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Transaction costs to support social finance intermediaries

Call Call for proposals

In line with the Social Economy Action Plan (SEAP), this call for proposals is financed under the Employment and Social Innovation ("EaSI") strand of the ESF+ .

The objective is to support the development of the social investment market and to facilitate access to finance for social enterprises. It will catalyse risk capital investments below EUR 500 000 (over a period of 18 months) that otherwise would not happen in the area of social finance, by supporting transaction costs linked to these investments.

This transaction cost support scheme takes the form of a grant and can be combined with financial instruments as a means to address the mismatch of needed and sustainable ticket sizes.

This grant is aimed at financial intermediaries undertaking long-term risk capital investments in ticket sizes of less than € 500 000 in the form of equity, quasi-equity or hybrid financing. The grant will help to lower the transaction costs for these small investment tickets and will help overcome a market failure in the social enterprise finance market.

The activities that can be funded under this grant include the preparation, conclusion and follow-up of long-term risk capital investments into social enterprises such as:

  • Travelling to meet (potential) investees;
  • Screening and processing investment applications;
  • Preparing legal documents, potentially with a lawyers' advice;
  • Carrying out the due diligence, including assessing (potential) impact of the investment;
  • Providing investment readiness, scaling readiness or business restructuring support;
  • Bringing in co-investors;
  • Managing the investments and monitoring social impact.

 

See also