Community Development Innovation Review
April 2013
«
Past issues
Success Begins with a Feasibility Study
Pay for Success (PFS), a form of social impact financing, is receiving international attention as a way to pay for scaling up high-return interventions, ranging from prisoner rehabilitation to infant health. It is attractive because risk of failure is shifted from taxpayers to the private sector; if programs don’t work, government doesn’t pay. Government pays for success by rebating a large portion of the savings from programs that work to private investors in those programs. If there are no savings, that is if interventions do not reduce government costs, there is nothing to rebate to investors. In this article, I review contracting and time-to-completion considerations with particular attention to feasibility studies, the critical first stage of establishing a social impact finance program.
Download the article (pdf, 197.03 kb)
Other articles in this issue
Community Reinvestment Act (CRA) Banks as Pioneer Investors in Pay for Success Financing
The Real Revolution of Pay for Success: Ending 40 Years of Stagnant Results for Communities
Pay for Success is Not a Panacea
The Promise of Pay for Success
Social Impact Bonds: Lessons Learned So Far
Pay for Success: Understanding the Risk Trade-offs
Learning from the Low Income Housing Tax Credit: Building a New Social Investment Model
Using Social Impact Bonds to Spur Innovation, Knowledge Building, and Accountability
Social Impact Bonds: Using Impact Investment to Expand Effective Social Programs
Innovation Needs Foundation Support: The Case of Social Impact Bonds
Pay for Success: Opportunities and Risks for Nonprofits
Government’s Role in Pay for Success
Rikers Island: The First Social Impact Bond in the United States
Human Capital Performance Bonds
Pay for Success: Building On 25 Years of Experience with the Low Income Housing Tax Credit
Can Pay for Success Reduce Asthma Emergencies and Reset a Broken Health Care System?
Supporting At-Risk Youth: A Provider’s Perspective on Pay for Success
Bringing Success to Scale: Pay for Success and Housing Homeless Individuals in Massachusetts
Making Performance-Based Contracting Work for Kids and Families