FAQs

It was becoming increasingly obvious that there were issues with short term funding for the voluntary sector which made it very difficult to plan strategically and to deliver sustained work on particular issues. By targeting investment at specific issues it is possible to track the changes that result, but this does need a long term approach. It also allows evaluation of results over a long period of time, which gives a much better view of what works and what doesn’t. There are also many people who would like to become involved in philanthropic activity but who either weren’t sure how to do this or did not want to set up their own independent foundations, so Inspiring Scotland also provides a vehicle for their philanthropy.

Venture philanthropy is a field of philanthropic activity where private equity / venture capital models are applied in the non-profit and charitable sectors. There are many different forms of venture philanthropy but the European Venture Philanthropy Association believes it can be characterised as:

• The active partnership, or engagement, of donors, volunteers and/or experts with charities to achieve agreed outcomes such as organisational effectiveness, capacity building or other important change;
• The use of a variety of financing techniques in addition to grants, such as multi-year financing, loans or other financial instruments most appropriate for a charity's needs;
• The capability to provide skills and/or hands-on resources with the objective of adding value to the development of a charity;
• The desire to enable donors to maximise the social return on their investment whether that be as a financial donor or as a volunteer of time and expertise.

We’ve got a whole range of investors and supporters, from individuals to Trusts and Foundations, businesses and the Scottish Government, and we’re extremely grateful to all of them. Some invest substantial amounts of money, others time and expertise, and some do both. All investors receive regular reports and can spend time meeting the ventures whose work their investment is supporting.

Our financial investors make a substantial three year rolling commitment to a particular fund. Many other people and organisations support our work through in-kind giving or reduced fee services. All of these are valuable to the ventures we are working with.

The Scottish Government is investing money in Inspiring Scotland’s 14:19 Fund, and is keen to understand the difference our approach is making. What we learn about what works and what doesn’t is fed back to Government so that it can influence future policy.

They are completely independent, and bring a huge range of skills and experience.

We have a team of Performance Advisors who each work with a group of ventures. This lets the organisations build strong relationships with us and lets us really get to know the organisations and what they are delivering. This means we are well placed to offer support if this is required and the ventures know exactly who their main point of contact is. Each of the ventures has to meet challenging targets before their funding is released, and their Performance Advisor works with them to set these targets, monitor progress and provide tailored support and capacity building.

One of the reasons Inspiring Scotland was set up was to address the issue of charities having to meet very different requirements from a whole range of different funders. We’ve got a close relationship with all the ventures we are investing in, and do our very best to make sure we are helping them deliver as opposed to causing them extra work that distracts from this. From the start we have been extremely aware that we are not the only people funding the ventures, so have tried to balance making sure we get enough information to make informed decisions about future investment with what is best use of their time and resources.

Inspiring Scotland grew from within the voluntary sector, so was started by people who really understood the issues faced by voluntary sector organisations and the people they support. This is different to most other venture philanthropy organisations which start from the business community and then engage the voluntary sector. Inspiring Scotland has also attracted investment from the Scottish Government. To the best of our knowledge this public sector involvement is unique within the venture philanthropy arena. We felt it was extremely important that private money was not taking the place of the public sector in addressing major social issues, and that a much stronger partnership could be developed if public sector investment was involved.

Our model is simple: we raise philanthropic funding and invest it in a selected portfolio of charitable ventures. Rigorous performance monitoring ensures we achieve maximum return, just like any commercial investment fund.

The team draws together experience from the public, private and voluntary sectors. This is important as it brings balance to our approach and means we really understand the context in which our work is being delivered. Andrew Muirhead, the Chief Executive, has many years experience of leading Scotland’s largest independent grant-making trust along with senior level banking experience. It is this mix of business and voluntary sector experience that forms the basis of Inspiring Scotland’s approach.

We build investment from a range of investors, bringing together a mix of public, private and voluntary sector funds. This means that there is always a mix of investment, and investors are buying into a particular fund which is managed by an independent Board who are responsible for decision making.

Investors are buying in to a particular fund; the decision about which organisations receive investment through different funds is made by Inspiring Scotland’s Board of Directors.

That varies from person to person and it is completely up to each investor to decide the level of involvement they would like. Some purely want to invest money and receive reports on how effectively it has been used; others want to go and visit ventures and may become involved in mentoring a particular organisation or offering other in-kind support. We also hold events for investors where they can meet each other and the ventures.

Quite simply we want to change people’s lives for the better through significant long term funding and development support for Scotland’s charities. Robust evaluation lets us know what is working so everyone involved can build on success and improve results.

The 14:19 Fund aims to significantly reduce the number of 14 to 19 year olds who struggle to make a successful transition between school and education, training or work. We’re doing this by investing in co-ordinated delivery of targeted work by the voluntary sector over the next 7-10 years. Our investment in different areas of Scotland is proportional to the need.

Future funds will address other areas of social need.