Cabinet Office - adventure capital

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Adventure Capital Fund
Last update: 05/10/2006



Key information

Funding area: England
Status: Open for applications





Full scheme details

Start date:
01/12/2002

Outline:
The Adventure Capital Fund (ACF) is a unique partnership between three government departments, several Regional Development Agencies and leading players in the field of social and economic regeneration, all of whom are dedicated to the development of long term sustainability of community-based enterprises in areas where traditional market forces fail to apply. The aim is to fill the investment gap that faces community enterprise organisations, and to increase investment-readiness of community organisations wishing to move to greater sustainability through enterprise.

Total Fund Value:
£ 10,000,000

Grant Value - notes:
Prospective applicants should be aware that this fund primarily provides loans rather than grants.

Extended Description:

The ACF's general investment principles are:

To provide loans, funding and some gift capital to fill the gap between traditional grant aid and commercial loans (such as those from Banks or other lenders).
To encourage organisations to use different types of finance, and to begin to move away from relying on grant support in the long term.
To be flexible enough to respond to the needs of each organisation.
To focus on the financial and social returns from the investment rather than on monitoring activities.
To share risk. Some projects which are relatively high risk will receive investment, providing this is balanced by the potential for high financial and social return. All organisations which receive investment will be worked closely with to maximise the chances of success, manage risk and protect the investment.
To work with organisations to develop impact evaluation, of value to both ACF and the organisation.

ACF are looking for applications from organisations that feel they are ready to use the investment as part of a finance package that will enable them to grow and become truly sustainable. ACF would not normally cover the total cost but supply funding as part of a mixture of finance (which can be raised from other sources, e.g. grants, funding from Banks or Community Development Finance Institutions). ACF will assess each investment individually, but intend mentoring, business advice and support to play an equal part with funding in their investment.


Further Information:

Organisations must be close to investment readiness and able to demonstrate their viability, and long term ability to generate funds to re-invest in the local community, as well as to meet any financial commitments. Investment readiness can take a number of forms but in general ACF would expect the following:

a credible and tested business plan
in-house systems and structures to successfully manage the enterprise
highly competent people to deliver the enterprise
any other required finance in place
resolved any legal and other issues (for example planning)
where appropriate, a realistic timetable for starting and completing a project, for example a building construction or refurbishment.

If these conditions are met ACF will work with the organisation to reach a point where an investment can be made and the organisation is in the best position to use the investment. This support would normally be provided by a mentor who would work directly with the organisation.

Once an investment is made, ACF will continue to support the organisation when and if assistance is needed with development, culture change and delivery issues. ACF will also work with the organisation to develop management tools that can be used to track progress against the organisation's aims and ambitions.


Key Criteria:

ACF will only accept applications from organisations who meet all the criteria listed below:

You must be an organisation: individuals cannot apply. An organisation might take the form of a Company Limited by Guarantee (CLG), with or without charitable status, or any other recognised structure.
You must be working within a local community, which can be defined as a place (e.g. inner city, small town, rural district etc) and people (e.g. you work with local refugees, groups of disadvantaged young people etc).
You need to be independent and community-led, not controlled by the private or public sector.
You have to be working in England.
You need to be involved in enterprise. This can be trade or any other income-generating activity, where you are intending to make surpluses that will be re-invested for the benefit of your community.
You must have a track record of delivering to your community.
You must be able to plan and deliver successful community based enterprise activity.
ACF will not normally invest in organisations that have been running for less than a year. Your enterprise, however, might be a new activity for you that will contribute to the longer term growth and/or stability of your organisation.

Priority Areas

Applications are welcome from any organisation that meets the core criteria, but ACF are particularly interested in hearing from:

organisations that are or could become community anchors
organisations led by members of Black and or Minority Ethnic communities (BME)
rural organisations
organisations that are pioneering new ways of working
organisations that can demonstrate excellence in what they do and inspire best practise in others, for example, some of our investors act as mentors.



Eligible Expenditure:

Potential applicants should be aware that the Adventure Capital Fund is not a grant fund. ACF can make a variety of investments, depending on your needs, such as:

Seed capital: for pre-launch costs and start up expenses, product development, or investment in systems/equipment needed to improve business operations.
Working capital: to strengthen cashflow during gaps in grant/revenue funding or to finance stock, debtors etc.
Major investments: for asset development, including purchase of buildings or land, refurbishment costs etc.

You can apply for more than one type of investment but ACF funding has to be tied to a specific enterprise activity - general running costs cannot be funded.

Applications may be received from organisations with real potential and the scope to deliver great benefits to the local community, but who need more substantial support before an investment can be made. In these cases, and at ACF's discretion, some grant or bursary funding may be awarded towards this work in addition to the mentor support. Being offered a grant is not a guarantee that ACF will be able to make a full investment, although this will be one of the joint aims. You cannot now apply directly for a grant.


Previously awarded funds:

Some examples of previously successful projects can be found on the Adventure Capital Fund website at http://www.adventurecapitalfund.org.uk/casestudies/index.jsp (opens new window)


Application Procedure:

Applications are invited from Community Organisations that already, or are about to, undertake enterprise activity in England. Prior to completing an application form, prospective applicants will need to demonstrate that they fulfil the criteria by completing an eligibility quiz. Once the quiz has been completed successfully the application form can be accessed. For more information and to access the quiz and application form, go to the ACF website at http://www.adventurecapitalfund.org.uk (opens new window).

There is no closing date for applications, and organisations can apply at any time. Applications will be evaluated on a rolling basis, but it can take up to six months to complete an assessment and reach a decision. All main investment decisions are made by an investment panel (comprised of a mix of independents and partners) which normally meets quarterly.


Contact Information:

Stacy Francis
c/o Local Investment Fund
7th Floor, Ibex House
42-47 Minories
London
EC3N 1DY

Phone: 020 7488 3455
Email: info@adventurecapitalfund.org.uk
Web: http://adventurecapitalfund.org.uk