Ten Reflections on the Social Finance Fund

7 min readJun 2, 2023


It’s real. And it’s finally here. This week, the long awaited, highly anticipated Social Finance Fund was officially announced at Impact Hub Ottawa. This federal government has placed the capital from the Fund into the hands of three wholesaler organizations who will invest in organizations and funds that drive positive social impact.

Given a total amount of $755 million, it is the biggest single investment of social finance capital in Canada. Indeed, institutions like Vancity, Desjardins, Fondaction and CDPQ have more total capital. But their assets grew over a long period of time, and they also have a wider sector focus including climate action.

This systems level achievement was the painstaking and patient work of many hands over three separate decades. Yes, this idea has a very long history. One of the earlier iterations of a similar concept was a $100 million commitment by the federal government in 2004 that resulted in a $22.8 million investment in La Fiducie du Chantier de l’économie sociale in 2007.

Hundreds of leaders made this happen from the foundational work of folks including (but absolutely not limited to) Tim Draimin, Tim Brodhead, Stephen Huddart, Bill Young, Robin Cory, Karim Harji, Jo Reynolds, Adam Jagelewski, Allyson Hewitt, Ilse Treurnicht, and the members of Task Force on Social Finance. It is also the result of the work over the past five (5) years of political leaders like Senator Ratna Omidvar, MP Ryan Turnbull, Minister Karina Gould, a dedicated group of ESDC public servants, dozens and dozens of stakeholders across sectors, and the lead wholesalers. It proves again that great people and great partners drive social innovation.

So why does this announcement matter and what’s important on the road ahead?

1. First time fund managers will get capital

This is a big deal. It is incredibly challenging for a first-time fund manager to raise capital. Many (if not most) investors (particularly institutions) will simply not invest in first-time managers due to actual and perceived risks. At the same time, if we are going to tackle the challenges we face, we will need more intermediaries to place capital into underserved communities, equity deserving groups, and regions that lack capital. By eliminating this barrier, the potential for new intermediaries to start and scale will be significantly increased.

2. This could set the table for common measurement approaches across the system

The Social Finance Fund has the potential to touch many (if not most) of the leading active and emergent impact investing funds in Canada. There will undoubtedly be common reporting requirements alongside helpful tools and approaches to impact management for intermediaries that are capitalized. This may be the most significant legacy of the Fund: an impact investing system with a more harmonized, commonly applied and coherent system of impact management and reporting.

3. It will be monumental effort to place all the investment capital

It won’t be like Brewster’s Millions. But it will be challenging to invest $755 million within the established time frame given the mission and criteria of the Fund. Given the state of the ecosystem, there is a significant amount of money that will be able to go out the door in the early days of the Fund. It will then require a great effort to identify and support the development of intermediaries and funds to place the remaining capital over time.

4. There will need to be a multi-stakeholder commitment to help start, support, and scale-up emerging and existing intermediaries

There will need to be an effective set of capacity building programs, funding to start and operate intermediaries, and other resources to support intermediary infrastructure. And the federal government won’t be able to resource this effort alone. There will need to be contributions from foundation, government, and corporate partners to fund this effort. Fortunately, there is a clear incentive for partners to co-resource this work as this kind of support will be able to unlock investment capital that can drive positive social impact.

5. We need to continue to fund the investment readiness of individual organizations and enterprises

It is highly unlikely that wholesalers will invest much capital directly in social purpose organizations (SPOs). Capital will primarily flow from the wholesaler to intermediaries (eg. A place-based fund in BC) and then on to SPOs. Accordingly, the funds that receive investment from Social Finance Fund wholesalers will need to have access to a pipeline of investment ready enterprises, organizations, and projects. There are many excellent accelerators, incubators and business support programs across the country. But we will need to ensure they are properly resourced, and we will have to re-new and re-imagine the Investment Readiness Program so that it is more tightly and tactically connected to the Fund.

6. We will need to sustain this effort with other policy interventions

The commitment is historic. But a one-time injection of funds is only a necessary but not sufficient condition for sustainability. Mature mainstream and impact investment ecosystems feature other policy interventions including renewable funds (eg. CDFI Funds and supports at a federal and state level in the United States) as well as tax incentives or tax credits.

7. There is a tremendous need and opportunity to leverage this investment

A part of the design of the Social Finance Fund is a mandate to leverage capital from external investors. This represents a remarkable opportunity at a Fund, wholesaler and individual fund level. Our federal government leaders can leverage their political capital with mainstream financial leaders at pension funds and financial institutions to present the opportunity for co-investment. At a wholesaler and individual fund level, there is an opportunity to engage active and interested investors who are interested or actively involved in impact investing including individuals, families, foundations, faith-based organizations and mission-aligned institutions. We will need to be strategic given the limited resources on hand. On tactics, let’s not bet the farm on convincing benevolent, traditional venture capitalists or financial institutions to change decades of practice. Surely, we can make some inroads, but the bulk of our efforts are better placed on already mission-aligned investors.

8. Provincial governments have an opportunity to create the conditions to attract and leverage this capital

Millions are sitting on the table for folks from Premier Ford to Premier Pillai and beyond. Specifically, there is $755 million on the table to support the social and economic interests of provinces and territories across the country, from driving inclusive employment to tackling pressing social challenges. Using the right tools at their disposal, provincial governments have an opportunity to attract and leverage this capital with the right policy interventions. This may include matched investment capital, funding or capacity-building support for intermediaries, strategic policy plans, or assistance in coordinating stakeholders to be ready for the capital that the Fund will provide.

9. This is an opportunity for learning and engagement across the federal government

There are numerous impact investing interventions and intersections across the federal government including ESDC, GAC, CMHC and ISED. This provides an excellent opportunity for peer learning, sharing insights and lessons learned, and collaboration. There is also a great opportunity for collaboration and learning across jurisdictions into other regions where there are policy leaders engaged in impact investing, including the US, Mexico, and Colombia.

10. Equity needs to be at the centre of the Social Finance Fund. But it’s going to take a lot of work.

The announcement was great. It’s huge news and there are so many positive things to say about the people in government and in the sector that have moved this forward over so many years. But something that was missed that is a symbol of a larger systemic issue around equity. Heck, I missed it at first, and it was staring right at me. Many other folks noticed it.

Here’s the deal: from start to finish, leaders on stage did not fully represent the true diversity of Canada. Beyond their words and titles, it is the very picture of people speaking at events that tells a story. It tells us who is in power, who is important, who can we aspire to be, and more.

As an individual, I don’t always get it right. And as an organization, we don’t always get it right. We organize panels and events, and there have certainly been times where we have fallen short. Yes, it can be hard. But if a key purpose of our work is to advance justice, equity, diversity and inclusion, it must be embedded in everything we do.

I’m not calling individuals or individual organizations out. I have a great deal of respect for the individuals and organizations who spoke at the launch. It’s a systemic problem. Let’s use this as an opportunity to call us all in to provide space to listen to a wide range of diverse voices that can help achieve the aims of the Fund. And let’s use this opportunity to identify and take specific and demonstrable actions that advance equality and equity in the operations and outcomes of the Fund and the sector. On a practical basis, there are so many things we can do in terms of planning, data tracking, and criteria. For example, we should expect that there is an equity and gender lens for all investments made via the Fund.

So that’s it. Just ten things.

If you want to learn more about the Social Finance Fund and to engage in the conversation on this important topic, please join us at the Social Finance Forum on June 15–16. There will be a townhall featuring the wholesalers providing an opportunity for questions and discussion.

We hope to see you there!

Full disclosure: SVX has received support from the Government of Canada (via the Investment Readiness Program) as one of the partners in an ecosystem effort related to place-based impact investing via the Catalyst: Community Finance Initiative. We also work with Global Affairs Canada (GAC) on impact investing efforts in Latin America.




SVX is a financial services firm & impact investing platform connecting ventures, funds, and investors to catalyze investment capital for impact. #ImpInv#SocEnt