FPIP raising A$250 million impact investment vehicle

For Purpose Investment Partners (FPIP) – an impact investor founded last year by former National Australia Bank CEO Andrew Thorburn and ex-Macquarie banker Michael Traill – is preparing to raise a A$250 million strategic investment vehicle after making two standalone investments in social housing and social services staff training.

The FPIP social impact investing model involves applying the same financial discipline and strategic acumen that Thorburn and Traill used in the commercial banking sector to the social sector, where operators are often sub-scale and lacking proper systems and talent, or are publicly listed and driven by cost and earnings pressures.

FPIP claims to be creating a third way – which Traill describes as ‘Capitalism 2.0’ – where areas of critical social need that involve significant government funding are operated under sophisticated business disciplines typically applied to large-scale enterprises. The model aims to provide a stable, annual return of about 12% to investors over a 10- to 15-year horizon. Most of the income earned from the investments is backed by government subsidies.