Social Investment Simulator

A board-level modeling tool comparing standard grant decay curves against recyclable capital structures.

Interactive Model

Simulation Parameters

Quick Presets

High Loss Recycling

A typical first social-investment book: 30% of the pool is invested, 80% of deals are written off, and winners still return 2.5x. Cheap origination (5% friction) matches that high loss rate. Recycling still happens — just from a thin surviving slice of the portfolio.

Initial Capital Pool £1,000,000

How much we start with.

Time Horizon 10 Years

How many years we want to watch this simulation run.

Annual Base Grant Spending £100,000

How much we give as grants.

Social Investment (SI) Allocation 30%

How much of our pool we put into businesses instead of giving away.

Investment Strategy Profile How and when these businesses pay us back.

Default / Write-Off Rate 80%

Share of invested businesses that fail and return nothing. Cutting this by 10 percentage points costs about 30% more in sourcing and deal friction (due diligence, structuring, origination).

Outperformance MOIC (Multiple on Invested Capital) on Winners 2.5x

How much extra money successful businesses pay us back (e.g., 2.5x doubles our money and then some).

Sourcing & Deal Friction Cost 5%

Share of the SI allocation spent to find, check, and structure deals. Spending more here is what buys a lower default / write-off rate.

Social Investment Impact Factor (SROI / Social Return on Investment Multiplier) 1.5x

How much good a business does compared to a regular gift (e.g., 1.5x means it does 1.5x more good because the business keeps running). Treated as an illustrative factor, not an audited result.

Treasury / cash return (Track C) 3%

Interest assumed if the whole pool stays in cash and only pays grants. Default 3%.

Ongoing origination / stewardship £0

Optional staff / DD cost taken from the hybrid pool each year, on top of the one-off sourcing % at deployment.

Reinvest repayments into new deals. After each year’s grants, leftover recycled cash above one year of committee funding is originated again (friction and write-offs apply to each vintage). That is what lets an evergreen pool keep turning over without skipping the grants round. Stress-test write-offs without extra DD spend. Unlocks Default and Sourcing so you can raise losses without paying more to originate — a naive book, not the linked rule.

Lifespan Extension (Runway)

+2 Years

Active Runway

Deployment Power (Total Deployed)

1.15x

Total Deployed Capital

Total Recycled Capital

£142,500

Returned to Pool

Portfolio MOIC (Multiple on Invested Capital)

0.48x

47.5% recovery rate

Illustrative SROI

1.28x

vs 1.00x in Control

Capital Pool Decay Curve

Year-by-year ending pool balance. Markers show the first year each track can no longer pay the full grants committee.

Annual Recycling & Grants

Breakdown of grants paid: original capital vs recycled returns.

Portfolio Cash Flow profile

Friction, write-offs, realizations, and net recycling.

Write-off sensitivity

Other sliders held as they are now. Sourcing cost follows the rule: each 10 percentage-point drop in default costs about 30% more origination from the 5% baseline.

Write-offs	Sourcing	Recycled	Committee runway	vs pure grants	Illustrative SROI

Assumptions in this pack

Board Discussion Points

1. The Sourcing Friction

Sifting deals, structuring loans, and due diligence is not free. Lower write-offs are modelled as more origination spend: each 10 percentage-point drop in default raises sourcing / deal friction by about 30% from the 5% baseline.

2. Acceptance of High Write-offs

A cheap, light-touch book can still recycle capital if winners return multiples — but the default rate stays high. Paying for better sourcing is the lever that brings write-offs down.

3. The Double Bottom Line (Social Return on Investment - SROI)

Invested capital drives active social enterprise business operations while it is deployed, achieving a higher combined Social Return on Investment (SROI) than pure grants.