£3m Homes for Good deal with Big Issue Invest is ‘one of largest social investment exits on record’
Scotland’s first social enterprise letting agency has secured £3m of investment from Big Issue Invest – allowing early stage investor Impact Ventures UK (IVUK) to successfully exit three years early.
Homes for Good provides a solution to the lack of affordable, quality housing to people with limited housing choice in and around Glasgow, and has ambitious plans to double its portfolio and expand its model to other parts of the UK.
Since it was founded in 2013, Homes for Good has not only pioneered the social lettings agency model within the private rented sector, but has built a strong reputation in the wider social and property investment sectors. It has attracted significant backing in excess of £12m to date from IVUK and other UK investors including Big Society Capital, Charity Bank and Social and Sustainable Capital.
Big Issue Invest, the social investment arm of The Big Issue, made the most recent equity and debt investment of just over £3m from its Social Enterprise Investment Fund II (SEIF II). This is Big Issue Invest’s largest investment from its SEIF II fund to date.
Homes for Good said it represented “a landmark moment”, with IVUK securing a successful exit, having backed it in 2014. It said the fact that the deal was “finalised in what has been a tumultuous and disruptive time for everyone during the pandemic” gave it added significance.
Affordable housing
Homes for Good bridges the gap in affordable housing between the social and private rented sectors, providing letting agency services to landlords and flexible tenancy support for the people who live in its 500 homes.
Adding to its significance, the deal was finalised in what has been a tumultuous and disruptive time for everyone during the pandemic
Homes for Good's investment arm finds and purchases dilapidated properties – almost 250 since 2014 – which they bring to life through refurbishment and interior design. Homes for Good then lets these homes to people in housing need, or to partner organisations working with people with more intensive support and emergency housing requirements.
Big Issue Invest has continued to invest through Covid-19, and said it was “excited for both future collaboration opportunities with HFG and, in particular, the groundwork this lays for future funds being developed”.
Dr Susan Aktemel (pictured top), executive director of the Homes for Good Social Business Group, commented: “This significant deal clearly shows that it is entirely possible to make strong financial returns from social investment whilst putting money to good use to change people’s lives for the better.
“I am really delighted to see BII [Big Issue Invest], a perfect partner for us, become a shareholder and join the Homes for Good family. This has created a strong foundation for our future growth, and paves the way for further investment, as we embark on a £20m raise in the coming years to deliver our vision of creating high-quality, affordable homes for those who may otherwise struggle to access them.
It is entirely possible to make strong financial returns from social investment whilst putting money to good use to change people’s lives
“IVUK has for the last six years been a superb partner for Homes for Good – they saw the opportunity that I did early on in our journey, and have supported me and the Homes for Good team at every stage of our growth so far. Our shared values and vision of using investment capital to change lives has allowed us to deliver the success we have to date. It is a proud moment and a real pleasure to deliver an early exit to our first investor.”
Danyal Sattar, CEO at Big Issue Invest, said it was “especially important that organisations such as Homes for Good are able to continue their excellent work at a time of great uncertainty for those with housing needs”.
He added: “This is our largest investment out of our Big Issue Invest Social Enterprise Fund II and shows the kind of backing we can give to our partners. We like to support entrepreneurs and entrepreneurial organisations and that is what we find in Homes for Good.”
Kevin Bone, partner at IVUK, said: “Impact Ventures UK was created to back exceptional entrepreneurs building transformative businesses to address social and/or environmental issues. Susan and the Homes for Good team have clearly done that. Their impact goes far beyond the many hundreds of challenged people they have directly housed and supported, since the model has now become a lighthouse for others who are replicating it across the UK.
“In parallel, and crucially for the impact investing sector, this has been achieved whilst delivering market financial returns. It is this combination of impact depth and reach with strong financial returns that IVUK committed to its investors and we are incredibly grateful to Susan for allowing us to partner with her on the first stage of this incredible journey and for achieving those twin aims. As we hand over to BII, it is with great joy and anticipation at the achievements to come for Homes for Good.”
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