California Pay For Success Initiative

Irvine FoundationNonprofit Finance Fund and The James Irvine Foundation have launched the California Pay for Success Initiative, a $2.5 million effort to catalyze innovative approaches to paying for improved social services throughout the state.

The California Pay for Success Initiative is providing flexible funding and expert support to help nonprofit and government leaders structure Pay for Success agreements in California over the next two years. In addition to helping finalize these agreements, the Initiative will nurture a cohort of leaders that will learn from each other and share knowledge as they take Pay for Success from concept to reality. 

On May 5, five projects, organized by leaders exploring the Pay for Success model for funding social services, were selected by Nonprofit Finance Fund to be part of the California Pay for Success Initiative. Read the Press Release here.

See the initial Press Release announcing the Initiative in January 2014 here.

For more information about this initiative, or if you are interested in providing support to leaders pursuing PFS projects and receiving awards under this initiative, please contact: Jessica LaBarbera, Director, Nonprofit Finance Fund at JLaBarbera@nff.org.

Interested in learning More about Pay for Success?

Visit NFF's Pay for Success Learning Hub To Learn More

Pay for Success is an approach to funding social services designed to improve outcomes and ultimately reduce the costs of addressing these issues. In a Pay for Success agreement, private investors provide funding for preventative or interventional services up-front, and government reimburses these investors with a return on their investment, only if results are achieved. In doing so, private investors take on initial risk, governments only pay for outcomes, and cost-saving programs with demonstrated effectiveness have access to new financing from private sources. While Pay for Success projects are underway in a few other states, there are none yet launched in California.

Pay for Success aims to:

  • Shift funding for social services toward prevention and early interventions, saving money and improving outcomes for community members.
  • Save taxpayers money because government pays only for results. 
  • Put private money to work for public good.
  • Bring new private funding to scale preventative social services that have proven results.
  • Align stakeholders’ interests and incentives around shared goals.

The following resources provide more information on Pay for Success:

California Pay For Success Initiative

Inquire about an NFF Loan