News and Insights

By Brian Beachkofski and Marcia Chong In the Pay for Success (PFS) model, governments, funders, and nonprofits work together to construct projects that measurably serve our most vulnerable populations. Within this cross-sector mix of stakeholders, local service providers play a critical role. Bringing local expertise to the table, these on-the-ground organizations are responsible for delivering services, and achieving the outcomes agreed to in the PFS contract. FrontLine Services is one such organization. Third Sector worked closely with the community nonprofit to explore how Pay for Success could scale its continuum …

Pay for Performance (P4P) contracting can be a powerful tool to align limited resources with results. The innovative contracting model has been leveraged across the country to address our most pressing social problems. Third Sector’s first Social Innovation Fund (SIF) Competition is empowering nine governments and organizations to explore the impact of performance-based contracting across issue areas, from homelessness to maternal health, from criminal justice to education. In 2016, Third Sector is building off this work by launching a second round SIF competition. This competition is dedicated to only one …

Third Sector Capital Partners, Inc. (Third Sector), a nonprofit advisory services firm that is leading the development of Pay for Success projects across the U.S., has launched a national competition to support government projects in the area of youth workforce development. The competition is being funded by a grant from the Social Innovation Fund (SIF), a key White House initiative and program of the Corporation for National and Community Service. “This competition will allow new jurisdictions around the country to explore the viability of PFS in the area of youth …

Associate John Perovich and Analyst Jake Moy have been featured in Rooflines, the blog of Shelterforce, a publication of the National Housing Institute. Their piece, “Paying for Success in Permanent Supportive Housing” explores how the innovative contracting model can construct effective housing solutions for chronically homeless individuals. “Interest in the PFS model is growing. A total of $8.6 million of federal funding has recently been designated for PSH programs leveraging the PFS model. For jurisdictions considering a bid for these funds, the project in Santa Clara County offers several insights …

Pay for Success (PFS) projects call for an ongoing dialogue with multiple community stakeholders. Two PFS feasibility studies, supported through grants from the the Corporation for National and Community Service’s Social Innovation Fund, are underway in Washington State: Department of Early Learning and Thrive Washington study, and Health Care Authority study. To begin this dialogue in Washington, Third Sector worked with partners to host an educational convening for interested stakeholders to learn more about PFS. The November 18th event included panels with experts involved in the launched PFS projects in …

John Grossman, Co-President at Third Sector Capital Partners, Inc., was featured in a Government Executive by Patrick Lester, entitled, “Does Pay for Success Work? Define ‘Success'” “We shouldn’t make the perfect the enemy of the good,” agreed John Grossman, co-president at Third Sector Capital Partners. “The goal is continuous improvement. Success comes in changing the way government and the social sector do business.” Read the full article here.

We opened up our San Francisco office in late October to host an exciting conversation about how Pay for Success (PFS) is impacting our most at-risk populations across the country. The event, “Scaling Social Impact: Pay for Success & Social Impact Bonds”, was co-hosted with the Net Impact San Francisco Professional Chapter. Net Impact is a global community of professional leaders and students creating positive social and environmental change in the workplace and the world. Third Sector has been committed to furthering Net Impact’s mission by participating in chapter and …

Constructing Pay for Success contracts is an inherently cross-sector practice. Each of our projects brings together government, nonprofit, and private stakeholders to address our most pressing social issues. In a sense, the Pay for Success (PFS) model itself is an acknowledgement that no one organization can create effective and sustainable change on their own, without reaching across sector boundaries. The multi-party nature of our work brought us to SOCAP15, a national conference of social impact entrepreneurs and organizations that share our cross-sector approach. At SOCAP15, Third Sector participated in two …

Nonprofit Finance Fund (NFF) has announced two of our partners, Santa Clara County and Hillside Family of Agencies, have been selected as grant recipients through the federal Social Innovation Fund (SIF) Pay for Success initiative. Santa Clara County has been awarded the SIF grant to launch a Pay for Success project serving individuals with acute mental illness. The selected service provider, Telecare Corporation, will focus on clients who have frequent stays in psychiatric emergency care, and ensure these patients are stabilized in less restrictive, community-based environments. The SIF grant supports …

What impact can Pay for Success contracting have on workforce development? What opportunities does the new Workforce Innovation and Opportunity Act (WIOA) present for Pay for Success projects? Earlier this month, Third Sector Capital Partners partnered with Year Up to explore these questions in the kick-off webinar of a series hosted by America Forward, Alternative Staffing Alliance, and SE4Jobs. Our discussion covered the basic stages of Pay for Success contracting, opportunities social enterprises can fit into performance-based contracting, and how Pay for Success can be applied within the workforce development space. Interested? Access a recording of the webinar below. The webinar was presented by Associate …

What impact has PFS had on the United States social sector? As the model gains traction, what can PFS achieve in the future? Next week, TSCP Co-President and Co-Founder Caroline Whistler will be tackling these questions at SOCAP15, an annual conference of leading impact investors, social entrepreneurs, and cross-sector practitioners. On October 6th and 7th, Caroline will be presenting the PFS model, its development, and its ability to more efficiently drive government resources toward more effective social services. You can catch Caroline at SOCAP15 in San Francisco at: Social Sector Transformation through Pay for …

The Santa Clara County Board of Supervisors approved the selection of Telecare Corporation as the service provider for a Pay for Success project to improve stability and wellness of some of the County’s most severely mentally ill individuals through intensive outpatient treatment, case management, and supportive services. “Improving the stability and wellness of members of our community who suffer from acute mental illness is a high priority for the County,” said President Dave Cortese, County of Santa Clara. “We are hopeful that through this project, we’ll be able to offer …

Nonprofit Finance Fund has published blog posts interviewing Third Sector and its project partners in Salt Lake County and Illinois about their experiences developing PFS projects in both jurisdictions. Titled “Voices from PFS Pioneers”, both projects explain the genesis of project development, unique challenges, and innovations developed through project construction. Third Sector is working with the State of Illinois and Conscience Community Network on the Illinois Dually-Involved Youth Project, which seeks to improve outcomes for youth involved in both the foster care and juvenile justice systems. Third Sector is also …

The Alliance for Children and Families launched Disruptive Forces in Action to showcase the innovative ways its members and others in the sector are harnessing the six forces introduced in its 2011 report, Disruptive Forces: Driving a Human Services Revolution. In its case study of Attracting Investors, Not Donors, Alliance member Hillside Family of Agencies and issue expert Third Sector Capital Partners, Inc. discuss Pay for Success, an emerging funding model that unites nonprofits, government, and philanthropic and corporate investors around achieving a social return on investment. Hillside has partnered with Third …

Third Sector Co-President & General Counsel, John Grossman, is interviewed by CommonWealth Magazine on the promise of Pay for Success and the Massachusetts Juvenile Justice Initiative. Man in the middle: John Grossman brings government, providers, and money together for pay-for-success projects “JOHN GROSSMAN calls himself an intermediary. It’s an unusual job description, but it’s one that captures what he does putting together complex deals that leverage money from the private sector to fund social service work for government. Grossman is the man in the middle, trying to address social ills by …

Mayor Martin Walsh announced on Monday an effort to identify ways to improve post-high school graduation outcomes for Boston Public Schools’ students. The City has worked with Third Sector to release a Request for Information (RFI) to identify effective programs and services that will increase access to higher education and training and would be funded through a Pay for Success model. The Office of the Chief of Education, along with the Boston Public Schools, have put forth efforts to improve outcomes for youth, including the High School Redesign effort and Success …

It’s graduation season, which means people across the country are thinking about entering the job market. Third Sector Capital Partners, a grantee of the Social Innovation Fund’s Pay for Success program, is currently working to improve employment outcomes for urban young adults by working with Year Up, a Boston-based organization that seeks to improve employment outcomes for urban young adults. Year Up’s Professional Training Corps (PTC) model is an intensive one-year program for 18-to-24-year-olds who are disconnected from both school and work. In 14 locations nationwide, Corps participants spend six months …

Third Sector was named a 2015 Game Changer by the Boston Globe Magazine in this week’s issue, which featured CEO and Co-Founder George Overholser’s bet “that data will help make a difference solving some of the most intractable social problems, from juvenile delinquency to homelessness.” The article also cites Third Sector’s work on the Massachusetts Juvenile Justice PFS Initiative, where Roca, Inc. is working with over 900 young men in Boston, Chelsea and Springfield in order to reduce the days they spend in jail and increase their employment opportunities.

John Grossman, Co-President and General Counsel, and Marcia Chong, Senior Analyst, have authored a blog post for the Harvard Law and Policy Review. Pay for Success: Pay for Success Calls for Innovation in Non-Profit, Contract and Securities Law focuses on how innovative thinking in nonprofit and tax law, government contracting, and securities law will be needed to support the growth of the PFS field. Both John and Marcia have been intimately involved in developing the PFS contracts and other legal agreements for the Massachusetts Juvenile Justice Initiative and the Cuyahoga County …

In December 2013, The California Endowment funded the National Council on Crime and Delinquency (NCCD) and Third Sector Capital Partners, Inc. (Third Sector) to conduct a feasibility study on restorative community conferencing (RCC) to better understand its potential to be used in a Pay for Success (PFS) project. RCC shows promise as an intervention that could be scaled through PFS given its preventive focus and the promising initial outcomes of youth served through RCC. NCCD and Third Sector focused their feasibility analysis on Alameda County, California, where the Community Works …