in Boston, MA and Austin, TX.

History

In January 2011, David Blood (Generation Investment Management), Sir Ronald Cohen (Global Social Impact Investment Steering Group and The Portland Trust) and Tracy Palandjian founded Social Finance as a sister organization to Social Finance, Ltd., which pioneered the PFS model and launched the first PFS project in 2010. The organization was started in Boston, MA, and added an Austin, TX, office in 2015. Its founding supporters include Omidyar Network, The Pershing Square Foundation, and The Rockefeller Foundation.

Tracy Palandjian has served as Social Finance’s CEO since its founding in 2011. She is a leader in the field of impact investing, and currently serves as Vice-Chair of the U.S. National Advisory Board to the Global Impact Investment Steering Group (previously the G8 Taskforce), which aims to catalyze the development of the social impact investment market. She is a frequent speaker and writer on impact investing and social innovation, and has been covered in The Wall Street Journal, The Economist, Forbes, and The New York Times, among other media outlets. She is the co-author of Investing for Impact: Case Studies Across Asset Classes, a report that provides a view on the evolution of the impact investing industry.

Core activities

Social Finance’s mission is to mobilize capital to drive social progress. It partners with governments, nonprofits, foundations, impact investors, and financial institutions to create financing solutions to improve social outcomes. Since its founding, the focus of Social Finance’s work has been on building the market for Pay for Success, a funding model created to address the challenging dynamic of complex social problems, persistent government funding shortfalls, and cash-strapped nonprofit service providers. Pay for Success sits at the nexus of impact investing and the “funding what works” movement, and has garnered sustained interest among diverse stakeholders. Social Finance’s core activities include advisory services, social investment, and active performance management as well as field building and market education. The services are described below.

Advisory Services: Social Finance partners with governments and foundations to assess promising programs that could benefit from Pay for Success financing.
Social Investment: Social Finance develops Pay for Success projects that improve social outcomes and generate financial returns. It mobilizes capital to support Pay for Success projects and put capital to work in service of society.
Active Performance Management: Social Finance works to ensure its projects stay on track and drive positive results for communities in need.
Field Building and Market Education: Through research, advocacy, and publications, Social Finance supports the development of the Pay for Success market and the broader impact investment movement.

Together with Social Finance UK and Social Finance Israel, Social Finance is part of a Global Network. The Global Network collaborates to advance Pay for Success and similar efforts worldwide.

Project Examples

New York State
In December 2013, Social Finance and its partners launched a Pay for Success project in New York with the goals of increasing employment, reducing re-incarceration, and improving public safety. The project will expand the Center for Employment Opportunities, a comprehensive employment intervention, to a target of 2,000 formerly incarcerated individuals over a period of 5.5 years. The $13.5 million financing was syndicated to individual investors via a wealth management platform (Bank of America Merrill Lynch), the first Pay for Success project to take this approach. Social Finance will continue to provide active performance management and investor relations through the end of the project in 2018. ^[2]

National Partnership with Nurse-Family Partnership
Social Finance and Nurse-Family Partnership’s National Service Office work together to expand Nurse-Family Partnership’s home visiting services for low income, first-time mothers. Currently, the two organizations are developing and exploring Pay for Success projects in multiple jurisdictions throughout the United States.

Philadelphia
Working with the office of Philadelphia Mayor Michael Nutter, Social Finance explored the feasibility of improving recidivism and child welfare outcomes through a Pay for Success transaction. The final report was made publicly available.

References

External links

Official website

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