1. Financing Community Organisations
Ben Gales, August 2013
INNOVATIVE PARTNERSHIPS

2. FINANCING COMMUNITY ORGANISATIONS
• Background on SEFA
• How we can help you achieve your social mission
• Lending responsibly - the 5 C’s of Financing Community
Organisations
• Case study - Myrtle Park

3. SEFA BACKGROUND
• SEFA is a social enterprise that lends to other social enterprises
with a focus on community, indigenous and environment
• We seek to be an important contributor to the long-term
development of the social enterprise market in Australia
• SEFA is one of the Australian Government’s Social Enterprise
Development and Investment Funds (SEDIF)
• Investors:
• NSW ALC, Triodos, Community Sector Bank, foundation, individuals
• Seeking financial and social returns.

4. PORTFOLIO
• SEFA has made loans to community projects in regional
Australia:
– Crisis accommodation in Cairns;
– Low income retirement housing in NW Tasmania; and
– A community school in Kuranda in Queensland.

5. HOW SEFA HELPS YOU ACHIEVE YOUR MISSION
Social Impact
Time
Constrained growth
Unconstrained growth
• We provide loans to community organisations to enable them to better achieve
their social mission

6. The 5 C’s of Financing Community Organisations
Community
Organisation
Responsible lending - an “appropriate” risk
for the community organisation and SEFA

7. Character
Community
Organisation
Character
• You – the people who run
the community organisation
• How well is your
organisation run?
• Do you have the right
financial reporting and
governance in place?
• Do you have local
community support?

8. Capacity
Community
Organisation
Capacity
• How strong is your business
model?
• Will the cashflow you
generate enable you to
(comfortably) repay the
debt?
• Is your income diversified?

9. Conditions
Community
Organisation
Conditions
• What is the state of the
market you are operating in
and how well are you
positioned?
• Is there high demand / need
for your product / service?
• What is the social impact
that our loan will help you
achieve?

10. Capital
Community
Organisation
Capital
• What is the “capital” in your
community organisation?
How resilient is your
organisation?
• This can be financial – cash –
but we also look at the
strength of non-cash /
community assets.
• Having sufficient capital
means that you can weather
any unexpected setbacks.

11. Collateral
Community
Organisation
Collateral
• SEFA lends responsibly to
ensure your and our
sustainability
• Security is an important
factor in risk assessment
• Having a loan backed by
security reduces the lenders
risk
• This reduces the interest
charged to you

12. Case Study – Myrtle Park
• Myrtle Park Retirement Centre is based at Yolla in NW Tasmania.
A community organisation that provides low income retirement
accommodation.
• SEFA is funding four new two-bedroom units. Prefabricated
housing units that have a high environmental rating.
• Each unit costs about $120k ($40k of foundations) and rents are
about 1/3rd aged pension.
• Bank loans were not available. Security is existing units and land.
Organisation has been in existence for 22 years.
• A remote community that is keen to provide low income housing
for retired people from district.

13. Case Study – Myrtle Park
Myrtle Park
Character: Significant
local community support –
volunteer members – with
the build managed by
Tasbuilt Homes – Strong
and resilient team
Capacity: Rental
income and minimal
expenses due to
community volunteers –
strong cashflow to
service debt
Conditions: Myrtle Park provide affordable
retirement accommodation in Yolla, a
disadvantaged area in North-west Tasmania –
high demand
Capital: limited cash
reserves but minimal
expenses and strong
community support –
highly resilient
Collateral: land and
buildings owned by
Myrtle Park – Good
security

14. CASESTUDY
Myrtle Park / SEFA = WIN/WIN Result

15. CONTACTUS
• Social Enterprise Finance Australia
– Ben Gales - 02 8199 3362 / 0449 258 971
– Ben.gales@sefa.com.au
• Website - www.sefa.com.au