Diversified Impact FundINVESTOR UPDATE | APRIL 2023 Dear Investor, We are delighted to announce that the Diversified Impact Fund (DIF) has committed $750,000 to Project Independence (PI). PI is a social housing model for people with mild intellectual disabilities that supports social and financial independence within a safe and caring community. More information on this investment is shared below. We have been pleased to see multiple DIF investments receive positive public coverage over the past few months as detailed further below; a testament to their performance and innovation in driving social impact. With the execution of PI legal documentation, the DIF’s active Investment Period has concluded. In February, a $2.5m distribution (or 16.7 cents per unit) was made to investors predominantly from the returns of the Nightingale Village repayment and Aspire Social Impact Bond (SIB) (a performance coupon and unit redemption payments). Over its life, and including PI, DIF will have made 12 investments, diversified across 4 instruments, 5 sectors and 6 target demographics. Eight SDGs are advanced by DIF investments. We want to share with you some changes within the Impact Investing team. Rebecca Thomas returned from parental leave in early February to her role as Impact Investing Executive Director. We thank Matthew Deeble for his contributions to the DIF as Acting Impact Investing Executive Director. Additionally, after three years with SVA Impact Investing, Tim Pullen left at the end of January to take a research role with the Centre for Social Impact at Swinburne University. We thank Tim for all his contributions to the DIF and wish him all the best. With the DIF making its final investment and finishing its Investment Period, we have been reflecting on the impact and achievements of the fund and its place in the rapidly evolving Australian impact investing market. We invite your thoughts and reflections on the DIF and the Australian impact investing market as a DIF investor. We thank you for your ongoing support as we continue our focus on driving social and financial outcomes throughout the term of the DIF. Kind regards, Rebecca Thomas Rebecca Parkinson Key investor information End of investment period Investor Distribution New investment announcement: Project Independence We are delighted to announce a $750,000 senior debt commitment to Project Independence (PI), a not-for-profit focused on improving the financial and social independence of people with a mild intellectual disability through its social housing development in Phillip, ACT. The DIF’s investment will be used for the construction of PI’s third development which will provide homes for ten individuals and a live in residential coordinator. SVA and PI have been engaging for many years, with SVA providing support and guidance to PI. We are excited to see this project come to fruition and provide homes for ten individuals. According to the ACT Council of Social Service (ACTCOSS), there is a significant shortage of social housing in Canberra and individuals with mild intellectual disabilities can be placed in entirely unsuitable accommodation (i.e. nursing homes). Through this investment, the DIF has been able to support the scaling of a community focused model that supports residents to live as independently as possible whilst acquiring equity in a property. We greatly appreciate the pro-bono legal services very generously provided by law firm Ashurst on this transaction. Architectural render of PI Phillip which will provide homes for ten very excited new residents. Stellar performance from the Aspire Social Impact Bond In January 2023, the DIF received coupon and redemption payments in relation to its investment in the Aspire SIB. As anticipated, 89% of units were redeemed with payment of $444,400 received alongside a performance coupon of $365,974. The coupon was higher than expected with Aspire meeting actual reduction outcome targets in line with the ‘outperform scenario’ across hospital bed days, convictions, and accommodation periods for the 575 participants. The bulk of these funds were distributed to DIF investors in the February 2023 distribution. Aspire Team Aspire provides assistance in securing stable accommodation. DIF Investments – in the spotlight Over the last few months, multiple DIF investments have been profiled in the public which is a testament to their commitment and success in delivering social outcomes. Aspire Social Impact Bond
Hayylo
Maths Pathway
Nightingale Village and Synergis Fund
Resolve Social Benefit Bond & Newpin SA Social Impact Bond
Reflecting on the DIF As the DIF has now concluded its investment period, SVA is turning its mind to the learnings and insights to inform new opportunities for social investment in Australia. As a DIF investor, we would be interested in including your insights and observations in this process. Please email us or reach out – we’d love to arrange a call. The DIF was designed to target market returns in a nascent and small social impact investing market. Our experience over the past 5 years has highlighted:
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