Business Angels are in my experience a sociable crowd who like to get together not just for pitch evenings and other networking events but also a great range of social activities. One of the great benefits of Angel investing is that it helps to bring people together.
Now social investing has a completely new meaning with the introduction of Social Investment Tax Relief. This offers tax breaks similar to EIS tax relief for investment in social enterprises. It is estimated that the third sector (charities and social enterprises) represents about 10% of the economy and social enterprises undertaken a vast range of activities to help those in need in all sorts of different ways.
Social investment is not about philanthropy or charitable giving – it is all about making small investments in social enterprises which may not offer the same prospect of high returns as a high tech start up but carry a much lower degree of risk.
Social enterprises are generally structured as companies limited by guarantee or community interest companies. The investment is typically made by way of a loan attracting EIS relief at the outset and interest typically in the range of 5/10%. The capital sum may not be repaid during the initial three year period but thereafter it may, at least in principle, be returned at the end of the three year period.
For those who are interested in investing with a social impact, social investment is well worth a look.