This case study is part of AVPN Catalytic Capital in Asia research, which explores how catalytic capital has been deployed in different parts of Asia.
Catalytic Capital in Asia
Structure: Private investment company
Year established: 2018
Market-based in: Australia
Market active in: Australia, New Zealand, the UK and Europe
Key Impact Areas: Alternative energy, gender equality, housing, infrastructure and more
Affiliated organisations: Besen Family Foundation
Tripple is a 100% impact family office that deploys capital to high-impact enterprises that are committed to enabling a just and regenerative future whilst at the same time delivering sustainable returns. Tripple works across all asset classes, including public and private equity, venture capital, real assets and fixed income, and incorporates both investing and grantmaking to use capital as a force for good. The firm engages in catalytic and innovative financing models such as outcome-based payments and income share agreements.
Catalytic capital in action
Blending philanthropy and investments to address capital gaps and deepen impact
Tripple takes a total portfolio approach to investment, applying an impact lens across all its investing activities. It rejects the traditional model of making a profit through investments on the one hand and focuses on creating positive social and environmental impact through philanthropic activity on the other.
Its holistic approach is underpinned by a prioritisation of context, issues and needs along with being flexible in choosing the right type of capital – equity, loans, grants, or a combination, or financing mechanism to see the impact it seeks to achieve. For example, impact investments can be a more attractive financial option than grantmaking when the solutions proposed are market-based and deploying concessionary investment capital would be more cost-effective than a grant. Hence, as a funder, it is important to rely not only on one tool but to explore different approaches to address the market needs.
The firm also allocates a proportion of its investment capital to high impact opportunities where the risk/return rate is not in line with its commercial investments, and often with more patient timelines. This may look like concessionary capital or market-rate returns with higher risk than traditional investors may be comfortable with and was introduced to increase the total impact of the portfolio and fill a unique gap where capital is hard to come by. These investments often mean the investee can trial a new model and, once proven successful, open up opportunities for further funding from others on more commercial terms, thus amplifying the effect of the initial catalytic investment.
Experimenting with outcomes-based contracts to build proofs-of-concept
Tripple demonstrates a spirit of responsiveness and innovation by exploring novel financing models. In 2022, Tripple supported the creation of a 3-year multi-million dollar outcomes-based contract to support people with disability to stay in jobs with training and career support. In Australia, 93% of working-age people with disability who are unemployed report at least one difficulty finding work, with their disability being the most common reason. White Box Enterprises, in partnership with the Australian Government’s Department of Social Services, will deliver a three-year trial that will see social enterprises paid directly by the government for their verified employment outcomes through an innovative payment-by-outcomes model. The pilot, in partnership with select jobs-focused social enterprises, aims to provide job opportunities for 170 long-term unemployed people living with a disability. Tripple, the Macquarie Group Foundation, and Hand Heart Pocket Foundation provided seed capital to build the proof-of-concept of this innovative financing model. They funded the upfront costs and provided working capital to get the trial underway, and investor repayments and returns are linked to outcomes achieved.
Deploying risk-tolerant capital to address funding gaps
Australia’s mainstream education curriculum often lacks integration of cultural knowledge, and the country observes a higher level of disengagement and lower school attendance rates among Aboriginal and Torres Strait Islander children compared to others. In light of this, Tripple joined a syndicate of investors and contributed to the provision of loans to support the establishment of Ngutu College, an independent school providing equitable access to quality innovative education for Indigenous students in Australia. This investment addresses a capital gap for leasehold improvements, asset purchases, and working capital which the school would have been unable to fund through bank loans, which typically come with prohibitive timelines and conditions that are sometimes unachievable for a social enterprise at seed-stage. With a risk profile that is higher than usual investment, and provided to a small-scale enterprise with no past track record, Tripple and its partners’ investment has enabled the school to operate, and it has also built a proof-of-concept for the provision of inclusive education in Australia. It has now grown to 230 enrolments across 10 classes and has supported 130 children with additional adjustments, including disability, trauma or other mental ill-health conditions.
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Catalytic Capital in Asia