Cancer Research UK: the “art of the possible”
How Collington Capital introduced us to the possibilities of pioneering sustainable finance models in the charity sector. By Tony Hickson, Chief Business Officer, Cancer Research Horizons.
Over time, Cancer Research UK has developed a deep understanding of the power of philanthropy and mass donations. We also have an innovation arm – Cancer Research Horizons – which aims to ensure the ideas coming out of Cancer Research UK turns into products that benefit patients. As such, we understand the commercial world of investment.
However, we have come to realise that there is a white space between the two: impact investing. The problem is that without understanding this area, it is hard to get involved because you don’t know where to start, which is where Collington Capital came in.
We discussed the various options with the team at Collington Capital. Because we weren’t sure which impact investment models could work for us, or if they would work for us, we started a pilot to explore what the different blended finance options could look like including reviewing the potential of grant linked impact funds and grant linked impact bonds.
The work culminated in material for our Board which outlined at a high level three potential blended finance impact investment structures. The team’s insights and expertise were invaluable to us at this discovery phase and it opened our eyes to the art of the possible.
We soon realised that it would require an awful lot of work for a charity to go about setting up a sustainable funding model. We want to get it right first time and so we are now taking steps to develop our understanding further. After this initial process with Collington Capital we have embarked on setting up a think tank to devote more time and resources to a potential sustainable finance vehicle and we have invited Collington Capital to be part of this process.
Colleagues are now assembling a range of people from different backgrounds including private equity, philanthropy, not-for-profits and more. The group needs to get input from people who are familiar with this type of work but also those that operate in the same sectors as us. The work we did with Collington Capital has sparked this type of thinking and we are excited to see the outcome of this process.
On a personal level, we found Collington Capital to be extremely professional and knowledgeable, given their extensive background in banking and finance. They worked quickly using a talented team of analysts. One of the primary benefits of working with Collington Capital was their excellent communication. There was constant dialogue to let us know what they were doing, which we believe is very important when working with a third party.
Collington Capital took us through questions like: what would the key assumptions underlying the modelling need to be? What would the investment proposition itself look like? What organisational capabilities would we need afterwards?