• Arts Impact Fund has supported 22 arts organisations with £7 million over the past three years, confirming the value of social investment in the arts
• Launched in 2015, the Fund announces its final round of investment, supporting six arts organisations in England with more than £2 million

The Arts Impact Fund today announces its fourth and final round of investments, demonstrating the value of social investment for the arts and cultural sector. The Fund has provided £7 million across 22 organisations in England, through four rounds of investment in three years. Launched in 2015, it was the first impact investment fund targeting social outcomes in the arts and cultural sector, anywhere in the world.

The £7 million pilot Fund was established in spring 2015 to test the idea that there is demand for social finance in the arts and cultural sector, as well as credible business models that can generate cash to repay the investment. The bespoke finance offer made available by the Arts Impact Fund was designed to be used by organisations to become more financially resilient, in order to protect and develop their social and artistic impact.

The Fund brings together private, public and philanthropic investment from Bank of America Merrill Lynch, Esmée Fairbairn Foundation and Nesta, and Arts Council England with additional funding from the Calouste Gulbenkian Foundation.

Over the last three years, the range of projects financed and the positive social impact generated has largely validated these assumptions. The demand for finance has been echoed by a March 2018 survey of 1,068 arts organisations commissioned by Nesta.

The survey, Repayable finance in the arts and cultural sector, revealed that UK arts and cultural organisations could be set to seek £309 million in repayable finance over the next five years - more than double over the next year than during 2016. Organisations indicated that the sector could seek over £62 million per year, compared to £29 million in 2016.

The final cohort of investees announced today are:

• Resonance (£300,000) - A music education charity, to support the launch of a new contemporary music institute that provides vocational industry-led higher education, validated by Manchester Metropolitan University, and a community music hub for the Black Country.
• Central School of Ballet (£600,000) - A London-based ballet school, to provide working capital towards the cost of fitting out and opening their new premises in autumn 2019, increasing the capacity of the school and their work with local communities.
• Looe Music Festival (£165,000) - A charity running the annual music festival in the town of Looe, Cornwall, which is at the forefront of economic and cultural regeneration in south east Cornwall, with a loan to support the 2018 edition of the festival.
• National Holocaust Centre and Museum (£200,000) - A centre dedicated to Holocaust remembrance and genocide education, to help cover current development funding shortfall and enable venture revenue streams, supporting the financial resilience and growth of a historic institution.
• Project INC (£208,000) - Alternative education initiative providing inclusive and creative learning for disengaged 11-19 years olds, to open four new centres in the North West over the next two years.
• The Old Courts (£590,000)- A fast-growing arts centre in Wigan, to acquire and renovate a nearby derelict former hotel, expanding its work and creating an arts hub in an area in need of cultural engagement.

Examples of organisations from the first cohort of investees, who participated in the Fund from 2015-2018 and significantly benefited from the investment include Titchfield Festival Theatre, a charity-run amateur dramatics theatre based in Hampshire and operated entirely by volunteers. Since drawing down funds in early 2016, the Theatre has nearly completed its refurbishment of a new performance space, renewable energy systems and better audience facilities. The improved facilities have resulted in an uplift in audience numbers, more people volunteering their time to support the theatre and an increased capacity to work with community groups. Altogether this contributes to a greater sense of belonging, community cohesion and individual wellbeing for local residents.

Another beneficiary is South East Dance in Brighton, which plays a national leadership role in the development of dance. The organisation drew down its loan in the spring of 2017 and has since started construction of its new dance studios and headquarters, set to open in early 2020. The new state-of-the-art facility will strengthen the cultural infrastructure for dance in the South East and provide crucial opportunities for local communities of all ages and backgrounds across Brighton to benefit from the health and wellbeing aspects of dance.

In the build up to its opening, on 21 and 22 July 2018 South East Dance will also present the inaugural Our City Dances festival, a two-day celebration of dance across Brighton for people of all ages and abilities, which will grow year on year as the move toward The Dance Space nears.

Both Titchfield Festival Theatre and South East Dance have shown a strong record of meeting and in some respects exceeding the social and artistic impact targets that were agreed with the Fund as part of its investments.

The six organisations announced today will report quarterly to Nesta on their artistic, social and financial impact for the duration of their loans, and the Fund will share findings from its portfolio.

The Fund was convened with the help of the Cabinet Office, to demonstrate the significant social value created by arts organisations and support their work through loan finance. The Fund’s aims were subsequently supported by the government’s Culture White Paper in 2016, which observed that social investment can help grow the sector’s resilience and sustainability.

Fran Sanderson, Director of Arts & Culture Programmes and Investments at Nesta and on behalf of the Arts Impact Fund, said:

“Over the past three years, the Arts Impact Fund has provided crucial, and often otherwise unattainable, financial support for 22 arts and cultural organisations as well as a range of support, advice and signposting to many others. While big swathes of the sector have been hamstrung by funding cuts, particularly from cash-strapped local authorities, we believe this funding has enabled these organisations to plan across a longer time-horizon, invest in their own future sustainability and generate an invaluable social impact. Issues ranging from youth mental health to loneliness and lack of community cohesion, are addressed via the power of arts and culture to encourage empathy and belonging.

“The range of investee organisations demonstrates a diverse and exciting appetite for this kind of repayable finance. The clear benefits the model has for supporting enterprise, ambition and innovation within the, arts and cultural sector will, we think, continue to generate demand. We are also hopeful that the example of the Arts Impact Fund will inspire others to replicate the model to benefit different sectors and geographies.”

Ends

For media enquiries and interview requests please contact Anna Zabow in Nesta’s press office on 020 7438 2697 or [email protected]

Notes to Editors

1. The Arts Impact Fund is a £7 million fund, convened with the help of the Cabinet Office, to demonstrate the significant social value created by arts organisations and support their work through loan finance. The initiative uses a three-way funding model – called comingling. It was developed after Cabinet Office research suggested there is an investment demand of £28 million from arts-based organisations.
2. Social/impact investment means the provision of repayable finance for a social and financial return. The Arts Impact Fund has provided repayable finance in the form of unsecured loans of between £150,000-£600,000, repayable over three to five years. It does not provide grant funding.
3. The investable portion of this was £6.7 million. To date, the Fund has legally completed on £7.5 million of loans as a result of recycled undrawn facilities or early repayment of some loans, thereby making funds available to reinvest. A total of £9.1 million of impact investments were approved over the three years of the Fund but not all of those investments were legally completed.
4. In March 2018, innovation foundation Nesta commissioned MTM, a research and strategy consultancy, to run the survey. 1,068 survey responses were used to model the potential future demand for repayable finance across the sector, which is estimated at just under 3,000 active arts and cultural organisations above a threshold level of identifiable income. The press release distributed on 23 March 2018 can be viewed here: UK arts and cultural organisations set to seek more than double in repayable finance over the next year than during 2016
5. Interviews and investee case studies are available on request.
6. Investees from previous rounds of Arts Impact Fund investments include:

• Birmingham Royal Ballet - £215,000 was used to adapt its iconic production of The Nutcracker for future arena and other large-scale venue tours, diversifying income streams for the ballet company.
• Fuse Art Space - £150,000 funded a grassroots arts and performance venue in Bradford to launch pioneering residential arts training programme taught by world-class creative practitioners.
• MeWe360 - £150,000 helped to create a new workspace and mentoring development hub for Black, Asian, and minority ethnic creative entrepreneurs in Soho.
• Soho Theatre - £300,000 enabled the organisation to produce a pilot series of digital comedy content and license it to broadcasters, digital platforms and distributors, which has created new opportunities for artists to reach new audiences.
• Studio Wayne McGregor - £500,000 was used to complete the construction of a new studio space for the multi-award-winning choreographer and his dance company; making it the first cultural organisation in the Olympic Park.
• V22 London - £300,000 was used to acquire a listed heritage building in Orpington and create new affordable artist studios; refurbishing it for the benefit of creatives and local community.
• Village Underground - £600,000 enabled an iconic London music venue to acquire new, larger multi-arts venue in Hackney and partner with an arts charity, Community Music, to deliver social programmes.
• Walk the Plank - £170,000 enabled the leading UK outdoor arts organisation to create, and relocate to, a new, award-winning outdoor arts hub in Salford; contributing to regeneration of the local area and strengthening its cultural infrastructure.

About the Arts Impact Fund

The £7 million Arts Impact Fund is a collaboration that brings together private, public and philanthropic investment and provides unsecured loan finance to arts and cultural organisations in England that can demonstrate positive social impact. The contributors to the Fund all share a commitment to supporting the arts and culture and include: Bank of America Merrill Lynch, Esmée Fairbairn Foundation and Nesta, and Arts Council England with additional funding from the Calouste Gulbenkian Foundation (UK Branch).