Comparative Analysis of the First 10 Pay for Success Projects in the United States

Nonprofit Finance Fund

Social innovation financing, such as Pay for Success (PFS), is transforming the way nonprofits are funded. In the PFS model private funders (e.g., foundations, banks and businesses) provide upfront capital to high-performing social service providers and evaluators rigorously measure outcomes to ensure providers achieve impact. The real promise of Pay for Success (PFS) is directing resources toward high performing providers and innovations that demonstrate results. However, acquiring, measuring and analyzing quality data to demonstrate results and impact remain an ongoing challenge for many nonprofits. This report describes ten PFS projects and provides insights into the inner workings of these efforts. As results-based approaches continue to grow this core resource can serve as a helpful guide for those contemplating PFS in that it examines project goals and project design; the partners and stakeholders involved in the initiative; the fundamental data, evidence, and evaluation plans; governance and investment structures, including repayment terms and investor profiles; and project costs. Particularly useful to those looking to better understand PFS is the clarification on some of the terminology and definitions commonly used in an effort to advance a common language for the PFS field.

Global Topics: Nonprofit Capital
Focus Areas: Nonprofit Capital
Resource Types: Publication