Catalyst Fund

A new fund designed to finance ambitious social enterprises in Scotland has been launched.

Delivered by Firstport and Social Enterprise Scotland, the Catalyst Fund offers loans starting at £50,000 using a revenue-based repayment model.

This model provides flexibility to businesses in the early stages of development and fills a gap in the existing social investment framework.

The Scottish Government has invested £15m into the fund and hopes it will complement existing social enterprise support and funding infrastructure.

Revenue-based financing is growing in popularity as an alternative to more traditional mechanisms to help companies grow.

The Catalyst Fund is the first to use this model to finance social enterprises in Scotland.

Repayments are based upon a percentage of the trading income earned by the enterprise and there is no specific length of term – revenue-based repayments continue until an agreed amount is repaid.

This form of repayment means the Catalyst Fund is aligned with the growth of the enterprise, meaning it can prioritise growth and impact.

Daisy Ford-Downes, Head of Group Investment Programmes at Firstport, said: “The Catalyst Fund could really transform the way we build social enterprises in Scotland.

“At Firstport and Social Enterprise Scotland, we have been listening to social entrepreneurs and reviewing the data, and we know that there is a gap in social investment for early-stage social enterprises.

“It is a missing stepping-stone in the path, and it is preventing too many from reaching their full potential. 

"We’re so excited to launch this fund and to start helping social enterprises to build successful, sustainable organisations.”

Chris Martin, Chief Executive of Social Enterprise Scotland, said: "Scotland has an excellent track record of social investment and I am delighted to see the Catalyst Fund launch as a complementary financing option for social enterprises who can’t currently access mainstream social investment.”

Key takeaways:

  • Revenue-based financing is a new social investment product whereby repayments are based on a percentage of trading income
  • The Catalyst Fund is available to social enterprises in Scotland
  • For more information on funding available to small and medium-sized Scottish businesses, head over to UMi Debt Finance:
Richard Dawson
Article by Richard Dawson
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