Behind Our

Due Diligence

 

For the 2019-2020 grant cycle, our Due Diligence team consisted of seven people, five from the leadership team, and two new Founding Members who have volunteered their skills. Together, we have substantial experience in social investments, charitable governance and financial analysis.  

Several months ago, we started with the list of charities registered with the Charities Commission that are based and operate in London and support women and girls. 

Discussions with a multitude of funders and philanthropy think tanks helped us to better understand the landscape and narrow down the list.

OUR SELECTION CRITERIA

  • Charities must be registered and in good standing with the Charities Commission to insure a certain level of accountability.

  • Charities must have a minimum of three years in operations, so we can assess how they have progressed.

  • Charities must have an annual income of between £500,000 and £1.5 million. Organisations in this size range are more agile in responding to the needs of their clients and are established enough to be financially more resilient.

For this first grant cycle, we have proceeded by invitation: after an initial desk review of many charities, we invited a smaller group of charities to apply, received applications at the end of March 2020 and then pursued our assessment, including virtual site visits with each of the semi-finalists in late April 2020.

OUR DUE DILIGENCE

We were guided by New Philanthropy Capital in our approach to due diligence and used the framework outlined in “What Makes a Good Charity”.  

It focuses on 4 areas:

  • Purpose: does the charity’s mission respond to a well-defined need?

  • Impact: does the Charity achieve results?

  • People: how strong is its leadership, how sound is its governance?

  • Finance: is the charity financially secure?

With the challenges posed by the pandemic, we are also looking at:

  • How service delivery is impacted in the short and longer-term;

  • Whether the charity can sustain the crisis financially.

Not only did we virtually meet with each of the charities’ senior management (in lieu of the actual site visits that we had planned), but we also had structured conversations with three references - a funder, a volunteer and a partner - to gain a different, third-party perspective on the organisation.

PRISM’S DUE DILIGENCE 

Given that Impact 100 London is a collective fund operated under the auspices of Prism, the Gift Fund, each of our finalist Charities has also been reviewed and approved by Prism. Prism conducted its own extensive due diligence, separate and distinct from our due diligence, focussing primarily on governance and Trustees.  

OUR FUNDING

Our discussions with funders, think tanks and charities have also helped us confirm where the funding gap is: long term & core cost funding. We are offering:

  • Funding up to three years, with annual disbursements. This provides financial security to the charity and the breathing space to focus on delivery of services rather than be chasing money constantly

  • Flexible funding: core cost funding or project funding. Funders tend to prefer project funding over core cost funding because it is well delineated (time-bound, own budget) and therefore easy to link donated pounds directly to results and change. However, this leaves charities struggling to find funding for core costs – which are costs not directly related to a project but across projects including Executive Director salary, rent, IT systems - the essential backbone of an organisation, without which projects and impact can’t be delivered! 


This year, we gave charities a choice between project and core. Core funding is central to our approach as we look at the whole organisation, beyond specific projects. We want to fund what it takes to make them strong and able to better serve their clients.