Blog

RSF to host 3rd Shared Gifting Circle in Philadelphia

August 28, 2014

RSF is excited to announce that we will host our third Shared Gifting circle working with organizations focused on building socially and ecologically sustainable regional food systems in Philadelphia.

The participants, listed below, were nominated by RSF’s community of grantees, borrowers, investors, and donors. We also worked closely with RSF borrowers Fair Food and Common Market, to help identify non-profits doing great work in the city.

Shared Gifting is a new model of grantmaking that RSF has been experimenting with for the past four years. This model gives ownership and allocation authority for gift money to the participants of the circle and shifts the power dynamic inherent in traditional philanthropy by giving grantees decision making authority. We have found that this process creates opportunities for grantees to collaborate, leverages community wisdom, and creates accountability among the participants.

One representative from each organization will meet in Philadelphia on September 16th to share proposals with each other and determine how to distribute grant funds in support of each other’s work.

The Philadelphia participants are:

We are really excited to be working with all of these wonderful organizations and look forward to sharing our experiences from the Shared Gifting meeting!

Announcing RSF’s 2013 Annual Report

August 27, 2014

AR cover

Photo credit: Paige Green Photography

We are excited to announce the publication of our 2013 Annual Report. This year we wanted to share a deeper picture of what our community looks like by taking a closer look at the investors, donors, and social entrepreneurs that make RSF’s work possible. Hear clients reflect on how they are transforming the way they work with money; catch up on highlights from our lending, investing, and giving programs; and meet the people who drive our work forward.

We hope you enjoy the new digital format for our annual report. We’d love to hear your feedback!

Click here to view the report

What Would Nature Do? – Part II

August 26, 2014

This article was originally published in the Summer 2014 RSF Quarterly.

Click here for Part I

KatherineCollins#1CREDITMiranda Loudby Katherine Collins

As an investor, I have similar questions. What if some of my investments have non-dollar-based paybacks? What if I had as much information about real environmental outcomes and the value they represent, as I do about security prices? How could I create an investment portfolio where growth is a result of strong development and real value created in the world, not an aim in and of itself? Like many investors, I’m moving through the spectrum of these “what if” scenarios, though the answers are not simple, and are ever-evolving.

Another principle of biomimicry is to adapt to changing conditions: natural systems thrive in context, demonstrating flexibility over different spans of time and across different operating conditions. Here again, there is helpful wisdom for a small ranch owner. Which expenses (whether time, money, or other resources) are seasonal in nature? Which might grow or shrink over time as the work progresses, with healthier land and changing herds? Choosing a static, one-size-fits-all financial tool (like a lump-sum conventional loan) would leave big gaps in different seasons and different circumstances; clearly something more adaptable (like a line of credit, or a series of smaller financial supports) might be a better match.

Again, as an investor, this concept of adaptability raises parallel questions. How can I embrace an adaptable investment approach, without feeling a constant sense of churning? How can I consider my own changing context, as my life, family, and community continue to evolve?

Alignment with the principles of natural systems is a serious and vital challenge for investors and investees alike. But, underneath all of the discussions of structure and mechanics there is a deeper layer of alignment that is essential. When we look to nature as model, mentor, measure, and muse, we first need to reconnect our own lives to the natural world around us. This reconnection is a simple idea, but not easy to implement, even for those of us who are deeply devoted to our natural environment. I believe that this deeper reconnection involves three central imperatives: reframe, refrain, and reclaim.

First, we need to reframe our own position with respect to the natural world. Humans are a delightful, unique, and relatively small part of the natural world, though our impact upon it might be outsized. Reorienting as citizens of the natural world, a small subset, rather than rulers of our environment, is essential.

Second, we need to refrain from our never-ending doing. To really learn from nature, we need to quiet our own cleverness. We need to sit in stillness and to observe without desperately seeking immediate answers or insights, just as is practiced in many contemplative practices. For those of us who have been trained since birth to be as quick and clever as humanly possible, this can be an uphill battle – but it is a worthy and necessary endeavor.

Once those first two conditions are met, we have the chance to reclaim. To realign investing with the real world, the world it was originally intended to serve. To develop new approaches that match multi-dimensional, relational, long-term goals. To seek true profit, fair profit, rather than a fleeting positive number on today’s trading reports. To practice investing as vocation, as profession – not just a business.

Nature is not just a place to escape our professional lives; it is the source of deep wisdom that can improve our designs and decision-making. With biomimicry-based approaches, we need not choose between environmental and financial stewardship. Both are part of a healthy investing ecosystem, and both can be supported through life’s principles.   This is investing in its most fundamental form: resilient, regenerative, and reconnected. This is the true nature of investing.

Katherine Collins is author of The Nature of Investing: Resilient Investment Strategies Through Biomimicry. She is also Founder and CEO of Honeybee Capital, a research firm dedicated to the pursuit of optimal investment decision-making. Katherine has previously served in numerous capacities at Fidelity Management and Research Company. After a career in traditional equity management, she set out to re-integrate her investment philosophy with the broader world, traveling as a pilgrim and volunteer, earning her MTS degree at Harvard Divinity School, and studying the natural world as guide for investing in a valuable and integrated way, beneficial to our communities and world.

What Would Nature Do? – Part I

August 22, 2014

This article was originally published in the Summer 2014 RSF Quarterly.

KatherineCollins#1CREDITMiranda Loudby Katherine Collins

Last year I had the pleasure of meeting an investment-seeking rancher, who enlightened me about the glories of ranch life. Turns out, like any valuable endeavor, ranching is full of joy and challenge, reward and risk, hard work and…more hard work. What this endeavor was not full of, at least not in the beginning, was cash flow. This is not a criticism: we discussed his long-term plans for sustainable – maybe even regenerative – ranching practices, and the tangible, trackable benefits to the soil, the broader ecosystem, and the surrounding community. In the early years, the returns from this work would be seen in the growth of microorganisms, the health of cattle, and the strengthening of community. Later on, as some of those benefits took hold, the path towards solid cash flow became visible and compelling.

Unfortunately, traditional bank financing for this ranch project (if available at all) would only recognize return of dollars – not return of nematodes, or grasslands, or community. And the bankers needed to see those dollars starting on day one — not because they were greedy or thoughtless, but because that is what their financial tools required. A plain old loan requires plain old repayments, simple as that. It’s as if we are trying to sculpt a glorious 3-D universe out of granite, using nothing but a surgeon’s scalpel. The scalpel might be a fine tool in other contexts, but it is no match for the task at hand.

Here we were faced with a central dilemma of sustainable finance: often the multidimensional, sustainable enterprises that we want to support are still constructed with the assumptions of linear, short term tools and mechanisms of finance. Due to this mismatch, it sometimes seems impossible to be a responsible environmental steward and a responsible financial steward simultaneously.

In situations like this ranching enterprise, we spend a lot of time thinking about ways to invest differently IN nature. What if we also considered ways to invest AS nature, matching form to function? What if our investment tools and processes included more elements that we see in healthy natural systems — options that are relational, adaptive, and long-term in orientation, instead of being transactional, rigid, and short-term?

Biomimicry can help to create the tools of regenerative finance. Nature has adapted and thrived for 3.8 billion years – the most compelling track record around. We can learn from the principles that guide these systems, and orient towards approaches that are robust and resilient. The six major principles of biomimicry established by Janine Benyus and Dayna Baumeister, Life’s Principles, aren’t just clever buzzwords. These concepts describe how the world around us actually functions.

Biomimicry asks us to pause before we create a product, reorganize a team, or allocate investments to ask, WWND? (What Would Nature Do?). This deceptively simple question leads to decisions that are effective instead of merely efficient, simple instead of synthetic, mindful instead of mechanical. Biomimicry aims to embrace nature’s wisdom, rather than harvesting nature’s stuff.

For example, one of life’s principles is to integrate development with growth, much as a tree develops root structure in sync with its expanding canopy. For my rancher friend, this idea leads to some interesting questions about forms of investment and types of investors. What if in the early years the rancher could start with a small pool of funding from friends and family, who would be just as happy to be paid in grass-fed beef as in dollars? Later on, when cash flow improved, they could take on more traditional loans if needed, with the confidence that dollar-based resources would be available for repayments.

Click here for Part II

Katherine Collins is author of The Nature of Investing: Resilient Investment Strategies Through Biomimicry. She is also Founder and CEO of Honeybee Capital, a research firm dedicated to the pursuit of optimal investment decision-making. Katherine has previously served in numerous capacities at Fidelity Management and Research Company. After a career in traditional equity management, she set out to re-integrate her investment philosophy with the broader world, traveling as a pilgrim and volunteer, earning her MTS degree at Harvard Divinity School, and studying the natural world as guide for investing in a valuable and integrated way, beneficial to our communities and world.

RSF in the Wall Street Journal

August 20, 2014

|||

Dear Friends,

The RSF Social Investment Fund was recommended in the Wall Street Journal for the first time last Saturday, August 16, in an article titled “The Payoffs of Investing Locally.”

We’re thrilled to get such prominent coverage, and I have one brief clarification:

In the article, the journalist wrote, “returns are often lower than other fixed-income investments.” I want to address this statement.

Working directly with our investors over the past seven years, I have observed two primary reasons why they choose the RSF Social Investment Fund:

  1. They want to support inspiring social entrepreneurs.
  2. They want a low-volatility, liquid investment that has minimal downside risk.

Regarding #1, we have a track record of finding great social enterprises to support, often before a commercial bank will step in.

Regarding #2, we have a 100% repayment rate (principal + interest) to our investors since RSF was founded in 1984.

The investment is structured as a 90-day note, similar to a bank certificate-of-deposit (CD). Because of the liquidity and the low-risk profile, investors should consider the RSF Social Investment Fund as a part of their cash/savings asset allocation, not their fixed-income allocation. This is the critical point.

The Wall Street Journal writer correctly observes that the average return on our 90-day note over the past year has been 0.53%. This is two times the average financial return of bank CD’s with similar duration, according to Bankrate.com.

And with a big-bank CD, you have no idea where your money is being invested. It may be going to support small-business loans in your community, or it may be going to support clear-cutting of rainforests in Malaysia through the bank’s proprietary trading operations.

Nowhere else but with RSF can you find a bank CD-like investment (in terms of high-liquidity and low-risk) in a diversified direct-loan portfolio of over 90 phenomenal social enterprises, with an institution that has been a pioneer and a leader in social finance for over 30 years, with a minimum investment of $1,000. You know exactly which social enterprises receive loans from us (see a list of all our borrowers here). And the financial returns are actually superior to any comparable-term savings account or CD at a bank!

Thank you for your attention and interest. Again, we certainly appreciate the great story in the Wall Street Journal.

All the best,

Don Shaffer

President & CEO

RSF Seeks Social Impact Fellows

August 13, 2014

In the spirit of building the field of social finance we are excited to announce a new fellowship opportunity for talented graduate students and professionals. We are eager to support the development of the next generation of inspiring leaders and to bring a fresh perspective to our business development activities.

RSF seeks exceptional, analytical, and entrepreneurial Social Impact Fellows to serve in an eight month Fellowship role. Open to graduate students and professionals within the US and Canada who are seeking a career in social finance, Social Impact Fellows identify, vet, and pitch promising social impact businesses and organizations to RSF for financing (senior-secured debt.) The Fellow is responsible for scanning and understanding the local, regional, and national landscape for high potential innovations, trends, and movements within RSF’s focus areas that emphasize the creation of social value and impact; sourcing for-profit and non-profit social enterprises that exhibit both financial sustainability and significant social impact; conducting preliminary due diligence including financial analysis and underwriting on live deals within RSF’s pipeline; and presenting the business case for investment to senior staff at RSF. Successful Fellows will gain a reputation for his/her strategic ability to spot and qualify ground-breaking and pioneering approaches to solving pressing social problems through business. The application deadline is September 18th.

This fellowship requires a 5 hours per week commitment through June 1, 2015.

Please visit our Jobs page to learn more or apply for this opportunity!

How Can We Fix Our Broken Food System? Start With the Base of the Supply Chain

August 7, 2014

Originally published on TriplePundit

Triple pundit food systemsby Don Shaffer

Social equity in the food supply chain was a strong thread running through the annual Sustainable Agriculture & Food Systems Funders forum this June in Denver. If we’re going to fix our broken food system so that it delivers healthy food to the whole population while enabling farmers to make a decent living, we’ll need new models and alternatives across the entire supply chain.

The most potentially transformative enterprises, however, often face the greatest funding hurdles. The forum’s theme, “Stronger Together,” reflects a growing recognition that collaborative funding strategies involving investors, foundations and communities are essential to getting these types of enterprises off the ground.

We know this approach can work. A growing number of social enterprises supported by what we call ‘integrated capital’ are successfully addressing problems related to food production, processing, aggregation and distribution in ways that contribute to social equity and agricultural sustainability. They’re flying under the media radar, but they’re worth examining as models for the field.

Real progress on tough challenges

Problems at the beginning of the supply chain — dwindling agricultural land, fewer farmers, lack of access to production facilities, and missing distribution links between metropolitan areas and their surrounding farms — are among the most difficult to solve. But several enterprises we’ve worked with in these areas have made real progress.

Viva Farms: Cultivating new farmers

In terms of food production, the biggest hurdles are affordable access to land near consumers and the need to encourage and train more people as farmers (the average age of farmers in the U.S. is 57). Viva Farms, an incubator program operating on 33 acres in Washington state’s Skagit Valley, addresses both issues, working with a mix of highly skilled migrant farm workers who have no access to land or capital and young, educated urbanites who have little agricultural experience. Viva Farms gives these new farmers training in sustainable farming practices, small land parcels with shared infrastructure and marketing support.

The goal is to transition the farmers from incubator to farm ownership with secure long-term prospects. Once farmers establish stable agricultural enterprises at the incubator, Viva Farms helps them relocate to new land and expand operations via a loan fund that provides affordable start-up and growth capital. Start-up costs for beginning farmers in the Valley can range from $30,000 to $500,000; with Viva Farms’ support, farmers’ costs drop to less than $5,000.

The program, launched in 2009, has provided training to about 250 people and launched 15 farm businesses that produce on more than 70 acres.

The primary challenges for the Viva Farms model are maintaining and expanding capital for land purchases and national immigration policy. Migrant farm workers who have the skills and desire to be the next generation of farmers often are hindered by their immigration status. Even if they personally have legal status, an immediate family member may not, and the ever-present possibility of deportation makes it difficult to invest for the long term.

Read the full article here

Don Shaffer is President & CEO at RSF Social Finance

Uncle Matt’s Organic Revolutionizes Florida’s Citrus Groves

July 31, 2014

With its subtropical climate and rich pest population, Florida has been slow to embrace the organic movement: fewer than 8,000 of its 541,328 acres of citrus groves are organic. Matt McLean has made it his mission to change that. As the founder and CEO of Uncle Matt’s Organic—the largest and oldest organic orange juice company in the U.S.—McLean not only sells delicious juices, he’s making it easy for other small Florida citrus growers to transition to organic.

noelle mcleanUncle Matt’s sells a huge quantity of organic orange and apple juices, lemonade and whole fruits to retailers such as Whole Foods and Publix each year. But its most innovative initiative is its agricultural management company. Uncle Matt’s Ag provides “one-stop shopping” for grove owners who want to go organic. The company actively recruits conventional farmers, handles all the paperwork for them throughout the transition and certification process, creates a full farm plan and oversees every aspect of caretaking, from riding the tractor to tamping down the weeds. Uncle Matt’s then markets all the grower’s fruit at top dollar, ensuring that organic farming is economically viable.

It’s a model that—with the help of a credit line from RSF—has fueled both consistent sales growth and positive changes in Florida agriculture.

Inspiration

McLean didn’t set out to be an organic grower. A fourth-generation Florida citrus grower, he grew up working in the groves, and escaped to college as soon as he could to get away from “manual labor in Florida’s summer heat.” After earning a business degree from the University of Florida, he started an import-export company, selling juice to companies in Europe. When one of his clients asked for biologic white grapefruit juice, he consulted his father and grandfather.

His grandfather, who had used organic methods in the past, insisted that “not only could we grow that way, we should be growing that way,” McLean says. “We are too focused on single-factor analysis—if you have a pest, then you’re told to find a pesticide. Instead, we should think holistically: why is that pest attracted and how can we help the trees’ immune systems defend against it through better soil and plant health? This is an organic farmer’s way of thinking.”

UMO

Innovation

McLean started Uncle Matt’s Organic in 1999 with just five acres. As the company grew, it needed more fruit, which meant it also needed more organic farms. But farmers were hesitant, even afraid, to go organic—despite the fact that prices for organic fruit are consistently higher—and McLean knew he had to make the process as easy as possible. Thus Uncle Matt’s Ag was born in 2002.

One of the biggest challenges in persuading grove owners to grow organically was—and is—the threat of citrus greening disease, or Huanglongbing (HLB), a bacterial infection spread by gnat-size psyllids that can wipe out groves. It hit Florida in 2005 and has killed millions of citrus plants in the southeastern U.S. While Uncle Matt’s groves have not fully escaped the disease, several groves have proved 100 percent resistant—an anomaly the University of Florida is studying. Uncle Matt’s Ag is experimenting with nourishing root and soil health to keep disease at bay, and unleashing parasitic wasps into groves to keep the psyllids’ population under control.

With its innovative approaches to grove management and increasing consumer demand for organics, Uncle Matt’s has grown continually. But like many food and beverage companies, Uncle Matt’s faces a cash flow gap between the time when it pays farmers for the harvest and when the juice hits grocery stores and starts generating a profit. By 2011, McLean needed more financing.

The company had a line of credit with a local community bank, “but it was post real-estate bubble in Florida, and the banks were very risk-averse,” he says. So Uncle Matt’s hired McLean’s friend Aubrey Hornsby, a manager of the Conscious Capital Fund, to help it find additional funding. “Aubrey introduced us to RSF in September 2011,” says McLean, “and at that point a lot of things came together.”

Several members of the RSF lending team visited Florida, where they toured the groves, packinghouse and storage facility and closely examined Uncle Matt’s business model. “They understood our business right away,” says McLean, “and they really had a passion for our space and our mission.”

Based on this, RSF provided a $1.2 million line of credit that Uncle Matt’s uses to finance the juice inventory from season to season—and keep growing.

Impact

For the past three years, Uncle Matt’s sales have grown 20 to 30 percent annually. The company has also introduced two new juice blends, orange-mango and orange-tangerine, and has expanded to new retailers including Safeway, Kroger, Fred Meyer and Walmart Neighborhood Markets.

But the greatest proof of success is in the groves: In the last 12 years, Uncle Matt’s has converted more than 1,500 acres in Florida’s Lake, Highlands and Polk counties to organic cultivation.

“I started Uncle Matt’s as a business challenge,” says McLean. “But my grandfather’s passion just kept me thinking, ‘Hey, this is a better way to farm and we need to be a leader.’”

6D9B2631

Interdependence in Ecological and Economic Systems

July 30, 2014

This CEO letter was originally published in the Summer 2014 RSF Quarterly.

Dear Friends,

The word economy comes from the Greek oikonomia, meaning household management. When thinking of our economy, now on a global scale, how should we define that household? Our current financial system (a subset of economic life) favors a narrow view focusing on the individual and more specifically, the individual with resources. But if we open our perspective, we can see that view expand—the household is our homes, our communities, and the planet that houses us all.

Indigenous wisdom has always been ahead of the dominant paradigm in this regard. Indigenous knowledge evolved from observation of and participation with the natural world. This wisdom holds that humankind meets needs by working with nature and honoring the earth and its systems. This approach recognizes something that has been lost in our economic life—the idea that all is interrelated. People and planet. Earth and economy. In the grand scheme of things, it doesn’t make sense to have a zero sum game in which some win (at the expense of others) and the rest lose.

Here is an example of the opposite: We recently made a grant to The Pollination Project, which makes $1,000 seed grants to individual change-makers. Grants to for-profit ventures are made as zero-interest pay-it-forward loans. Recipients are expected to pay loans back in 24 months, and payment is received in the form of a new loan to another qualified Pollination Project applicant, chosen by the original borrower. This pay-it-forward model is a practical example of working with money in a way that honors interdependence, community, and trust and that values mutual benefit—when one wins, so can all.

Interdependence and community are inherent to how we approach finance at RSF. We have a vested stake in the success of all our stakeholders and we recognize that success for all of us is contingent upon regenerating and preserving the earth’s ecosystems. Financing organizations that are a part of the regenerative cycle is also a part of regenerating the economy that holds the human being as the center. This is one more reflection of what it means to transform the way the world works with money.

All my best,

Don Shaffer

President & CEO

RSF Honored as ‘Best for Communities’ For Creating Most Positive Community Impact

July 24, 2014

This week, RSF Capital Management was recognized for creating the most positive community impact by the nonprofit B Lab with the release of the third annual ‘B Corp Best for Communities’ list. The ‘B Corp Best for Communities’ list honors 85 businesses that earned a community impact score in the top 10% of all Certified B Corporations of their size on the B Impact Assessment, a rigorous and comprehensive assessment of a company’s impact on its workers, community, and the environment. Honorees were recognized among micro, small, and mid-sized businesses.

Best for the World Community RSF

RSF Capital Management is a wholly owned subsidiary of RSF Social Finance and was formed in 2008 to manage all of RSF’s lending activity to for-profit social enterprises. RSF Capital Management provides senior working capital and subordinated term debt to businesses meeting a rigorous social enterprise profile.

Each honored company is a Certified B Corporation. They use the power of business to solve social and environmental problems and have met rigorous standards of social and environmental performance, accountability, and transparency. Today there are over 1045 certified B Corporations, across 60 industries and 34 countries, unified by one common goal: to redefine success in business.

The ‘Best for Communities’ companies come from over 35 different industries such as consulting, educational support services, retail and financial services. A quarter of honorees are based outside North America, with 25% of companies operating in emerging markets including Chile, the Republic of Korea and Kenya

Other honorees include d.light design, supplier of affordable, renewable energy to 30 million people in 60 countries, Greyston Bakery, which provides job opportunities regardless of work history through their open hiring policy, and Minnesota’s Sunrise Banks, which invests in projects to develop strong communities that provide homes and jobs to their residents.

Click here for full list of honorees

Blog

Page 1 of 3412345...102030...Last »

Categories

Latest posts

Archives

Blog Roll