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venture fund delivers a social return

October 2007

A venture capital company formed to support social projects has raised £75million ($150m) for its second community development venture fund.

UK-based Bridges Ventures had hoped to reach £50m, but easily exceeded that target, raising more than three times more private sector money than for its first fund in 2002, whose portfolio received matched investment from the UK government. The new fund is entirely private money.

Philip Newborough, Bridges’ chief executive, said the response showed ‘growing interest in investments that can deliver attractive financial returns while making a positive social impact’.

The private equity firms Doughty Hanson and 3i are among the backers, together with Barclays, Citigroup, Co-operative Financial Services, HSBC, Lloyds TSB and the West Midlands Pension Fund.

Most of the businesses in the two funds’ portfolios are in deprived inner city areas and have interests ranging from property to services and manufacturing. They include The Office, which renovates freehold buildings and Chill Factor, north-west England’s first indoor real snow Alpine village, in which Bridges Ventures invested £3m in 2006.

Several of the 24 investments made have since been realized. SimplySwitch, a price comparison company, was acquired by The Daily Mail & General Trust in 2006 for £22m, representing an internal rate of return of 165 per cent. Bridges achieved a return of 84 per cent when it sold the Hull-based specialist printer Harlands in 2005 for £8.5m.

The investments made by its first fund now give work to more than 800 people, nearly 200 of whom were formerly unemployed, according to Bridges.



Further Information
http://www.bridgesventures.com
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