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Interview: CEO Ben Gales reflects on 2015

Over the past 12 months SEFA has continued to mature as a social finance organisation, and has witnessed real benefits flowing into both the deal side of the business as well as the capital raising side. The organisation has reached a level of maturity and its’ profile in the market is growing. CEO Ben Gales talks about the year’s highlights and expectations for 2016.

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Are there any highlights that stand out to you personally?

We’ve had a very productive year with many new initiatives and milestones.  Our lending activities have increased, and we’ve established a few new partnerships and we’re providing innovative financing solutions that better support our clients. As an organisation we’ve also evolved as we respond to new opportunities, and are frequently invited to speak at events. We’ve partnered with the Lord Mayors Charitable Foundation to launch an affordable housing fund in Victoria. And we’ve developed a new initiative SEFA Crowdmatch in partnership with StartSomeGood, a crowdfunding platform, to assist early stage start-ups. We’ve also been certified as a B Corp and enjoy being part of the community that has social responsibility and transparency as its’ core values.

You say lending activities have increased, can you tell more?

SEFA has doubled its’ loan book every twelve months since inception. In 2015 we disbursed $4.2 million in loans to nine community organisations, bringing our total cumulative disbursements to $7.8 million.

What kind of clients and projects are you financing?

Over the past twelve months we have supported disability service organisations, a community organisation to acquire a local bakery, a well-being centre, and a start-up café and plant nursery.

Have there been any disappointments this year?

The portfolio has now had several deals go through the whole lifecycle, from disbursement to repayment, but disappointingly we had a client going into administration in 2015.  We learned a lot from this experience, and, although it was a difficult process for all, we fully recovered our capital.

An important aspect of SEFA’s mission is creating social impact. What impact has SEFA made this year?

Our biggest impact is indirect and comes very much through the clients we loan to. Our clients continue to have significant positive impact in their local communities nationwide. For example, providing crisis accommodation, employment and training opportunities for long-term unemployed indigenous people, affordable retirement homes, and supported accommodation for people with disabilities.   We are proud to be able to support them so they are better able to achieve their mission. We also make an impact by raising awareness of social impact finance and have run a number of capacity building workshops that were well attended, so we’re getting the word out there.

What do you expect from 2016?

We enter 2016 in a strong position, with further committed funds (but not yet drawn) of $4.7 million and a very strong pipeline of opportunities. We continue to welcome new investors, which is hugely appreciated, as is the continued support of our existing investors.  Since July 2014 we’ve raised an additional $2.1million of capital. The fundraising program continues into 2016 as we continue to grow our loan book. We have a healthy pipeline and there is great momentum in the business.

What challenges do you foresee for the year ahead?

The challenge for SEFA looking ahead continues to be getting to scale.  The $20 million fund is just the start.  We will need to raise a further $20 million plus in the coming years, and we’re actively negotiating wholesale facilities to enable us to achieve this goal in a capital efficient way.  But I expect when we achieve it, we will grow more efficiently and be well-positioned in 2016 and the years ahead.

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