A year after its launch, the local impact investing initiative Benefit Chicago has announced its first round of loans.
Six Chicago-area nonprofits and social enterprises have received a total of $12 million in low-cost capital to support their operations.
Research commissioned by the John D. and Catherine T. MacArthur Foundation and The Chicago Community Trust found a significant unmet need for financial capital throughout the region’s nonprofit and social impact landscape. That’s why the two foundations, together with the Calvert Foundation, launched this powerful collaboration that aims to mobilize $100 million in impact investments for nonprofits and social enterprises.
“The history of our three organizations is rooted in connecting financial resources to the causes and places people care about,” said Terry Mazany, the Trust’s president and CEO. “Through Benefit Chicago, we’ve combined forces to help bring needed financial capital to organizations that are poised to innovate, expand and grow.”
To date, Benefit Chicago has raised $77 million of that goal—including $12 million from 169 individual investors, who have purchased Chicago-targeted Community Investment Notes to put their money to work in local neighborhoods.
The recipients of this first round of loans are:
- AutonomyWorks, a for-profit benefit corporation which provides detail oriented jobs in the marketing sector for people with autism. Its $600,000 loan will support additional technology and the hiring of additional employees.
- Chicago Neighborhood Initiatives, a community development financial institution (CDFI) committed to revitalizing Chicago’s economically challenged neighborhoods, most notably the Pullman community. Proceeds from the $2 million loan will be used to complete the 111th Street Retail Gateway.
- Garfield Produce Company, an indoor vertical hydroponic vegetable farm providing sustainable employment in the East Garfield Park Neighborhood. The company will use its $500,000 loan to expand production capacity and increase its workforce.
- IFF, a mission-driven lender, real estate consultant and developer whose $5 million loan will finance family services in Humboldt Park and a youth facility in Bronzville.
- Local Initiatives Support Corporation, which will use a $3.5 million loan from Benefit Chicago to revitalize the 63rd Street corridor from Cottage Grove Avenue to Pulaski Road, and Halsted Street between 63rd & 79th Streets.
- Sweet Beginnings, a subsidiary of the North Lawndale Employment Network. The honey product business provides transitional jobs for individuals returning from incarceration; this $500,000 loan will allow it to extend the length of their employment as well as increase marketing efforts for their products.
“Through our Community Investment Note, investors of all stripes have been able to participate in making impact investments in Chicago,” said Calvert Foundation president and CEO Jennifer Pryce.
“From individuals investing only $20 online, to institutional investors placing $2 million with us, our investors have expressed strong interest in supporting Chicago,” Pryce said. “We think this can serve as a model for impact investing in other cities.”
Benefit Chicago executive director William Towns refers to these loans as “patient capital” because they can extend for up to 10 years, enabling the recipient to sustain focus on its mission without short-term financial pressure for repayment.
Towns said that while Benefit Chicago has already raised $77 million of the anticipated $100 million fund, he encourages investors and donors, large and small, to learn about the opportunities to invest. “Whatever the size, all are expressions of a commitment to Chicago, our neighborhoods and our people,” Towns said.
The initiative will continue to evaluate loan applications and to award more loans in the future.