Lessons from the Kresge Foundation and the California Endowment on impact investing

Last week, TFN’s Smart Growth California hosted a video conference for funders to learn about the challenges and opportunities for impact investing in low-income communities and other communities in which it is typically harder to deploy capital.  A recent blog post summarized the highlights of the webinar.

Impact Investing: A Giving Tool for Foundations That’s Gaining Traction

For a few years now, impact investing has been a buzz topic amongst funders. Because traditional forms of capital seldom reach the most high-needs communities in our regions, philanthropic capital investments can serve as an intermediary to boost the ability of individuals, businesses, and communities to succeed in the traditional marketplace.

A growing number of foundations are working toward aligning their programmatic and traditional grant-making goals with a variety of investment tools to enhance opportunities for low-income communities. The Global Impact Investing Network’s annual survey reported that in 2016, $114 billion of impact-capital was deployed by the 209 asset owners surveyed. This is likely a fraction of those who are beginning to utilize impact investing as a giving tool.

Many foundations that serve low-income communities of color are leading the way in developing a model to encourage broad-based, place-based impact investing across all asset classes. The California Endowment and The Kresge Foundation are two of the major foundations that have taken the leap to explore new tools for creating change in their target communities.