First thing today a group of smartly dressed executives are sitting down in an office near Paddington in London to take a decision on whether to back a new business.

The size of the investment, less than pounds 1m, is small beer by City standards, but the initiative will be watched with acute interest everywhere from Whitehall to the run-down district of St Paul’s, in Bristol.

The potential financiers are from Bridges Community Ventures – a private sector group owned by Apax Partners, 3i and New Look founder Tom Singh – which is hoping to spark a small capitalist revolution.

Politicians have become increasingly aware that pumping public money straight into impoverished parts of Britain can create a culture of dependency that deepens problems, rather than solving them. Borrowing ideas from the US, a social investment task force has spawned the Bridges business, which aims to produce entrepreneurs and sustainable businesses to tackle social disempowerment and decay.

Some see this new community venture from the capital sector as a living example of the third way ideology that informed the early political thinking of the prime minister. And there is evidence for such thinking: the pioneering force behind Bridges is Michele Giddens, daughter of original third way architect, academic Anthony Giddens.

Michele is one of three executive directors who will troop into the office at 1 Craven Hill and take a decision that could make or break a fledgling enterprise.

It would be the fourth and latest package put in place by Bridges, which raised pounds 20m last year from a range of blue chip organisations and won a further pounds 20m to match it from government.

Big hitters

“I am not sure about the third way thing,” says Ms Giddens, “but there is no doubt that companies and investors want to be doing something that has a purpose beyond just making money”.

There is certainly nothing flaky or soft-headed here. Seated on the Bridges board is just about every big hitter in the venture capital sector: Sir Ronald Cohen of Apax, Peter Williams of 3i and Nigel Doughty of Doughty Hanson. It also has Tom Singh, founder of retailer New Look, as a non-executive. And it has already encouraged HSBC, Lehman Brothers and the Royal Bank of Scotland Group pension scheme to support its first fund, aimed at making individual investments of between pounds 150,000 and pounds 2m.

So far it has put pounds 800,000 into Trust the DJ, a talent agency which manages and books more than 30 disc jockeys, hosts an official website for over 70 of the world’s top disc spinners and has released 35 albums. They have been active in schools, offering training courses to young women and black men who can find themselves disadvantaged in the mainstream jobs market. Bridges has also invested pounds 125,000 into a start-up company, Simply Energy, which provides a price comparison service for energy consumers and is working with stores such as Home Base.

Around pounds 500,000 has gone into Touch ‘n’ Glo in Coventry, which has a new range of intelligent lighting and security systems. A similar wad of cash has gone into Eyebright, a start-up providing almost instant cataract surgery facilities to the NHS and private sector health care providers where space shortages can put eye operations to the back of the queue.

The venture capital money is meant to be complimentary to government-led regional venture funds and other public money directed to particularly depressed areas, such as Merseyside and South York shire. Ms Giddens, who combined a degree in PPE from Oxford with an MBA from Georgetown in America, points out that all the companies in which she has invested serve a useful social purpose as well as making money and, it is hoped, creating jobs.

She is coy about what rates of return investors can expect, but says the latest research from America – where the community ventures sector is much more advanced – shows venture capital funds reaching double-digit performance.

The chancellor has already indicated in the last Budget that he is minded to support such venture funds, but much will depend on the success of the first Bridges initiative.

Ms Giddens boasts some substantial international experience, having worked for the International Finance Corporation, Ernst & Young and numerous oth ers, based everywhere from Washington to Moscow, before arriving at Apax early last year.

Yet the fear must be that this fragile new sector requires the support of a Labour government to keep it on track, although Ms Giddens is not so sure.

She argues that burgeoning interest in corporate social responsibility has made even the biggest multinationals mindful of their need to retain legitimacy by looking after a wide range of stakeholders.

And as she explains: “You can see from the quality of CVs that come into this office, looking for jobs with us, that many people now want to feel good about what they do as well as make a decent living.

“If you noticed the successful bond raising exercise for [fair trade group] Traidcraft, there seems to be real momentum building up in this area.”