RSF’s Pricing Meeting: Revolutionary Simplicity?

August 9, 2010

By Elizabeth Ü

This past June, while most financial institutions set their third quarter interest rates based on global financial market conditions, RSF staff held our sixth quarterly pricing meeting in community with our borrowers and investors. Rather than study abstract numbers on computer screens or ticker tapes, we met in the beautiful (and LEED certified) offices of Seventh Generation in Burlington, VT, to have a conversation among stakeholders – hearing each others’ needs, and considering the consequences of raising or lowering the RSF Social Investment Fund quarterly interest rate, and subsequently, RSF Prime, the rate for our borrowers.

RSF investors and borrowers traveled to Burlington from all across New England to meet with myself, Taryn Goodman (RSF Impact Investing Manager), and Don Shaffer (RSF President & CEO). Nicole Dawes of borrower Late July drove several hours from their Cape Cod offices for the occasion. Dan Fulham of borrower Otter Creek Brewing Company/Wolaver’s Organic Ales made a special trip to Burlington in the midst of a busy work itinerary involving several Northeast destinations. Dale Rodriques of Mary’s Gone Crackers traveled all the way from Chico, CA, to participate in both our pricing meeting and the Slow Money Alliance National Gathering (more on that below). Cory Greenberg represented Ten Directions, which operates the Guest House, a retreat and conference center in Connecticut. (An experienced social finance practitioner, Cory has served on the board of the Cooperative Fund of New England since its inception.)

The high number of borrowers representing RSF’s Food & Agriculture focus area was no coincidence. We planned this quarter’s pricing meeting to coincide with the RSF-sponsored Slow Money Alliance National Gathering, during which 600 investors, entrepreneurs, financiers, journalists, non-profiteers, and foundation staff gathered  just down the road from Burlington at Shelburne Farms to learn about the latest efforts to connect investors to local food systems, catalyzing new forms of social investing and philanthropy for the 21st century.

In fact, all of the investors who attended RSF’s pricing meeting also attended Slow Money’s event, including Ari Derfel, who announced that he has recently been appointed Slow Money’s new Executive Director!

The RSF pricing conversation covered a variety of topics. One investor noted that over the last several quarters, RSF’s financial returns to investors have been high compared to three-month CDs or money market funds, with much higher social benefit. “Why,” he asked, “aren’t there so many people invested that RSF would grow to a billion dollars in assets, serving hundreds more high-impact borrowers? The world needs that, society needs that!”

In fact, it is only because we de-coupled the RSF Social Investment Fund pricing from the London Interbank Offered Rate (LIBOR) that we have been able to offer any return to investors at all! Had we decided to continue linking our investor returns and borrower interest rates to LIBOR, investors would have had to pay RSF for the privilege of investing… which didn’t make sense given our investors’ needs, our borrowers’ ability and willingness to accommodate higher interest rates, and RSF’s own operating needs.  (For further details, see this post from November 2009 announcing the shift in how RSF sets pricing, plus a breakdown on how the numbers add up.  You may also be interested in this post from Siegfried Finser, RSF trustee and co-founder, on RSF’s decision to offer interest to investors at all.)

Ari’s reflections after the experience summed up my own favorite moments of the pricing meeting. “It was very encouraging,” he said, “to hear RSF investors who were willing to consider lower returns in order to support the work of the borrowers, and borrowers  who would pay higher interest rates on their loans if that meant that RSF could attract more investors, and therefore support even more projects [like the food companies that would present later during the Slow Money Entrepreneur Showcase]with loans.”

Several times over the course of the Slow Money National Gathering, Ari and others pointed to RSF’s pricing meetings as an example of the type of financial innovation the world desperately needs in order to bring money back to earth, and to bring personal (if not also spiritual) values back to financial transactions.

It amazes me to think that something as simple as bringing investors and borrowers together with RSF staff to discuss the terms of our relationship is a radical idea. Given how complex the financial world has become, is it possible that the very concept of simplicity has become revolutionary?

As is true of all of RSF’s innovations, we do not create direct, transparent, and personal systems, like the pricing meetings, with the intention of trade-marking them and keeping them to ourselves; quite the contrary, we hope that the idea of holding pricing meetings will catch on amongst other financial institutions.

After hearing people talk about the pricing meetings at the Slow Money event, at least one leader of another financial institution remarked, “That’s a good idea, maybe we should do that, too.”

We hope they will! If other institutions follow RSF’s lead, it will only accelerate our progress toward our mission to transform the way the world works with money.

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

Financial Insights from an Ashram

July 5, 2010

By Elizabeth Ü

Rocklyn Ashram in Victoria, Australia. The author, Elizabeth U, is seated on the right.

In March, I spent eight days at a yoga ashram in Australia. When I arrived, the director encouraged me to review a list of virtues known as the 18 “Ities,” and choose one to focus on during my stay. I chose “regularity,” encouraged by the notion that one can “relax into the regularity” of the unchanging daily schedule. Similarly, a little regularity applied to my personal finances has opened up a spaciousness in my approach to managing money.

The daily schedule at the ashram was the same every day, with only slight variations on weekends. Wake up at 5:30am. Asana (yoga) practice. Pranayama (breathing) practice. Meditation. Chanting. Breakfast. Karma yoga (work detail). More meditation. Lunch. A couple hours to read or study. Even more meditation. Dinner. Evening program.

It took me a couple days to get the hang of it (where do I go for the next session? how will I get my work assignment? can I really sit perfectly still for a full 40 minutes?), but eventually I did relax into the regularity of the ashram schedule. Freed from the burden of having to decide where to go or what to do, I was able to just be. And from that place of acceptance and flow, I was able to see just how much time and energy I normally devote to figuring out how best to spend my time in order to be more Efficient, Happier, Better.

Since returning to my usual routine at home, I have made an effort to cultivate that sense of spaciousness and acceptance for at least a few moments every day through the discipline of daily meditation practice. And I realized that I had already achieved something similar with regard to how I relate to money.

A peek into my journals from my last visit to Australia, back in 1998, reveals my early attempts at financial discipline. I was living within my means for the first time in my life (rather than depending on my parents), and was obsessed with monitoring my spending. I carefully recorded pages and pages of financial transactions, as if somehow the very act of writing everything down would provide assurance that my relationship with money was okay, that I had enough.

Looking back, I can see that this was the best approach I could come up with at the time, as odd as it may seem now. My current attempts at financial discipline are, thankfully, much less labor intensive. Like regular spiritual practice, the hardest part was making the commitment to start. But once I set up my financial system, it turned out to be much simpler than getting onto the meditation cushion every day, because nearly all of it happens automatically.

I started by assessing a year’s worth of bank and credit card statements. Given that my expenses are relatively stable year-to-year, it was easy to determine my monthly cost of living. Since I am fortunate enough to earn more than I spend, I have historically put the difference into savings or retirement accounts. Thus, income – expenses = savings + retirement. My next step was to determine how to divvy up my savings (which includes my RSF Social Investment Fund account) and retirement contributions every month. Once I sorted out those details, I set up automatic transfers to divert the appropriate amounts to the appropriate accounts at the various financial institutions I’ve chosen to work with.

Now, every month, whether I remember or not, my paycheck gets divided up automatically between my checking, savings, and retirement accounts. Paradoxically, this regular practice of saving has allowed me to relax around my spending, much as the regular ashram schedule allowed me to relax into my own being. I still monitor my checking account balance from time to time, but since I know that I’ve already designated the money in my checking account as fair game in terms of spending, I no longer need to worry about what I’m spending it on. I’ve even started using cash more so that it’s physically impossible to do so. And I have been amazed to watch my spending decrease along with my stress levels around money management. The unexpected consequence is that I’ve been able to increase my savings allotment!

There is one last piece which I have yet to implement fully, and that is to apply more regularity to my giving. I have already set up automatic gifts (recurring on a monthly basis) to some, but not all, of the non-profits I choose to support. I plan to set up regular gifts to the rest, plus automatic contributions to my RSF Donor Advised Fund so that I am ready in the event that an emergency, such as the earthquake in Haiti, or the more current oil spill in the Gulf of Mexico, calls for unexpected gifts.

Although I wasn’t consciously thinking about it in terms of “regularity” when I began to manage my money in the ways I have just outlined, I do think it turned out that way because I’ve been striving to align my own values and beliefs with the way that I work with money. Does your spiritual practice inform the way that you manage and think about your money? Please add to the conversation in the comments section below!

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

If you are interested in setting up automatic monthly investment contributions to an RSF Social Investment Fund account, please contact Mark Herrera at or 415.561.6160.

Defining Sustainable Agriculture – in Cuba

April 12, 2010

By Elizabeth Ü

In February, I visited urban farms and gardens in Havana, Cuba, a country often showcased as a model of “sustainable agriculture.” More recently, I attended the Agriculture 2.0 “sustainable agriculture” investing conference in Silicon Valley, CA. Both experiences got me thinking about what does – or does not – earn the right to be labeled by this often-used, vaguely-defined term.

How do you define “sustainable agriculture”? The terms organic, biodynamic, and Fair Trade have clear definitions, but does any one of these certifications (or combination thereof) constitute “sustainability” in agriculture? Does it matter how the farm, company, or cooperative entity is organized and managed? Does feeding people who are hungry constitute sustainable agriculture? Does the type of food matter? Who grew the food, processed it, distributed it, sold it? Under what working conditions? How far has the food traveled from farm to fork? How much (of what?) is enough? Where do you draw the line?

Here are a few of the contradictions I’m still struggling to reconcile with regard to what I saw and heard in Cuba. While my process of inquiry was similar during the Agriculture 2.0 conference – can one really define in-vitro meat as sustainable? what about open-ocean aquaculture?  – I will cover my reactions to that event in more detail in a future post.

I visited Cuba along with my fellow Food & Society Fellows. Our hosts, professors from the University of Havana, highlighted various facts and figures related to their country’s agricultural system, both in the classroom and during visits to several urban farms and commercial gardens right in Havana.

We frantically scribbled our notes, amazed at what we were hearing about Cuba’s food system: every month, an agronomist visits all the urban farms and gardens in a region, noting which pests or problems seem to be most frequent, and then there’s a conference to support the growers in learning how to most effectively address those issues. Each school in Havana has a farm in charge of producing their fruits and vegetables, about eight pounds per student per month.

Sustainable agriculture. Check.

I mentioned this last piece to one of our translators, excitedly explaining that it’s been a real challenge to connect farms and schools in the U.S., much less deliver that volume of vegetables directly from a specific farm to a school’s kitchen. She looked at me, confused. “They don’t eat vegetables in the school lunches here,” she told me. “What do the kids eat?” I asked. “Rice…” “And beans?” “Maybe beans,” she said, shrugging her shoulders.

Let’s assume that both parties were relating information that was true, based on their own (different) experiences. Maybe not ALL schools are directly connected to specific farms. Maybe not all children in Havana are getting eight pounds of fruits and vegetables through their school lunches every month.

Maybe it’s not sustainable after all.

More “facts” I jotted in my notebook: urban farmers have higher incomes than doctors. Fruits and vegetables generally travel less than 30 miles from the place they are grown to where they are sold.

Ah ha! Sounds sustainable.

One evening we ran into another group of Americans in our hotel lobby. Surprisingly, this delegation was also there representing agricultural interests… but from what we could gather, it appeared that they were in Cuba to sell agricultural products. It was certainly a revelation to me that ANY products from the U.S. could be sold in Cuba. In fact, we heard from several sources that Cuba, a country regaled for its local food system, imports roughly 75-85% of its food. The majority of imports are from the U.S., including rice, wheat, soy, chicken, pork, and apples. When we inquired, both at the university and in the field, we were unable to get any clear answers as to whether or not there were attempts underway to reduce Cuba’s dependence on foreign imports.

The plot thickens.

So most of the fruits and vegetables in Cuba are local and organic – or so we heard, so we believe. But I couldn’t shake the knowledge that farmers in Cuba don’t use pesticides, herbicides, fungicides, or chemical fertilizers in part because the U.S. won’t allow U.S. companies to sell these products in Cuba. The farmers we visited told us that they would use at least some of these products, particularly fertilizers, if they were available. (Nitrogen sources are scarce, and we saw few farm animals – which produce fertilizer in the form of manure – during our visits). And across the board, everyone who met with us expressed hope that the U.S. embargo prohibiting exports to Cuba – or at least, the majority of exports – would be lifted.

How can I ever gather enough information to determine if something is sustainable or not?

Ultimately, I believe that my desire to define something as “sustainable” or “not sustainable” is a red herring. Sustainability is not a label that can be earned once and for all. Rather, it is a journey that a person, a farmer, a company, a country must take constant steps toward, assuming that is even the intention in the first place.

In my own journey, this trip to Cuba reminded me that even within a complicated picture, there are points of inspiration and hope: a long row of perfect bok choy, in the middle of Havana, tended carefully by worker-owners of that urban garden. An award-winning bonsai artist whose beloved, private collection of ornamental plants almost outnumbered his plants available for sale. A tiller fashioned out of a single old tire, weighed down by the driver of the oxen that pulled it along. Ultimately, these are the memories of Cuba I want to carry with me, each one contributing to my newly-expanded vision of what sustainable agriculture can be.

What are your definitions of sustainable agriculture?  We welcome your comments!

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

The Impacts of Moving Your Money

February 22, 2010

By Elizabeth Ü

Moving your cash out of big banks and into local banks and credit unions is one way to move your money, but even this choice doesn’t address one of the major issues I have with banks, regardless of size: how are they lending the money I’ve deposited? Can you even find out if their lending practices align with your own values?

Two years ago, I embarked upon an effort to move my money away from Bank of America (where I had my checking account) and ING Direct (where I had the bulk of my cash savings, both in a savings account and in several laddered CDs), and into banks whose activities I felt were more aligned with my own values. In the case of Bank of America, I simply could not justify spending the majority of my waking hours working at RSF and thinking about how to invest in companies that were solving social and environmental problems, while much of my own savings were helping contribute to those problems.*

I didn’t have the same concerns, per se, about ING Direct – partially because I couldn’t find any information about their policies – though it was clear to me that there were other places to park my cash that were putting it to work in ways I knew I could feel good about.

Here were the guiding principles I used in looking for a checking account:

  • First and foremost, I wanted a bank that I had some kind of personal connection to, whether directly or through my professional connections.
  • I wanted to find a small bank that was committed to social and environmental values in some way.
  • I preferred to bank locally, not because I frequently visit the branches, but because I wanted to ensure that my bank’s Community Reinvestment Act (CRA) activities were benefitting my local community (CRA encourages “depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods, consistent with safe and sound operations.” Click here to search CRA performance ratings for specific banks or states); and
  • I wanted to be able to view my account activity and balances, pay bills, and view cancelled checks online.

After a bit of research, I moved my checking account to New Resource Bank, which is based in San Francisco. Mark Finser, who is Chair of the Board of RSF, is also Chair of the Board of NRB, and RSF was an early investor in the bank. I had also worked with the bank’s Initial Founder & Vice Chairman Peter Liu on several projects related to sustainable agriculture through Roots of Change, so the personal connection was well covered. Best of all, when I call “customer service,” I talk to Jennie, who helped me open my account two years ago and always remembers who I am!

As far as their lending goes, according to Peter Liu, “We have been active lenders in the areas of clean energy, green buildings, and green consumer products.  We also make classic local community banking loans and work with our borrowers to help them find ways to green their building or operations.  We also use our specialized knowledge for tailored or innovative products to finance solar systems or sustainable foods companies.”

Regarding my savings, I was deeply inspired by the composition of the RSF Donor Advised Funds’ Liquidity Portfolio (see Taryn Goodman’s recent post), and had initially hoped to mirror that. Unfortunately, as an individual with limited capacity to manage such a complicated portfolio, I soon realized I’d be better off finding one financial institution to steward my cash, based on the following:

  • Because I had chosen a bank for my checking account, I wanted to join a credit union (credit unions are member-owned and non-profit, and both these features score high on my values meter), and preferably one that defined “community banking” in terms beyond just banking in the local community – ie, one that also addressed ecological issues.
  • Assuming I could find such a credit union, I wanted to find a more simple solution to laddering CDs that would help maximize my interest rate, while minimizing the amount of work I had to do to keep track of what was happening.  Plus, I wanted to leave room for liquidity in the event that I miraculously found a home to buy.

And so I recently opened an Emergency Share Fund Account at the Permaculture Credit Union in Santa Fe, an investee of the RSF Donor Advised Funds’ Liquidity portfolio (as is New Resource Bank), in addition to having a close lending relationship with the RSF Social Investment Fund. Many of their loans offer discounted rates for sustainable projects and most of their mortgage and property loans have what they call “sustainability features” (ie, solar panels and water heaters, composting toilets, rain catchment, solar water heaters, roofing materials that reflect sun in summer and keep the heat in during the winter, etc). Personally, I am most excited about the fact that they can offer loans for off-the-grid buildings that don’t qualify for conventional mortgages. The type of account that I opened was perfect for my needs: because the funds are parked there indefinitely, I get a higher interest rate, but I can take them out in case of an “emergency” such as a home purchase, major life change, etc. Whenever I’ve called, Eileen and Don have been incredibly helpful and responsive – far beyond my expectations!

Now, I’m no investment advisor, and I imagine that if I had one, they would likely caution me against much of the approach I’ve outlined here… I find that I tend to have priorities that are very hard for many traditional investment advisors (or elders within my own family) to understand. Which is why I feel so grateful to be part of the RSF community, where we can dig into difficult questions like: what is true wealth? How can we redefine a portfolio theory that has values at its very heart? In short, how can we transform the way the world works with money?

*(RSF grantee Green America keeps tabs on the track records and policies of the big banks here. For more information on how banks are contributing to climate change, check out the “Banks, Climate Change, and the New Coal Rush” report from RSF grantee Rainforest Action Network, which was published as part of their global finance campaign.)

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

Ag 2.0 Presents the Spectrum of Sustainable Ag Investing

February 8, 2010

By Elizabeth Ü

As part of our mission to transform the way the world works with money, RSF engages with a wide variety of organizations to develop programming for their conferences related to social finance and our three focus areas: Food & Agriculture, Education & the Arts, and Ecological Stewardship. Here is a peek into the behind-the-scenes process as it relates to a couple of sustainable agriculture events coming up this March: Celebrating Community Capital and Agriculture 2.0.

The first Agriculture 2.0 conference took place last September in New York City. In just a few short months, organizer Janine Yorio of NewSeed Advisors pulled together one of the only conferences specifically focused on investing in sustainable agriculture. We at RSF were excited to see another conference with this focus coming on the heels of the Slow Money Inaugural National Conference, which RSF supported through sponsorship the week before in Santa Fe, NM.

So we were thrilled that another organization, and Janine personally, was stepping in to highlight sustainable food and agriculture investing, particularly to a wider audience of institutional investors that has not traditionally considered this sector as worthy of attention.  We did have a few concerns about the focus on the potential for high returns, especially if such high returns necessitate securing significant ownership of small companies and encouraging rapid growth. In particular, what challenges might the venture capital model introduce for the social entrepreneurs seeking capital? (See this post on the limitations of various financing options, which prompted the launch of the RSF Mezzanine Fund.) What about keeping ownership within the local community? How does the pursuit of rapid growth and scale affect a company’s ability to keep the values baked into a business model? (See my post on “Social Enterprise, Exits, and Liquidity Events.”)

Unfortunately, with a board meeting scheduled at the same time, we were unable to attend the initial Ag 2.0 conference ourselves, though we were encouraged by the number of people who did attend, and have stayed in contact with Janine. When she announced plans for another Ag 2.0 in northern California this spring, I agreed to serve on the planning committee. This meant I got a sneak peek at an early version of the program, and was able to make some suggestions for additional speakers (one being the addition of RSF CEO Don Shaffer to the “Bringing Money to the Table” panel as a representative of the field of lending).

A few weeks later, RSF joined as a conference sponsor.  We were excited to provide something to balance out the presence of some “Big Ag” and “Big Money” speakers in the lineup. Thus, we set to work to create a pre-conference event of our own to take place the night before Ag 2.0, in honor of the more community-oriented solutions to financing social enterprise that RSF is so committed to supporting. The event is called Celebrating Community Capital, and it features a stellar panel of pioneers in this space, not to mention local, organic, and seasonal food and beverages, and plenty of time for engaging informally with the speakers and attendees.

So! We are proud to invite you to this set of events in March, which we believe will, in aggregate, give foundations, individual, and institutional investors a complete view of the range of options available for investing in food systems that can restore our physical spaces, enliven our communities, and support local living economies.

Please join us at Celebrating Community Capital on the evening of March 23rd in Atherton, CA (near Palo Alto), and at Agriculture 2.0 the next day. We look forward to meeting you there!

Click here to sign up for Celebrating Community Capital, and click here to learn more and sign up for Agriculture 2.0.

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

Considered Compassion: Giving to Haiti

January 22, 2010

By Elizabeth Ü

When a crisis hits, one’s desire to respond in relief of the suffering of fellow human beings is often quite clear, but the path to an appropriate response can be a lot muddier. Choosing a few criteria to guide your decision-making process can help prevent either Donor’s Remorse or Analysis Paralysis while ensuring that your much-needed aid reaches the area that needs it as quickly as possible.

How many appeals have you received since last Tuesday’s devastating earthquake in Haiti from organizations asking you to support their relief efforts? Should we: Respond to the first ones that reach the inbox? Give only to organizations with names we recognize? Personally research which organizations have the lowest overhead, or the most experience in the country in question?

If these and other questions sound familiar, try replacing the “Should we…” above with “Would it feel right to me to…” and see if that changes the tone of the inquiry for you. (For an interesting examination of the dangers of the word “should,” see Marshall B. Rosenberg’s excellent book, Nonviolent Communication: A Language of Life.)

The first email I received with specific suggestions about where to donate came from Grantmakers Without Borders (GWB) via several contacts. Though I recognized the names of several of the organizations they recommended, I was most struck by the thoughtful criteria they used to compile their list, including their transparency in listing those criteria.

Knowing that I tend to overanalyze giving decisions, I encouraged myself to act quickly, even if it made me uncomfortable. I also challenged myself to give more than I felt comfortable, reminding myself that, ultimately, comfort is a privilege (and in this case a choice) that I have to make, and that the earthquake survivors did not. I personally chose to give to a handful of different organizations, which I narrowed down based on the following, in chronological order:

  • Because it was the first thing I had to read and digest, I started by checking out the organizations Grantmakers Without Borders suggested.
  • I have several friends who were actively involved in responding to the crises following Hurricanes Katrina and Rita, and have been committed to social justice while rebuilding that part of the Southern U.S. ever since. What do they recommend? (On Facebook, friends have been buzzing with specific suggestions – and critiques – so this part was easy.)
  • RSF has an active community of donors. Which organizations have they supported via RSF Donor Advised Funds?
  • Which organizations has RSF itself supported through Seed Fund grants?
  • The 21st Century Foundation (an organization whose mission is “to lead, innovate and influence giving for black community change” and whose Gulf Coast Organizing, Advocacy and Leadership initiative I have supported since Katrina), sent an email with more suggestions based on specific criteria gleaned from their experience, so I cross-referenced those with the ones above.
  • My friend Ruth Bender happened to be visiting Haiti when the earthquake struck, and was stuck there through Saturday; she had been reporting from Haiti and you may have seen her on CNN. What does she suggest?

Grantmakers Without Borders’ initial list included three organizations that donor advisors in the RSF community have supported: Madre, Grassroots International, and Partners in Health.  I’ve also been hearing about the Lambi Fund of Haiti (also recommended by GWB).  All four of these organizations appeared in the 21st Century Foundation’s list of suggestions.

And finally, my friend Ruth suggested Inveneo, an organization that is bringing internet connectivity to NGO’s in Haiti. This seems fitting, given that the only reason we have been able to learn anything about Ruth’s condition is because she’s had internet access the whole time!

This is just one personal example of the process of deciding how to respond in a time of need; it’s by no means the only way to come up with a plan. Caitlyn Kowalczyk, of RSF Philanthropic Services, also mentions these organizations that have received grants from RSF: MercyCorps (recent RSF Seed Fund grantee), Oxfam,  Doctors Without Borders, and the Global Fund for Women (which all were also included in the 21st Century Foundation’s list), plus the International Rescue Committee.

Which organizations have you chosen to support, and why? Do you have specific criteria that you find useful in deciding where and how to give? Have you found other resources that have helped guide you in your process? Please comment below so we can all learn from each other as we support the people of Haiti!

Meanwhile, if you would like to recommend grants to any non-profit organization by opening an RSF Donor Advised Fund, please contact Kelley Buhles at or 415.561.6152.

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

Digging Deeper on Moving Your Money

January 19, 2010

By Elizabeth Ü

I’m VERY excited about the buzz that the “Move Your Money” campaign is creating. I hope that people will take the sense of empowerment they feel from moving their checking and savings accounts to smaller, local banks and credit unions and apply the same concept to the full breadth of their economic lives.

(If this video, which takes its inspiration from the movie It’s A Wonderful Life, hasn’t found its way into your inbox or onto your Facebook wall yet, you can watch it here:; for further reading, the Huffington Post has an entire page dedicated to tracking various media and personal responses that have ensued.)

At RSF, we have been writing about similar issues – and suggesting that people move their money in a variety of different ways  – for a long time now; see in particular these three articles by president & CEO Don Shaffer: “Banks for the New Economy” from 12/29/08, “A Dialogue on the Banking Crisis” from 5/25/09; and “It’s Happening Right Now” from 8/3/09.

In order to determine just how many ways each of us can Move Our Money, we need to discover the full range of our economic selves; only then can we begin to identify the actions we can take to address each aspect. How does money come into our lives? Where is it coming from? Once it comes in, where does it accumulate? How does it go back out? Where does it go? How would we even begin to start mapping it out?


I first encountered the following exercise at the Making Money Make Change conference in 2008. “Draw your economic flow diagram” was the instruction. Take a blank piece of paper, preferably unlined. Use arrows to indicate direction of the flow of money into and out of your life. Use boxes to represent the various accounts, institutions and/or properties where your money accumulates. Stick figures can represent yourself and the many other people that are also part of a person’s overall economic picture. I thought it would be easy, especially since I had my tax return in my hand.

But the process of physically mapping everything out on a page humbled me, and it was much more difficult than I initially imagined. My flow diagram (I wish I still had it!) very quickly became too complicated to fit on the 5” x 8” piece of journal paper I was using, and so I got a bigger piece and started over.

How does money come into my life? The biggest ongoing source is my paycheck from RSF, so I drew one box and one arrow to represent the flow of dollars toward me. Then I remembered that because I’m a Food & Society Fellow, RSF receives some money from the Institute for Agriculture & Trade Policy to offset my salary… which in turn is supported by several other organizations like the Woodcock Foundation and the W.K. Kellogg Foundation; I added more boxes and arrows behind the box representing RSF.

To further complicate my economic picture, I invest in the RSF Social Investment Fund, which I contribute to monthly… and this account continues to add to itself as I’ve chosen to re-invest the interest. The same auto-accumulation picture is true of the many investment accounts I hold at various institutions, from investment banks to credit unions to plain old banks. I added more boxes to represent my various bank accounts (checking and savings) and CDs, with more accumulation arrows flowing in and out of the same boxes. This was the point at which I realized I needed another piece of paper to include various retirement accounts, mutual funds, and rental income.


The bulk of the money that flows away from me supports my cost of living: rent, food, clothing, fun. While there are plenty of ways to ensure that your spending aligns with your values, this wasn’t the point of the exercise, so I left it at that.

I also give money away, usually directly to the organizations I support, but sometimes through an RSF Donor Advised Fund. Then there’s my student loan (money which flowed toward me at some point = more back-and-forth arrows!), of which I pay back a portion every month.

I also pay fees on many of my investment accounts, so I added more arrows to that part of my chart, and I pay for professional services that are directly related to my economic situation (an accountant to do my taxes, and a property manager), so I drew them in, too.


Even if you don’t consider yourself the drawing type (I don’t), I highly recommend pushing through any initial discomfort and putting your own economic picture to paper, if only for the awe-inspiring experience of seeing it all laid out visually. I did find that in terms of prioritizing action, it helped me to take stock of the various accounts (bank, retirement, investment, etc) and other areas of accumulation in my life in list form, and so I introduced this add-on exercise at the 2009 Making Money Make Change conference:

For each account or asset, ask the following questions:

  1. What is it exactly, and where? (I was very specific: it’s a savings account at x bank, a Roth IRA account at y brokerage, a 6 month CD at z credit union, an apartment building in San Francisco, etc.)
  2. What is its dollar value? (If you don’t know, note that.)
  3. Who else is involved in the decision-making? (In other words, if you wanted to make any changes, is there anyone else you would need to talk to?)
  4. On a scale of 0-10, how well do you understand what is going on? (0 meaning “I have no idea what’s going on” and 10 meaning “I know every last detail”)
  5. On a scale of 0-10, how well does it align with your values? (Note: this will be hard to answer if you aren’t sure what your values are, or what is going on with this part of your economic story!)

Once I had done this for most of my accounts and assets, a few things became obvious: I had too many retirement accounts, which clashed with my desire for simplicity, so I vowed to consolidate. I had too many accounts at big banks, which violated my passionate support of small, local, and social-impact oriented organizations, so I vowed to move them. As far as the many mysteries that showed up in my list, I vowed to get to the bottom of them so I could see whether or not I felt comfortable about where my fees and investments were going.

It’s been an interesting journey. I’ve made some great changes, put off making others, and learned a great deal in the process. In the coming months I’m going to share what I’ve learned, and hope that you will both be inspired, and inspire me to continue Moving Money!

Read more about the Elizabeth’s personal experience of moving her money.

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

Making Money Make Change

October 12, 2009

By Elizabeth Ü

MMMCThere are two types of projects that wake me up in the night: the first kind, usually related to deadlines I’m sure I’m going to miss, keeps me up with worry. The second kind wakes me up with exciting ideas that just can’t wait until morning. A project firmly in the latter category is a conference session I’m helping to plan (working title: SRI, ESG, Impact Investing: Whatever You Call It, You Can Activate Your Portfolio for Social Change) for the Making Money Make Change (MMMC) conference.

Taking place November 12-15 in Falls Village, CT, MMMC is a national, multiracial gathering (hosted by Funding Exchange, Resource Generation, Third Wave Foundation, and Tides Foundation) for young people with wealth (ages 18-35) who believe in social change.  MMMC is a confidential space to explore issues related to wealth, privilege, philanthropy, and participation in grassroots movements for justice and equality. Through workshops, discussions, and community-building activities, my fellow participants and I will support, challenge, and inspire each other to align our resources with our values and work for personal and societal transformation.

At this conference, we ask each other hard questions, offer support, and challenge each other to take the next steps in our individual paths, whether that be drafting a giving plan, scheduling a meeting with a financial advisor to find out how exactly our money is invested, or meeting with a sibling to discuss how to go about fostering a healthier conversation pattern around money with a parent.

When I attended MMMC last year, I was thoroughly impressed with the giving-related sessions, but it seemed to me that the investing session was both a little overwhelming for those of us just beginning to explore our options, and a little flat for those of us ready for the most innovative approaches. So I volunteered to be part of the planning process this year to help craft a format for the investing sessions that will inspire young people at various stages of their investing journey. We’re inviting several wealth managers and impact investing experts to help provide solutions to common challenges that many of us encounter along the way.

Of all the social change oriented conferences I attend, MMMC is the most difficult – and rewarding – for me personally. I attend as a constituent, rather than as a representative of RSF, to explore, in community with others, the responsibilities that my own privilege and financial wealth warrants… though the distinction between “myself” and my role as an employee at RSF is a tricky one.

What is the connection between one’s personal relationship with money, and the work we do as an organization that works to transform the way the world works with money? You might think, “Sure, it makes sense that someone who works at a nonprofit financial institution like RSF should delve into her own money issues.” But which came first? Perhaps RSF exists because people like me need a place to gather – as staff, investors, donors, partners, and/or social entrepreneurs – to ask hard questions of ourselves and each other about how we view money in our lives… and beyond that, to actually conduct financial transactions in a different way – one that offers opportunities for social and spiritual renewal.

While our office isn’t big enough to invite all our constituents to the staff meetings in which we discuss our relationships to money, we are proud to host a variety of other small convenings (including the recent pricing meetings and RSF borrower gathering), in addition to participating in several larger conferences (as speakers, facilitators, sponsors, or members of planning committees). We will continue to invite you to join us at these (such as the upcoming Economics of Peace conference), and I also hope that more opportunities will arise for people to gather and collectively explore their own habits and beliefs around money.  For those of you between the ages of 18-35, I hope you will consider attending Making Money Make Change with me later this year!

To register for MMMC, click here.

Elizabeth Ü is Strategic Development Manager at RSF Social Finance.

Social Enterprise, Exits, and Liquidity Events

September 7, 2009

By Elizabeth Ü

True Confession: while studying toward my MBA in Sustainable Management, I was baffled by the concept of an “exit plan.” I just couldn’t understand why a social entrepreneur – especially one who poured her heart and soul into building a mission-driven business – would ever want to leave that business in the hands of others… others who probably did not share her passion, commitment or values.  Wouldn’t the founder’s exit lead to a dilution of those values?

Since then, I’ve gained a better understanding of the need for exit plans. Of course there are several reasons why a social entrepreneur might want to move on from a company she birthed and nourished: she might be ready to retire or turn her energy toward other projects. She may be called to take care of herself (or family) in the event of illness. Or perhaps the founder is truly an entrepreneur at heart, and navigating the waters of a mature business just isn’t as exciting to her as starting up a brand new social enterprise.

In order for there to be enough cash on hand to repay the exiting founder for her investment in the business, a succession plan requires some kind of liquidity event. If there are outside equity investors involved, the liquidity event is when they would see their return as well. (See Terri Spath’s recent blog post:, which outlines the benefits and drawbacks of traditional loans and equity financing, and what RSF is doing to offer alternatives.)

Historically, a social entrepreneur has had two choices with regard to liquidity events: 1) Offer up the business for sale to another business (in this transaction, known as an acquisition, the purchaser provides the liquidity), or 2) raise cash through a public offering (also known as the IPO, or Initial Public Offering).

Both of these events can be problematic when it comes to maintaining the values of a mission-driven business. There’s no guarantee that the acquiring company will honor the environmental or social practices of the original social enterprise; there’s also the possibility that the smaller company’s offices may be shut down altogether, with any remaining jobs moving to the acquirer’s headquarters. In the case of taking the company public… well, suddenly there are quite a few shareholders who can exert their voting power in whichever direction they please.

Whether you believe that the sale of Odwalla, Ben & Jerry’s, Stonyfield, Tom’s of Maine, or Burt’s Bees to much, much larger — and in some cases, multi-national — corporations has had a positive or negative effect on the social responsibility of the acquired (or acquiring!) companies, we consider it part of our mission at RSF to champion new and meaningful options for community ownership, wealth creation, and social impact. Here are a few examples for social entrepreneurs seeking alternatives to the usual exit or liquidity events:

One option is to transfer ownership of the social enterprise to its employees, rather than to another company or to the public. When employees have played key roles in developing and implementing the company’s social mission, they can be well-positioned to steward that mission over time; there are also tax benefits to this plan. (For more information about employee stock ownership, read this article by Esther Park, RSF’s Director of Lending:

Another promising model is that of Upstream 21, which is essentially a holding company for small, independently owned companies with products or services designed to benefit their employees, communities and environment. Upstream 21 does more than just talk about values; its founders have written them directly into its corporate charter, mandating that the “best interests” of the company include consideration of employees, the environment, and both the short- and long-term interest of customers, suppliers, and the communities in which the company and all subsidiaries operate. In other words, the risk of mission dilution usually associated with acquisition is extremely low! Focusing within the Pacific Northwest, this is an example of a truly place-based approach.

If you’d like to learn more about the truly innovative work of Upstream 21, visit their website ( and watch this video featuring Upstream 21’s chair (and member of RSF’s investment advisory committee) Leslie Christian, from last year’s Summit on the Future of the Corporation.

Finally, it should come as no surprise that Judy Wicks, chair and co-founder of the Business Alliance for Local Living Economies and inspiration to countless social entrepreneurs, blazed a new path when she decided to transition leadership of her iconic White Dog Café in Philadelphia. Rather than sell the business outright, she drafted a detailed social contract for the new owner. She also retained ownership of the name White Dog Café, which she licenses to the new owner. If the social contract (which details operational standards such as the procurement of local ingredients and equitable pay scales, and requires ongoing leadership in socially responsible business practices) is breached, she can revoke the license. A passionate advocate for all things local, Wicks of course drafted the contract to stipulate local ownership of the Café. (Read more in this article, written after Judy spoke at the Investors’ Circle conference last spring.)

If you have experience with either traditional exit plans and liquidity events or their alternatives, we’d love to hear your stories in the comments section below.

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

Sustainable and Local Food Investing Resources

July 27, 2009

By Elizabeth Ü

I frequently field requests from individuals, foundations, and institutional investors seeking investment opportunities in sustainable and/or local food systems. One of the best ways to learn about specific companies seeking capital in this growing field is through participation in investor networks that are active in this area. Below is information on several of the most prominent networks plus a few investment funds as you start your own explorations in this growing field.

Investors’ Circle (IC) is the oldest and largest national network of angel investors focusing solely on companies and small funds addressing environmental and social issues. This group’s national conferences have featured plenary panels, speakers, and workshops on the topic of investing in food and organics for the last five years, and they have helped connect investors with sustainable ag-related enterprises for longer than that.  IC’s 2009 Fall Conference and Venture Fair will take place November 15-17 in Washington, DC.   In addition to food- and ag-related businesses, they also consider companies in the areas of Energy & Environmental Solutions, Natural Products, Education & Media, Health & Wellness, and Community & International Development.

If you’re a social entrepreneur seeking capital in these areas, see if you meet the Investors’ Circle criteria and submit an application to have your executive summary circulated amongst their membership of individual and institutional investors; apply by July 31st to be considered as a presenter for the November Venture Fair.

Golden Seeds Angel Investor Forum is a woman-friendly investor group that provides early stage and growth capital to women entrepreneurs across all sectors. Though they do not have a specific focus on social enterprise, they do consider sustainable food companies, and to date  have invested in two such companies, Sweetriot and Dancing Deer Baking Co. (also an RSF borrower).

Several triple-bottom-line institutional equity funds, such as Greenmont Capital and TBL Capital, include sustainable ag-related ventures (primarily food) in their portfolios. The RSF Mezzanine Fund is the only debt fund designed specifically for social enterprises seeking a growth capital alternative or complement to selling equity; to date, all the investments from this fund have been to companies that are helping build a sustainable food economy.

Finally, a new entry to the space to keep an eye on is New Seed Advisors. They will be hosting a conference, Agriculture 2.0, on September 17 in New York City, and we’re looking forward to learning more about their approach and philosophy.

One thing to note is that the networks and funds mentioned above are designed primarily for accredited investors, which means that they are not appropriate for a large number of people who would nonetheless like to use their investments to support sustainable and local food systems. We are very proud of the fact that the RSF Social Investment Fund is open to anyone, regardless of income or assets. Over 20% of this particular fund is currently loaned to sustainable agriculture companies; the rest of the loans are to nonprofits and for-profit social enterprises in the areas of Education & the Arts and Ecological Stewardship.

It also bears noting that the investment networks and opportunities above relate primarily to companies that are beyond the start-up phase. Ideally, the company receiving the investment is profitable (or nearly so), has revenues of $1mm or more, and has the capacity to “scale,” or grow at a significant rate.

“Wait a minute,” you might be thinking, “many of the companies that make up a sustainable, local food system do not intend to go national.” Or maybe the entrepreneurs do not want to take capital from investors that do not live in the local area, or maybe the companies are brand new, having sprung up recently in response to the specific needs of their communities. And it’s true, the traditional capital markets have had a hard time responding to the needs of many food and agriculture companies that are approaching things on a community scale or grassroots level.

Here’s where the Slow Money Alliance comes in. A project originally incubated at Investors’ Circle, the Slow Money Alliance is a network of investors, donors, farmers, and activists committed to building local food economies. In recent years, this group has hosted several local institutes around the country, convening sustainable agriculture investors, entrepreneurs, and other stakeholders to discuss the unique challenges and opportunities in investing locally, with a focus on food; the name of the group is a nod to the international Slow Food movement. Slow Money’s inaugural National Gathering, From the Ground Up, will take place September 10-11 in Santa Fe, New Mexico. For more in-depth exploration, Slow Money chairman and president, Woody Tasch, recently wrote an excellent book entitled Inquiries into the Nature of Slow Money: Investing as if Food, Farms and Fertility Mattered.

I hope you find these resources useful, and encourage you to share others using the comments section below.

Elizabeth Ü is Manager of Strategic Development at RSF Social Finance.

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