INDIGO

This animation displays the growth in the number of projects and actors in the Impact Bond network since 2010. Blue nodes are impact bond projects. Pink nodes are commissioning organisations, green nodes are investors, yellow nodes are service providers and light-blue nodes are intermediary organisations. 

The story of the impact bond network started in 2010. The Peterborough Impact Bond project was the first of its kind. Aimed at reducing reoffending rates, the project was designed by Social Finance UK and commissioned by the Ministry of Justice.

In 2011, the Ministry of Housing, Communities and Local Government together with the London Greater Authority decided to design a second project: the London Homelessness Social Impact Bond. Triodos Bank, a sustainable banking firm, acted as an intermediary organisation and St. Mungo’s, a charity, was the main service provider.

The network grew significantly in 2012. The Department for Work and Pensions launched the Innovation Fund. This fund paid for the outcomes of 10 impact bonds projects, including the Advance Programme, Energise, and Teens and Toddlers. This is also the year that the UK network becomes a multipolar group of projects and organisations. Some organisations started to play a leading role, such as Big Society Capital, who were already working with four different projects, or Social Finance UK, who were working with three.

2012 also witnessed the beginning of interest in impact bonds in the international arena. New Zealand launched the Auckland New Correction Facilities project and United States started the Adolescent Behavioural Learning Experience project.  International interest kept growing in 2013: new impact bonds appeared in the Netherlands, Germany and Australia. The United States experimented with more projects, such as the Utah High Quality Preschool Programme.

Years 2014 and 2015 show how impact bond networks started to consolidate in different countries. The UK network becomes a mature group of organisations, where service providers and social investors have developed an expertise after working in several projects and governments have improved their mechanism of paying for outcomes by designing and working with different outcome funds, such as the Youth Engagement Fund or the Fair Chance Fund. The United States network started to consolidate and some organisations played a key role, such as the Goldman Sachs Social Impact Fund or the US Department of Labor. New countries launched impact bond projects, including India and Finland. 2015 is also the year of the first international impact bonds: the Educate Girls in India and Ashaninka project in Peru.

In 2016 and 2017 the network becomes more interconnected. The networks of different countries, that used to be separated, also becomes interconnected. Organisations like the QBE Insurance Group are involved in projects from both the UK and US. KOIS, an impact finance firm, is involved in projects from Belgium and several African countries. UBS Optimus Foundation has projects in India and Israel. Deloitte works as evaluator in projects from the Netherlands, France and Portugal. This is the beginning of a worldwide network where the UK government and organisations play a leading role, but other organisations are a key part too, as they expand the model to other countries thus experimenting with different contexts and new challenges.

The network keeps growing in 2018 and 2019 and the SIB model spreads further around the world. Latin America develops several projects, such as the ‘Proyecta tu futuro’ SIB in Buenos Aires and ‘Cali progresa con empleo’ in Colombia. These projects have links to organisations such as Social Finance UK or the Interamerican Development Bank, which makes the network even more interconnected across countries. The Cambodia Rural Sanitation project starts in 2019 and holds links with Social Finance UK and USAID Agency. Finance for Jobs in Palestine is a joint project between Social Finance UK, the World Bank and the European Bank for Reconstruction and Development. The international network becomes so interrelated that it is difficult to find the centre of the network after 2019.

Between 2020 and 2021, only 20 impact bond projects started to deliver services. Of those 20 projects, 12 are Life Chances Fund projects. The COVID-19 pandemic may have had an impact in the growth and development of this network. It is possible that these organisations had to focus on adjusting their services and adapting to social distancing measures.

If you are interested in a particular impact bond, you can access our Impact Bond Dataset and get more information about the project and the organisations that were involved. If you are interested in the outcome funds, INDIGO offers an Outcome Fund Directory with standardized variables and a list of associated projects. Finally, the GO Lab Knowledge Bank has a large collection of case studies with insights from researchers and practitioners working in the field.