The Power of Mission-First Investing
One year ago, the Boston Foundation invited its Donor Advised Fund (DAF)holders to engage in impact investing through a unique Recoverable Grants Pilot. Impact investing expands philanthropists’ toolkits, giving them the opportunity to have a powerful impact today with the funds they would otherwise have invested for long-term charitable giving.
TBF offered four thematic portfolios to fund advisors, each with the potential to recover up to 100% of their capital at the end of six years. The portfolios included pre-vetted, local organizations with a strong record of advancing equity in our community.
A total of $6,095,000 was invested across the portfolios. This is a summary of the funds invested in each of the portfolios and the work being supported by those investments.
Repayment Status:
The symbols below indicate each investment's repayment status:
⬤: Organization on track for repayment at the completion of term
⬤: Potential issues with organization's repayment by the completion of term
⬤: Organization not currently expected to repay by completion of term
BIPOC Small Business Lending
Through this portfolio, a total of $1,537,500 was invested in four organizations:
Ascendus ⬤
Ascendus empowers low- to moderate-income business owners by offering access to capital and financial education.
Through its Furthering Access to Entrepreneurs of Color Initiative, Ascendus disbursed the allocation from TBF—$384,375 in capital—to 12 business owners, all entrepreneurs of color, in Greater Boston..
Local Enterprise Assistance Fund ⬤
LEAF (Local Enterprise Assistance Fund) promotes human and economic development by providing financing and assistance to cooperatives and social purpose ventures that create and retain jobs for low-income people.
In addition to investing $1,351,550, including $384,375 from TBF, in 32 small businesses, LEAF counseled 16 entrepreneurs and provided one-on-one assistance to 81 clients, through eight workshop and webinar sessions.
Nectar Community Investments ⬤
Nectar Community Investments (Nectar) deploys resources to historically disinvested individuals and their communities.
Nectar has deployed all funds, which totaled $384,375, except for $40,875 earmarked for a commercial loan currently in the pipeline. With support from TBF donors, Nectar deployed $343,500 in total capital consisting of three loans. A loan of $90,000 supported the acquisition of a hair salon in Haverhill. The loan was made to the real estate holding company where the salon is located. The company is owned 50/50 by a white male/female couple. It employs up to five stylists at maximum capacity. The second loan was $96,000, made through two loans, one for $66,000 and one for $30,000. The funds were used to repair damage from a burst water pipe in a building that housed a Latina-owned restaurant and provide working capital to get the restaurant back up and running. The business provides four full-time jobs and one part-time job in the community.
Massachusetts Housing Investment Corporation ⬤
MHIC (Massachusetts Housing Investment Corporation) provides innovative financing for affordable housing developers and small businesses.
With TBF funding of $384,375, MHIC was able to finance $5.2 million in construction contracts to two BIPOC subcontractors. MHIC also allowed subcontractors to take on a “stretch job” without using their standard program administrators.
Climate Justice
Through this portfolio, a total of $1,537,500 was invested in four organizations:
Capital Good Fund ⬤
Capital Good Fund used its $579,167 investment to directly originate 31 DoubleGreen Weatherization Loans (ranging from $500 to $25,000) and DoubleGreen Weatherization Plus Loans of $25,000-$50,000), supporting 31 low-income Massachusetts homeowners and saving money for some 91 individuals, reducing gas emissions and achieving whole-home electrification.
As a result, the families saved an average of $1,000 on their annual utility bills, experienced improved indoor air quality, greenhouse gas reductions, and job creation for green, equitable jobs for Capital Good Fund installers.
Massachusetts Housing Partnership ⬤
A deployment of $520,833 to MHP provided low-cost predevelopment resources to existing affordable housing projects for decarbonizing assessments and other types of early-stage project scoping. This funding will best position and prepare properties for capital improvements that reduce energy use and minimize carbon emissions.
MHP is working with the Community Economic Development Assistance Corporation, or CEDAC, which is a quasi-public lender and the leading provider of early-stage short-term predevelopment and acquisition financing, as well as technical assistance, for affordable housing development in Massachusetts. MHP will on lend to CEDAC, at 0% interest, for use in its predevelopment loans. The repayment timeframe aligns with the TBF repayment timeline.
Sunwealth ⬤
Sunwealth invests in a better energy future by financing and managing solar projects that benefit diverse communities through clean power, carbon reduction, cost savings and job creation. Sunwealth partners with skilled local solar installers, community organizations, local businesses, and investors to change who benefits from renewable energy by changing the way it is invested.
With TBF’s funding of $579,167, Sunwealth was able to construct five community-based solar projects atop affordable housing properties in Dorchester and East Boston, delivering more than $500,000 in energy cost savings and 11,769 metric tons of carbon reduction over the lifetime of their operation. The nonprofit partners were the Neighborhood of Affordable Housing, and the Planning Office for Urban Affairs.
Equal Opportunity for Families
A total of $1,257,500 was invested in four organizations:
Ascendus ⬤
Ascendus empowers low- to moderate-income (LMI) business owners by offering access to capital and financial education. Through its Childcare Provider Initiative, four childcare providers, all entrepreneurs of color, received $121,490 in capital. With an average loan size of $30,000, Ascendus used $628,750 in TBF funding to provide microloans to home-`based childcare centers. Two-thirds of the loan recipients are immigrants, and the funds were disbursed to childcare providers in Brighton, Jamaica Plain and Swampscott.
Jobs for the Future ⬤
Jobs for the Future partners with organizations to design solutions, scale best practices, influence policy and action, and invest in innovations. It works to create learner and worker opportunities, strengthen education and career navigation, integrate learning and work, and build strong regional economies. Jobs for the Future (JFF), which received a total of $628,750, made a $100,000 equity investment in KANU, a Providence-based marketplace that helps aspiring entrepreneurs build, launch and grow new ventures. Through KANU, it reached 15,700 students and supported 840 stores. Another $200,000 went to Franklin Apprenticeships, serving 293 apprentices with a 100% job placement rate. Another $200,000 was invested in Maro, an early intervention and risk platform for youth with mental health symptoms. Some 3,000 students were served. In addition, $300,000 was invested in Upright, a platform for digital upskilling and reskilling, that partners with universities and community colleges.
Equitable Housing
A total of $1,562,500 was invested in three organizations:
Local Enterprise Assistance Fund ⬤
LEAF (Local Enterprise Assistance Fund) promotes human and economic development by providing financing and assistance to cooperatives and social purpose ventures that create and retain jobs for low-income people. LEAF allocated $520,833 of TBF’s investment to refinancing a $3 million short-term acquisition loan into permanent financing for Boston Neighborhood Community Land Trust. The loan is being used to provide permanent financing for more than 30 units of deeply affordable properties, with the goal of having them stay affordable permanently.
Massachusetts Housing Investment Corporation ⬤
MHIC (Massachusetts Housing Investment Corporation) provides early-stage financing for affordable housing developments sponsored by emerging developers. With an investment of $520,833, MHIC leveraged $3 million of early-stage financing to three emerging developers in low-income neighborhoods. As a result, 60 new units were added to the region’s housing stock, with the potential for wealth generation through 18 homeownership units.
Massachusetts Housing Partnership ⬤
MHP (Massachusetts Housing Partnership) works with communities to create innovative policy and financing solutions that provide affordable homes and better lives for the people of the Commonwealth. It works to increase affordable housing as well as creating housing that is sustainable. With TBF’s funding of $520,833, MHP approved financing to four emerging developers for a total of $950,000 in funding, resulting in 292 units of mixed-income housing and 24 homeownership units.