It gets back a bit to what I was saying. An organization like that wants to be able to scale up its proven intervention but doesn't have the resources to do so. What we know from talking to charities and not-for-profits is that they don't have access to traditional forms of capital through going to a bank. It is not available because their social enterprise business model is not one that the traditional banking community necessarily understands, and so they are left with very few options. Grants are the usual ones.
Social finance provides an alternative form of funding. As I mentioned earlier, that funding can come from a private foundation. Some of the foundations that are engaged in looking at this in Canada are considering whether there are possibilities for them to make a loan, for instance, to that kind of organization. That is one form of social finance.
Another form that you mentioned is the social impact bond, which has an investment component. An organization—it could be a private foundation, or some financial institution such as RBC or TD that is more actively engaged in this space—would make an investment in that proven intervention, and they would get their money back from the market, if that intervention achieved predetermined outcomes.
What is important in any case and in the one you mentioned is that all the partners decide on what outcome is to be achieved. That changes things in the conversation, because currently we don't focus on outcomes all that much. We tend to focus on outputs or activities and don't often ask the question whether our programs are achieving certain outcomes. These could be, for instance, reducing high school drop-out rates, or they could be increasing literacy and essential skill levels, things that we know are going to help Canadians stay in the labour market or achieve a certain level of well-being.
Once those outcomes are decided, they become the target. Then, in the case of the social impact bond, which has a supply of capital and an intermediary managing the project, if the outcome is achieved by the service provider, the investor would get their capital back plus a certain risk premium.