 Please welcome the come-together right now catalyzing place-based impact investing ecosystem Panel. Oh, good afternoon. I'm Melanie Audette with Mission Investors Exchange I'm pleased to be with you today and want to congratulate SoCAP for its 10 years and it's great to see some familiar faces in the audience and to have this distinguished panel of speakers with me This morning at the plenary in this room We heard Laurie Spangler from the UK National Advisory Board Say that business as usual has not worked for folks and I would say that Philanthropy as usual has changed and is really beginning to work for folks And we're going to hear some real-life examples of how the work has evolved from what some people in the past has said is old crusty philanthropy Into real innovation in communities. We had a great launchpad from the last session It's not your grandpa's philanthropy and we're going to hear how this is playing out today in communities. Oh So first of all, how many in the room are foundations private foundations or community foundations Great. Wonderful to have you here What about Investees who have worked with foundations? Only a few. How about investees who would like to work with foundations? Great, we'll do some matchmaking after this So Mission Investors Exchange is a network of foundations and about 12 years ago There were just a few people Who came around the table wanting to know how to make their assets go Further and that has evolved over the last 12 years into a network that is has over 200 members all over the United States and what we're seeing now is Foundations working not just in historically what were silos, but really working more intentionally Cross-sector and with partners In order to make real change specifically in place There are sector-based groups as well, but you know thinking about community and the so-cap community for example When you think about an ecosystem, it really is a community and it's defined by those in it What we're talking about today is really based in research that Mission Investors Exchange Has done and is continuing to do to understand how these initiatives in place get started We're building out some models for that so that as communities want to do more of this work We'll have examples and tools that communities can use in order not just to Not just for philanthropy to look for investments, but really to be able to collate capital in communities with foundations playing a Role, but not the only role in community looking to the members of those communities and in our in our Research we've seen that there are two really important things in order to build an impact investing ecosystem one is that It's usually two or three Very dedicated people who have a passion for this work They can't do it alone. However And they can't do it without someone really dedicated to it long term that dedication Has to have support Financial support and support for other types of actors in the community in order to make real change. This isn't this is This isn't really collective It is it is a collective effort to make a real change in place and that's what we'll be talking about today so I want to introduce my panelists first of all is Susan Hamel and on the end and Susan Describes herself as a philosophy major who went to Wall Street Susan translates between passionate social change makers and expert accountants in Her role as CEO and founder of cogent consulting first she's based in the Twin Cities and She's a CEO there, but also has a second job and she's in her second year Serving as the Minnesota Council on Foundations executive-in-residence and That is a role that was funded by the Otto Brummer Trust and the Bush Foundation And this is a model that already is taking off and the key in our research is that National foundations now we're looking to regional efforts supporting them in Helping them to build ecosystems and that means building a community of investors a pipeline of investments Investees Networks like Mission Investors exchange gin and confluence tonic those kind of networks are really essential to bringing the community together as well as academic institutions and of course advisors and fund managers and Susan works with all of these different types of actors to build her ecosystem in the Twin Cities She'll tell us about that today Second next to me right here. We're gonna skip you Cynthia permanent is will towns Will is the executive director for benefit Chicago where he leads an organization in helping socially motivated businesses and nonprofits Access the capital they need to innovate and grow Previously will was at the University of Chicago Where he led the neighborhood initiatives team and its work to fuel economic growth better health outcomes for the south side Communities with high concentrations of poverty Prior to that will worked in the affordable housing in affordable housing issues related to families and communities at mercy portfolio services Thank you. Well, thank you And last Cynthia molar is with us from WK Kellogg Foundation where she's a program and portfolio officer She is part of the mission-driven investments team where she is responsible for managing impact investment activities that address systemic barriers That create vulnerable Communities for historical marginalized communities and children Her work includes sourcing and deploying market rate impact investments ongoing analysis of solutions and trends and I would add to that creation of solutions and forging trends Fostering alliances with community corporate government and philanthropic partners and more so welcome speakers I'm gonna start with Susan asking you a question that will help us with our definitions today In philanthropy our term the terminology has really evolved and now we're using the word impact investing and Quite a broad definition of impact investing in philanthropy so I want to ask you first Susan because you're one of the pioneers in building an ecosystem in a community what kind of Challenges or opportunities do you see in the definitions? Thank You Melanie. It's nothing like asking a philosophy major to define a term So I'll try not to go on and on I would say the term impact investing has has actually become a barrier in our ecosystem So we're just talking about investing because as a CFO at the Bush Foundation in St. Paul, Minnesota says every investment Has an impact Some good some bad same with grants Positive impact negative impact. They all have an impact. They're all investments Some of them have a financial return. Some of them don't have a financial return So we're actually starting to get away from the term impact investing and we're saying investing all your assets in a foundation your people your convening power and Your money invest that for the impact you're seeking in alignment with your mission Because otherwise we're finding that the term is dividing the community So some people will say I'm doing impact investing. He's not or we have a gender lens fund in Minnesota Called the Sophia fund that they don't consider themselves an impact investment fund. They're just smart investing Investing in women led enterprises So it's all about investing across the spectrum for both a financial and social return in alignment with your mission Well, I want to turn to you and ask you to describe a little bit more for the audience about benefit Chicago And I also want to ask you the question is benefit Chicago and ecosystem building effort in your mind Great, so that's that's a great question again. Thank you for having me here today And I'm happy to I think really getting to something that we discovered As we're trying to search to solve problems So so benefit Chicago really is about an effort to solve a problem in our communities, right? We know our communities in Chicago and others across across the country Have communities that just for the fact that there's a lack of capital inflows The communities can't grow and really create the impact and things that they're neat This isn't a lack of ingenuity or creativity or brilliance It's just a simple fact that for a number of reasons capital isn't flowing into our communities So we took that a particular problem and challenges sort of examine that the other part of the equation was that we also saw a trend in the Need or increase for individual investors to have a local impact, right? We saw that there was a growing group of individuals that were no longer happy with just investing in an Amazon and Apple and Exxon mobile and all these other companies But wanted to have some portion of their investments a closer tie to where they live And so benefit Chicago was born out of these two problems really one the lack of capital is flowing in our small social enterprises And in to these individuals who are looking to have a closer tie to their investment And so benefit Chicago really tried to bridge the gap between those two entities and provide a platform that allows individual investors Corporations and philanthropists to invest locally in in their communities. Now as a part of that We then have to look at creating segments in which the areas in which we would invest in and this is where I think the Ecosystem building comes in we have minimums of investments that will make so as an example Benefit Chicago's minimum investment is five hundred thousand dollars now We realized by setting a bar at five hundred thousand dollars You're leaving off a number of potential businesses where we work on building the ecosystem is we have the ability to invest in those intermediaries that fund those smaller amounts of the micro lenders the ones 250 to 500,000 and so we look to invest in them strengthen in their capacity to work with those smaller Segments in our community and businesses while we continue to work With those that meet our criteria the other way I think that we work on building an ecosystem is really expanding what you consider to be the ecosystem itself, right? So there's the lenders we also have our corporations that we work with and partner with our other philanthropists Foundations and such that we try to then bridge and make a connection so that the net is tight That doesn't allow anyone to slip through and so we often will get people who apply to us for funding As we find for whatever reason they don't meet our criteria We have agreements and partnerships with a number of other lenders and partners within the ecosystem and can refer the application To them allowing them to continue to sort of work through the system in order to sort of get the support and things that they need We also provide social capital with those borrowers that get that we're working with And intellectual capital as well So we try to look at the entire system in a way that allows us to have high tides race all ships In a system that allows them to get the capital they need The way that they need it and in a timely manner That's a great segue to my question for you Cynthia in the plenary this morning Patricia for our Riva said that we needed to expand the the investor The look of the investors on where investors investments are coming from and part of that she explained was Women as impact investors and people of color as impact investors and your work in racial healing at WK Kellogg Foundation And there's a whole equity Race equity and inclusion track here at SOCAP today Is really relevant in these conversations? I wanted to ask you To to to think about and help us to understand how Kellogg Foundation's work is Helping to redefine the community of investors. What does that mean to you and your work? I'm with the WK Kellogg Foundation where we Go to sleep and wake up every day focusing on children and we want to support children Particularly those that are vulnerable and to do this we have to look at systems There are a lot of pervasive issues in this country that affect how People get access to education how they access health care affordable housing Banking and so for us we think about systems in a really expansive way We have a we have kind of a two-prong strategy one is through programmatic sector So, you know the you know foundations like we're focused on education. We're focused on you know, you know Finance we we do that, but we also overlay that with our focus in Specific places, so we're in New Mexico, Michigan, Mississippi, New Orleans, Mexico and Haiti make a lot of sense, right? so but those are places where kids have the The most hurdles to overcome in terms of access to equitable education health care Financial services for themselves and their families But how we we how we are kind of coupling the programmatic work with our place work is really looking at National trends or even international trends and opportunities and best practices and how we apply them to our communities And then in the communities. We're actually really focusing on power and in control and having these communities Be more directive about how they're what resources they need how they're collecting their own data to You know how they actually access to capital markets And so I'm fortunate to be on a team where we are working really closely on The kind of impact investment side with our programming to figure out how do we how do we use capital? to empower communities so that benefit Chicago is one of my favorite Kind of place-based work along with Minnesota as well because we're starting to see this movement of Key players stakeholders communities really driving this capital And you know, we'll talk a little bit more about this later But it doesn't happen overnight and it really takes you know a lot of coordination But also a lot of empathy and understanding of the communities and the challenges that they're facing And that's something we try to bring to all of our places in our work We we are a foundation when we acknowledge that we you know, but we also Understand the only way that their communities that we most care about Are if they're too for some of the stand on their own is for them to have the power to do so and so we we really try and focus on making sure that the community is telling us how they want to show up and It may not be the most streamlined process, but it's definitely a process. We think will last much longer long after our funding goes away Well, I want to express thanks on behalf of the field to WK Kellogg Foundation for your work in supporting ecosystem building And there you have a commonality really with the other two ecosystem actors on the stage in that all three of our panelists Either our funders of ecosystem building efforts in the case of WK Kellogg have been funded through a regional association with the Minnesota Council on foundations with Susan's work and MacArthur Foundation What is the the funder and Launchpad the behind-benefit Chicago and that again is really critical to All of the emerging ecosystems that are being formed up around the United States is that it can't be done without that kind of support So we really express thanks to all of the foundations who have supported you and us Susan my first interaction with you was around the local host Committee of the our mission investors exchange its national conference in the Twin Cities about three years ago and at that time you were working with social entrepreneurs in Community and I'd love to for you to talk about the evolution of your ecosystem and how that Got started these have happened in various ways You know who are the leads who are the first in those dedicated individuals that I talked about give us a little bit of help On that evolution in Twin Cities for you. Thank you Melanie appreciate that question Well, we like to trace our investing for impact. We trace it back to 1520 to Martin Luther Since Minnesota's as you all know, it's filled with Lutherans. So we all we always have to pay homage to Many years ago and I like to bring that up because Investing in line with values is is not a new idea Yes, the term was coined ten years ago But this has been around for a long time and in Minnesota actually we've had foundations who've been doing Impact investing but haven't called it that for decades So we have rural foundations who've been investing in their own communities Throughout Minnesota lending money to small businesses to nonprofits to meet community needs for 40 years Some of them are now called community development financial institutions They're still doing that work and when I was first appointed Executive in residence with the council they called me and said Susan. What's this impact investing stuff? We'd like to learn more about it. I said well, you've been doing it for 40 years So part that's again where the term kind of trips us up But three years ago is when the explosion really happened Melanie and it was partly thanks to mission investors exchange Coming to town it gave us all an excuse to get together There are several of us individuals Rob Scarlett Jeff folks Brad Brown We had our fingers in different pies and we could see that there was a lot of activity Happening in the Twin Cities, but nobody really knew what the other one was doing So we said how about we all get together and we thought maybe five to ten foundations would show up And I think we had 60 At a meeting at the Northwest area foundation another foundation that has been doing impact investing for quite some time They've dedicated 10% of their assets to impact investing I mean, they're a real leader in the space including Being the chair of mission investors exchange as well as doing a lot of work on impact reporting But what happened next was the foundations all kind of looked around the room and realized that kind of like you were saying Cynthia They all had their their buckets and their priorities So if an impact investment didn't work for one it might work for the other So they started to get to know each other and collaborate and share deals and co-invest And it started with a group of maybe a Northwest area foundation with the McKnight foundation Which has also been doing impact investing for quite some time the Margaret A. Cargill foundation and then we had our community Foundations who actually one of them have been doing impact investing for at least ten years Not called an impact investment, but they helped out the city of St. Paul And so they everyone started to realize that people were were starting to look at assets other than grant making They were starting to look at their portfolio or some of them particularly the community foundation seemed to have some kind of Squirreled away pots of money as that to use a technical term Where they found money that they were able to redeploy out into the community In a revolving way so that money would come back in advancement of their mission rooted in place in their community So in 2013 there were a few doing it 2014 the conference there were more and more and more then the Bush Foundation stepped up to fund the Minnesota Council on Foundation's Residency so that all 180 members would would be able to just call up and get advice on impact investing Then enter the the impact hub Minneapolis got started a few years ago and a lot of their members started asking questions about impact investing Not so much from the sources of capital side, but from the entrepreneur side and the intermediaries and the financial advisors And we all got together into a community of practice that still exists to this day and we decided Together as a group to map our ecosystem It started out with 50 people in a room, but at the end of the year We had invited over 400 people Consider themselves part of our ecosystem and we really view it not so much as a net But we view it as a garden And and of course in Minnesota It's got to be an indoor garden because we wanted to grow all year But it's a garden that that the community owns nobody owns the ecosystem the community owns it and things are growing and the Foundations are there and they kind of have their own garden as well But they're part of the ecosystem and they're helping things grow by investing in the ecosystem Because a lot of this does require the grant capital Necessary to make to make a garden grow But then there are other investors who want to get involved and they can just look on the map and see oh You know I didn't know that the Mortensen Family Foundation was doing impact investing All right, I didn't know that the Otto Bremer Trust was a hundred well 92 percent Impact, you know aligned with their mission of Investment for the for the good quality life in their region So we've really seen this ecosystem just explode and it continues to grow Partly thanks to the resources you mentioned that are so critical I mean a garden needs sunlight needs water it needs fertilizer to grow and the Bush Foundation stepped up as well as that The impact hub for another year to make the garden grow even beyond the the four to five hundred people who are involved in it now I'd love to get to get to some additional specifics so some examples for those in the room around the ecosystems And I want to turn to you will because this really is advantageous to MIE in building into its next conference as well because as you know Susan We go out into the community in our conferences and look for impact investing in action and that really takes those investees Playing an enormous role in those communities to help our members and participants at our conference to understand this work better And so we're going to Chicago next in May of next year and for you Will I'd love for you to get to deployment and and getting money on the ground into Projects into people in your communities. I know that you have started to deploy capital from benefit Chicago and I'm interested in Talking about the opportunities that you've seen and where some gaps may exist And where you think you're going from here. Okay, great. I think first of all as we talked about Benefit Chicago in and of itself is an ecosystem in a collaborative way, right? So we have MacArthur Foundation who helped sort of establish and set this up with their investment We also have the Chicago community trust Which is using their donor buys funds and their sort of network of being a hundred and twenty five year old organization in the city Support and then as a little secret sauce then is the Calvert Foundation Which then allows through the Calvert note the local resident to invest in the fund itself And so now you're starting to create an ecosystem where people in their community can walk by a project and say I'm causing that to happen right that that oftentimes in our communities We're waiting for someone else to come in and cause things to happen We're oftentimes the the hand that we need is at the end of our own arm, right so that we can sort of reach into our Pocket and perhaps Not get four cups of coffee that week And make an investment that will bring fresh food into your neighborhood that will help open up a daycare center that will help, you know employ Returning citizens into our community To work and so what we're trying to do with Benefit Chicago to get the deployment first is really understand What's what's the man and what's the market, right? So we've deployed the same sort of system. We want to go out and understand We want to listen understand and then support, right? And that's how we want to lead with our work that we're not going in taking over We're not telling them here's how you need the money, but it really is this notion of allowing the community to sort of take shape So the first in building the demand side is being clear and explaining on what it is, right? And so often when you have a MacArthur or a trust who are known for giving grants People first come up and say I'm here to get one of those Benefit Chicago grants You know and so we have to really take the time to get them to understand and explain What an impact investment is and why we are lending money and not giving out the grants and that's sort of our slice of The ecosystem is the loan portion. What we've seen in our roughly 12 months of being active is about 80 applications tolling roughly about a hundred and sixty million dollars in request And really going through that in a very methodical way. We've deployed six investments so far. No two investments are the same We really take the time to understand the individual business their needs how they need the capital how it should flow into the organization How are they? Recording and reporting their measurements and impact and then try to work with them on a term That works to fit the needs that they're doing and I can give a couple of examples If you don't mind about some really interesting things that we've been able to do One there's an organization called Garfield produce. This is a two-person right now urban farm And they sell microgreens in in the city to about 19 restaurants right now They got their reputation and got to be a little bit known and caught the ear of Whole Foods or Amazon However, you have everyone to call it now. And so I was at this is great We'd like to use your product. We want to come by and see your facility They said oh, this is fantastic Whole Foods shows up to the facility and say well, hold on We can't put this we can't put this on our shelves You know you've got you know, you got old wood Trousers and other things and you got to convert this to some different standards that we can make So we're coming in actually at an excellent time to really help them meet those Requirements right to get them onto a path now that they will be able to connect in To Whole Foods and Amazon Which will have a tremendous impact on their business This business is run by a young man who's a returning citizen who wants to hire more Individuals like himself who have maybe had some running in the past when they were young and really sort of use that as his mechanism Through this urban farm Business study has the other thing that we've seen is because we've done the due diligence and the team Has really learned the business this stamp of approval from benefit Chicago has encouraged other investments to follow So now we've leveraged up our investment with these outside investors who have also come in to support the business And this is part of the work that we're really trying to do and what you find when talking with them is through the process of applying They've learned to look at their business differently. They've decided. Oh, we should really be using the board this way Oh, we weren't measuring this we should start to do that And so they've been really appreciative not only of the capital that flowing which is important But also the process in which they got the capital has helped them view their business differently and has really sort of put them I think in an excellent position Going forward and again, this is a loan that you couldn't traditionally get With the current algorithms that are used by traditional lenders. There's just no way And so this business could have been on a verge of disappearing from the neighborhood Crushing some dreams of a young man who had gone through some hard times and finally found his way And instead now is looking at how am I going to be working with Amazon, right? And that's to me Is this an incredible story on how we can really work through the ecosystem to change Dejectory of an organization of the second one. I'll talk about is an intermediary called Community neighborhood initiatives and this is a business that has been doing a tremendous amount of work on the far south side of the city And has a number of avenues that they do their micro lender. They help do development They do a bunch of things and what we're working with with them on is the fact that we have a small Business entrepreneur female-owned business on the south side that does baking Cookies and cupcakes and things and they were currently situated in a poorly accessible area behind the police station Now some might say being a bakery and making donuts behind a police station is a key Strategic location, but they were looking for more of a retail front, right? And so we've made an investment in CNI who's then working with this entrepreneur to get them into a more commercial strip Their social impact is that they're using food as conversation So they're not only just baking and sort of selling their goods, but they're using this as a mechanism to draw communities in Start to have conversations about what's going on in their community in their neighborhood and so now they're in a prime location on a mixed-use site that has a Walmart and a number of other sort of businesses that are getting this additional traffic Which is also helping them hire additional people Create more places for gathering and community Convening and we're starting to see those conversations really come out because in a lot of our urban centers You're lacking places and spaces to gather right? These are neighborhoods where you don't go near the windows at night, right? You tell your kids get inside and do those kind of things when the lights go down And so now you're creating these more vibrant spaces where people are more interacting and this is again a Phenomenal sort of output that we can have through these investments So we have one direct investment in a small Urban farm and sort of the activities that are going there and in this indirect investment through an intermediary through our funding That's allowing a business to grow and expand and I think those are two Good examples of the things that we're trying to do here all with the intent of Creating wealth for both the business owner growth and assets being able to hire people Job creation again putting people back to work. We think is an exciting and great opportunity Are we know our individuals both young and old want to work? They're not lazy They're not sort of look at their lacking opportunity. So the more we can create that is better And then lastly to support those organizations that help people gain Maintain and excel in employment and so we want to ensure that there's different on wraps at the employment level Opportunities for those individuals that are looking for work and that's really what the ultimate goal of Benefit Chicago one of the key ingredients or tools that foundations have is to D-risk investments to bring on other types of investors and you mentioned will that Benefit Chicago has seated interests and follow-on investments by others and I'm curious what types of investors Have have come to these investments. Are they other foundations or are they other? Types of investors you mentioned individuals, but as far as Institutional what so we've seen a little bit of both You know the hardest part when you don't have access to friends and family capital is that first gate, right? It's everyone's very interested until you ask them for a check Right and so we're trying to sort of pave the way a bit that will allow that gate to sort of go go in Now no one everyone's making an assumption the first person who makes the first investment must know what they're doing Right. I mean that's didn't to happen because I mean almost immediately after we made our investment We saw a small investment fund Immediately sort of come in following us. I mean it's weeks after. Oh benefit Chicago. Oh, it must be okay We're coming in and they had been talking with this particular group for months with no progress And so we're very pleased to see that we could come in And they're trusting our due diligence, which I believe is accurate. These aren't fake great These aren't grants disguises loans. These are actual loans. We're looking to get people repaid And then seeing this additional capital sort of flow back in Has been interesting. So there's been a couple of different types. So we've had there's some in Chicago We have a 1871 which is a sort of incubator hub and there's some offshoots from impact engine That have sort of grown and it's this smaller group. That's sort of an offshoot of impact engine that's making this investment In Garfield produce They've also been a little more aggressive and taking sort of a seat on the board and sort of helping them sort of grow There so they've got a very interested partner with some, you know, real background to help them sort of grow And then we've seen some other Grants and other things that have flown in after we have come in After we've been able to sort of do the due diligence to put it in It's very early on now, but I think this is a trend that will Likely continue as we're strategic In the risk that we're taking in the businesses that we're supporting And really based on the support that the community is allowing the business to have and that's really what we're supporting As we look to document some of these models in order to share with other communities And I will say that's an offshoot Really the funding for our work at mission investors exchange is an offshoot of the successful promotion and launching of benefit chicago because we The mccarthur foundation has funded research with urban institute to do Over 60 interviews around the country With these leads in place So those passionate leaders that I mentioned before are all being interviewed and so that we can take these tools and help other Communities to do more of the work one of those communities that W. K. Kellogg is working in and has for many years is in Santa Fe, New Mexico, Cynthia and I'd love to know how a national foundation Uh Figured out how to work on the ground it with this intentional ecosystem building I know that you have program officers that are dedicated specifically to those communities in Santa Fe, but how did you Create the the additional infrastructure that you needed for your initiative. Sure. So as I mentioned earlier We have a footprint in the state of New Mexico. We have A little less than a half dozen program officers on the ground in New Mexico and these are individuals who are from New Mexico Have relationships have been in government and worked in on profit So they really had a really strong kind of on the ground perspective About the community and really deeply embedded as as is all of our plate named places across across the foundation and in New Mexico We had uh, you know, we started seeing more bubbling up of interest in opportunity potential opportunities for investment. However, they To do this work well It can't just be the W. K. Kellogg foundation, right? We are in these places and certainly We carry a little bit of a big stick But you know, we we we know that our role is really to help facilitate and so Um our team on the ground Start talking about some other foundation a fake community foundation and a couple of other family foundations who are also attending MIE events and reading books and on twitter and started having this conversation and We um hired avivar capital antennas over here somewhere Who did a really fantastic landscape of the capital needs across the state so talking to Both folks that were in state out of state who might have an interest in new Mexico talking to Um consultants and and other kind of key stakeholders to really get a sense like what's the opportunity to look like? What's the pipeline look like and that ended up informing how this cohort of Foundations and families and and I think a couple of corporations came together and started looking at pipeline and so the So basically there's um a couple of groups that are really helping to drive the pipeline development So we're working with our grantees and identifying this potential grantees that you know might be ready for a pri or thinking about You know a new innovation to um, we've actually had um Some outside folks who are outside new mexico who want to go into new mexico and helping to connect them to this cohort of folks and again all under this rubric of making sure that The the co-investors in these specific transactions are somewhat aligned So um as many of you know, um as evidenced by our racial equity track racial equity is a big um a big Issue for us at the foundation is actually what drives almost everything we do We want to see equity In all forms in all of our investments And so we we hone in on that pretty strongly And we're we're pretty clear with our partners and we work with them We work with where folks are at how from how we're thinking about who's benefiting and who isn't on an individual transaction But also the metrics that we're we're tracking, you know, and how everyone is using the metrics not just to track metrics for metric sake um, and so we're really wanting to Almost create this co-investment and you know not being exclusive being we want more capital coming because that's we believe our role Is to use our our capital and you know the riskiest positions in some cases, but also to really um Encourage others to come into this space And so it's been really exciting for us the foundation to watch this particular ecosystem grow Because you can see the confidence that the different investors are getting now people bringing deals and all of a sudden we're all We're all worried about the payments and you know Loan loss reserves and whatnot But whereas like a year ago two years ago people were like we'll just leave it to you guys And so it's really exciting not only to get capital to be deployed But also building up that infrastructure for so you know, it's not just the Kellogg foundation It's the it's the communities that are really driving it and I do want to make a point I know we're talking a lot about um investors that are driving these ecosystems And we really we really strive to make sure that our communities are forming us what they need And so and that's where I think we're our program officers And our relationships on the ground come into play making sure that we have an understanding We're not trying to do these transactions to do these transactions, right? We're really trying to affect systemic change in these places that not only Benefit, you know, New Mexico, but also can benefit, you know, Kansas or any other state that might be thinking about such an ecosystem and For us That's a really critical component I think when impact investing the term really was coined I think there was a lot of excitement and wanting to get the deal done But not really thinking about what happens after the deal is closed. How do we deal with workouts? How do we navigate this as a group? And I think the ecosystem particularly in New Mexico and in michigan and minnesota are creating these Kind of almost checks and balances where the group is going all in together Knowing that they're taking on risk knowing that this may fail and also trying to mitigate together as well Which I think is just as important because some of these deals are not going to be strong, you know, things are going to happen We, you know, we we can see how things can kind of switch really quickly And so not only is it about ensuring the capital is there but also understanding like what are we going to do when times get tough as a group individually Education has been a big part of the work Of all three of your efforts And I'd love to ask you Susan about education because I know you've done a lot of it in twin cities over the years Can you talk about educating? Unlikely players in the ecosystem so Players that You know for our case focus on foundations foundations wouldn't normally work with and are you getting them around the table And what are some of the cultural barriers that you've seen working cross-sector working Interculturally, I guess you could say as a philosopher. Let's give us your your opinion on that Sure, I'm sure your experience. I'm sure socrates had an opinion on that But I would say that in our ecosystem, you know, we we really engage all all players So we've got the sources of capital We've got the users and the investees who need the capital the intermediaries and then kind of the field builders Underneath and we need we need them all to be involved and even in the foundation community We're working with people from different parts of the foundation You know tear down those walls between the investment side and the program side Those sides are getting blurry now. Some of the program officers are going to the investment committee meetings Some of the investment committee folks are going on site visits, you know, there's there's a There's a blurring now. So even within a foundation, we're dealing with different people the chief investment officer Sometimes the advisor the consultant. So even within the foundation as a council We're we're dealing with different parts of of our member organizations within the ecosystem We're really lucky to have an impact hub where everyone is welcome Every it's very inclusive all are welcome the barriers to entry to joining are very low So everyone can come and we actually have this really extraordinary group of Including financial advisors and and sometimes they're kind of missing from these meetings and from these conversations And yet they're critical to Mainstreaming this idea of investing for impact. So we have a group of financial advisors Who come to our meetings regularly and even though they are technically Competitors in this area Learning learning about impact investing responding to their clients who are asking about it Particularly their family clients as the as the next generation the millennials are you know turning 34 35 They're getting onto the boards of these foundations. They're asking their mom and dad's grandpa's advice Or is how come we're not investing in accordance with our family mission? Why why is it just five percent? What about the other 95 percent? So we've we found we need to create a safe place where people can come together as an ecosystem And safe means all sorts of things. It means that everyone's welcome We also bring a a de eye lens to everything we do And so we're we're thinking about inclusivity in lots of different ways But one is that it it we have created a pitch-free zone So that the foundations when they do come to ecosystem events They're not going to get you know grabbed and so it's a safe place for them as well But then we're also working in in terms of the pipeline and an education One of the findings of our ecosystem work is that guess what there's a disconnect Between what the investors want and what the investees need So the investors, you know, they want market rate Investments aligned with their mission are going to achieve a great impact and never have a workout or a problem That's what they want In the meantime, we've got investees who want 100 your money at zero percent. Thank you very much actual quote from one of the entrepreneurs in our study And I was just talking to an entrepreneur today who said he'd really like it if he didn't have to pay any interest ever whatsoever, you know So we have this disconnect And what we found in in communities that don't have the friends and family or can't go to the golf course with You know uncle bob and and ask uncle joe to fund your latest Venture we have to invest in the ecosystem and that's where foundations can really play a critical role So we're excited in minnesota one of the great initiatives that grew up out of our Growing garden of our ecosystem is something called connect up minnesota And um the the inspiration behind that is in the front row there Elaine Rasmussen CEO of social impact strategies group But this is to get money into the hands of people who don't have A pathway to that friends and family round So the education and that is going to lead to a pitch event So what we found with education is is we really have to meet people where they are And talk in the terms that they can understand So as a as a cfa a chartered financial analyst If I go talk to the chief investment officers the fund managers the investment consultants There is some language that I use if i'm going to go talk to all my program friends and my You know nonprofit and social entrepreneurs are maybe different language I think the important thing though is to draw that always be thinking about who's not in the room You know are are the you know in in the twin cities? We have a large native american community. Are they in the room? What about rural our rural friends? Are they in the room lgbtq? socioeconomic disadvantage is ever you know african american are they in the room and they are but not not in the numbers Or or at the table as much as we like So I think the education is critical, but it also has to be targeted to each audience We heard a challenge this morning in the plenary About the creation of an impact advisors a specialty In in the advisory community, so I think all of us together will probably Put a check mark beside that as something that we we might see coming down the line Well, the cfa institute has incorporated esg into Cfa level one into the test So this this idea of risk analysis is really that is becoming mainstream melanie. Absolutely I just want to add something on the on the when you're thinking about the ecosystem and we're thinking about the pipeline I think one of the gaps that we're trying to address in in our places But what i'm seeing across the field is we get these investors together They're all they get through all of the trust building But then the pipeline doesn't match up right or the pipeline's not there And so I think that's kind of the next wave And I think you know groups like impact engine village capital and others are really helping to really stimulate that pipeline But I I would really encourage for those of you We're thinking about your ecosystems that whether they're sectors or Our geographies to really keep that in mind because I think that's where things fall Everyone gets excited about doing the deals together. They're like, oh wait, there's nothing for us to invest in or it's not ready And I think the other thing that the other angle on the education piece and I also include this in the ecosystem Are our universities, right? So how do we start to work very closely with our universities to get this into the curriculum? So that these individuals if they don't go into impact investing Perhaps they're running a business Perhaps they're leaders at some point on a board of an organization And can start to have this sort of come in Top-down bottom up. I think that that's incredibly important. I think we also though need to expand which universities we work with Right. So here, uh, it seems everything is stampered stampered stampered back in Chicago Everything's university of Chicago or northwestern if I'm in boston everything's harvard We have to look at our our our educational systems across the board at a number of institutions That can get that in it's great for those who can get into those institutions They're phenomenal institutions and do a great job of educating But far more individuals are at our community colleges at our city colleges at our state run Facilities and institutions and getting them to sort of participate I think and understand the impact of the work that we're doing it will be incredibly helpful in moving this Industry forward in the future Well, I also think if I may jump in on education I think to really build the the pipeline of impact investing and Leaders of tomorrow. I do think we need to reach into universities to people studying finance and studying investment But even go to people who aren't studying those topics because they think maybe finances is boring and and only for white men Which if you go to a cfa conference, you'll see what I mean No, no disrespect to to the white men in the room But I think that if we could let the the students know that they could study interesting topics like education or environment or economic development And earn their financial credentials. I think we would open up the field to more people. So I do think that Meeting with people who are interested in finance and letting them know that there are different career pathways out there Because then they can become the fund managers of of tomorrow And I would say that's both on the lending finance and on the borrowing entrepreneurship Yeah, the whole the whole spectrum, yeah Do you see a an avenue from mba schools to To to real jobs now in philanthropy or in investment firms As impact investors Is there a good outlook for that in your communities? Well, I I think that we're talking about the blurring that's occurring earlier I think what we'll start to see is corporations really start to blur the lines as well And it will become more difficult to determine whether this is just a ploy of the corporation Or are they truly being philanthropic? And they're doing this in more and more real time, right? Cam newton makes a comment about a female reporter dan and yoga drops him the next day President trump Says there's big water lots of water around Puerto Rico Walmart the next day says Puerto Rico despite the water, we're still united, right? And so we'll start to see these corporations start to take different roles As they realize that the government's not going to solve it on their own Philanthropy can't do it by themselves And even the impact investment group will need support And I think we'll start to see this trend continue as women and millennials push us A demand that we sort of look at things this way and generation z is even stronger than than the millennials And so we'll start to see this blend so your opportunities may expand to non traditional impact investment type Positions outside of what we currently see as opportunities today Well, I was just gonna say, you know, I think on the work and for those of you that were in the session this morning Around the business case for racial equity, that's exactly what we're trying to get to right showing the opportunity for Reframing how we think about communities and not as you know, not as a deficiency But as an opportunity and I think the more that we start to See that play out and we already have a tremendous number of examples of this We'll start to see those opportunities in a much different way And I think, you know, we'll have to do the track of changing the system So, you know some of these conferences are a bunch of white dudes, but you know really opening it up But I think in ways where We all of us in this room and beyond start to think about the opportunity not thinking about a below market or market rate But really thinking about what is needed and what's the capital and other resources that we have to deploy I would I agree with everything you're saying, but a slightly cautionary note is I don't think there are enough jobs that are 100 Impact investing there. They're only a handful of those positions across the whole country. I'd say maybe two handfuls So I think for people who want to get into this field I think it's important to have a well rounded toolkit Whether it's in philanthropy or an investment or social entrepreneur So actually when when the people call me from the MBA school and they want to get into impact investing I I tell them go get into investing And and kind of warm your way into impact investing or into into a company We just have an MBA grad from the University of Minnesota who's who's gone to work for eco lab Which is doing a lot of great work in water. We also have some very interesting innovations coming into with corporations So I agree with you will on that, but I actually am cautioning people not to just Peg themselves into this one part of the whole financial industry Which is actually quite an interesting diverse place where they could plug into a lot of different ways And just like we need to bring dei lens into everything not as a separate bucket We need to bring this idea of aligning investment for impact into all of it So we kind of deploy them out throughout the industry This is a real inflection point for foundations as well And when we think about the expertise that comes out of those who have been working in philanthropy for so many years The thematic expertise for for instance on the program side And when you think about either your foundation or others Do you see opportunities existing for those program officers with 20 plus years of experience to be involved As impact investors or in these conversations in your in the ecosystem building I mean from from my my last year at the Kellogg Foundation, I think absolutely we need those program officers to Add this new language of investing into their into their rubric of tools, right? And so at the Kellogg Foundation while it's not perfect We are certainly Starting to blend those teams quite frequently actually we brought like half of our Racial equity team here today who does all of our programming there, but we really want And I think there's an opportunity within the broader philanthropic space to start that blending and having those conversations and and going through the discomfort of trying to You know feeling a little dumb in an investment discussion or you know, or feeling a little dumb on the program side So I think I think there's a trust building because quite frankly the issues that we are addressing today in this environment are far Outweighed how much capital we have Individually and the only way to start to address this is going to be around this this this ecosystem Understanding different perspectives having empathy and and and and patients to go through these conversations And and to support, you know the deployment more capital because otherwise we're just all going to work in our casilos and nothing's going to get done So we we're really seeing as some of our foundations in Minneapolis, st Paul and north westeria foundation is using the same Organizational structures heron heron where where they're not there aren't silos anymore You you have access to all the resources of foundation. We're seeing, you know at the bush foundation Program officers going to investment committees meetings and vice versa So we're there's so much wisdom in the program Staff in terms of knowledge about some of these important issues facing our communities And I think the investment side can really tap that knowledge So you don't always have to hire a consultant to tell you your strategy in education You probably know that in-house if you go ask your grant side Same on the impact evaluation and reporting go ask the grant team They've been asking for grant reports for years and they've they've got there's got great wisdom there Yeah, I would just say It's I think in fact true that the Impact investment officers Play play a key role The one thing I do think we do need is diversity within the officers Right that come from different backgrounds and from different locations on both the investment side and on the officer side so that there is some Under more understanding or some of the least within the institutions that can help sort of translate Some of the the hurdles and difficulties That happen in in in our communities and it's this sort of triple juggling act that we all have to do right We have to be scholars and be able to sort of understand and measure the impact and talk about history and lit reviews We have to be practitioners understand how things are actually happening on the ground And then sometimes you have to be activists right and we have to sort of Be able to merge between these three sort of activities And then change how we talk about as you said earlier if I'm talking to a ceo this way if it's uh, uh, Denzalis I talked this way if it's jamal you got to talk jamal this way All in a way to sort of get them to sort of understand to get them where we need them to be And that comfort and being able to play those different roles becomes critical In in helping move the field forward and I think that's a great point because it gets back to to susan's point around You know Folks are not Folks coming out of business school, you know, there's there's not enough jobs here But if there's you learn this agility, right and you're able to Uh translate for different audiences and that comes from being in a a bunch of different positions and a bunch of different sectors and organizations Cynthia, thank you will thanks susan Would you like to continue this conversation? If if you do there is a session following where you'll hear real life examples of how foundations have Worked with their investees to create real deals. It's in the firehouse. It's the last in Our series today in our spotlight series at socap We've been so privileged to be here and to share your wisdom and knowledge We really appreciate it continue the conversation with us at the firehouse next Thank you