Pay for Success

Pay for Success (PFS) is a funding approach where private investors, governments, or nonprofits finance social programs upfront and are paid only if the program achieves specific, measurable outcomes. This model shifts the financial risk away from taxpayers and aligns incentives to improve effectiveness. If the program succeeds in delivering desired results—such as reducing homelessness or improving education—stakeholders receive funding or returns. If it doesn't, investors may not be repaid. PFS encourages innovative, data-driven solutions and ensures resources are invested in effective initiatives that make a tangible difference.