Challenges and opportunities in social impact finance

Social investment

In the social investment ecosystem, guaranteeing the financial sustainability of projects represents a constant challenge. Organizations that operate in the so-called third sector not only face the mission of transforming lives and generating positive impact, but we must also seek mechanisms to ensure the continuity of initiatives. Today we reflect…

Date

3 February, 2025
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In the social investment ecosystem, guaranteeing the financial sustainability of projects represents a constant challenge. Organizations that operate in the so-called third sector not only face the mission of transforming lives and generating positive impact, but we must also seek mechanisms to ensure the continuity of initiatives. Today we reflect on strategies that can strengthen financial autonomy; however, this should not be at the expense of our purpose. While it is essential to seek resources, we must remember that the ultimate goal must be social impact.

Diversification of funding sources

One of the lessons that all of us in the third sector should learn is that depending on a single source of income makes us vulnerable and that only through diversification of income can we achieve the financial viability of our projects. Achieving this is not an easy task, but if we integrate some strategies, we begin to pave the way. 

  • Strengthening local fundraising through donation campaigns aimed at citizens, companies and philanthropists, which allows us to connect with the community, thus generating a sense of co-responsibility. In addition, promoting recurring micro-donations through digital platforms also facilitates the continued support of those who believe in our causes.
  • Partnerships with the private sector also play an important role. Linking up with Corporate Social Responsibility (CSR) programs or establishing strategic partnerships with companies that share our values not only provides us with resources, but also generates powerful synergies to maximize impact. Offering tax or visibility benefits to corporate donors can incentivize active participation in social development because it is crucial for the well-being of the community.
  • Income generation is essential and that is why we talk about social entrepreneurship as a viable alternative, either through productive units that are aligned with the social mission or by offering specialized services such as training and consulting. 
  • Innovation, technology and mixed models to expand outreach and create awareness campaigns that mobilize citizens. The use of digital tools and crowdfunding platforms such as Vaki or Kickstarter have proven to be strategic allies to finance specific projects.
  • The creation of endowments that allow saving a percentage of current income and generate future returns as a strategy for long-term financial stability.

By combining mixed revenue models, organizations can achieve a balance between financial autonomy and sustainability. 

Building trust and demonstrating tangible impact 

Beyond resources, the real driver of sustainable growth is trust. Establishing strong relationships with the community, demonstrating tangible impact and ensuring transparency in the management of resources are key factors in attracting strategic allies and consolidating the necessary support. 

At ONE, we continue to seek new ways to strengthen our projects, convinced that the balance between sustainability and social mission is fundamental. The question remains open: how can we continue to innovate in financing models to ensure sustainable impact?

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