What is investment readiness?
Generating positive impact is the fundamental driver behind most mission-driven enterprises and not for profit organisations. Social and environment impact delivered at scale can be transformational for society. In Australia, there are thousands of social enterprises or mission driven businesses working to deliver the social or environmental benefits society clearly needs.
But despite the growing pool of organisations seeking to create impact, few have the capacity to deliver it at scale. Many reach a plateau because they can’t find the right advice, support and funding needed to take them, and their impact, to the next level. Meanwhile there is no shortage of investors actively seeking impact investment opportunities.
For an organisation or program to secure an impact investment, it needs to be ‘investment ready’. Investment readiness refers to the capacity and capability of an organisation to seek and utilise investment. There are various attributes that help to make an organisation investment ready including:
- Business planning and modelling
- Financials
- Governance
- Leadership
- Measuring of social or environmental impact
Support for becoming investment ready
There are different types of support available to help businesses, social enterprises and not for profit organisations access the advice they need for becoming investment ready. Examples of impact investment readiness support include mentoring; seminars and workshops; courses; and bespoke professional advice. We list some investment readiness providers here.
Impact Investment Ready Growth Grant
The Impact Investment Ready Growth Grant provides grants of up to $140,000 for enterprises with a social or environmental mission to purchase specialised capacity building support from providers – such as advisory, financial, intermediary or legal services – to prepare them for securing an impact investment. The Growth Grant was originally established as the Impact Investment Readiness Fund in collaboration with NAB and responded to a recommendation made in Delivering on Impact (2014) to catalyse the impact investment market in Australia.
In late 2018, Impact Investing Australia was selected as the administrator of the $7m Australian Government Sector Readiness Fund (SRF) to enable for-purpose businesses to grow their impact. The $7m SRF, funded by the Department of Social Services, will be managed through an updated version of the IIA Impact Investment Ready Growth Grant.
