JUST IN TIME MISSION INVESTING
January 12, 2016
For the past eight years Broad Street Ministry’s 315 Café has been serving hundreds of vulnerable adults in Philadelphia overnight during the coldest winter months of the year. Last spring just after the café had ended for the season, the unthinkable happened – BSM’s entire heating system failed unexpectedly. With winter’s cold temperatures in mind, BSM began searching for philanthropic partners to help resolve this potential crisis. BSM was able to raise $60,000 through the generosity of the Connelly Foundation, Presbyterian Church of Shreveport and a board member, Tim Maguire, but that left a shortfall of $250,000. Two progressive thinking foundations – The Patricia Kind Family Foundation and the van Ameringen Foundation – each stepped up with a low-interest, seven-year loan of $125,000, $250,000 total, to cover the shortfall for a heating and cooling system ensuring that the café would be up and running this winter.
According to BSM’s Chief Operating Officer, Carrie Kitchen-Santiago, “It is unusual for foundations to make loans instead of grants. But these foundations did this because of their belief in impact, or mission-aligned investing. And for us, it could not have come at a better time.”
Mission investing refers to the use of investments by foundations as tools to achieve their philanthropic goals. The term mission investments -also called Impact Investments – is used to describe investments by mission-based organizations that are designed to generate both a social and a financial return.
“Now is the time for creative funding solutions to our community’s problems that nonprofits are tackling” urges Laura Kind McKenna, managing trustee of The Patricia Kind Family Foundation. “This type of investing is a win-win for the nonprofit, as well as the funder. The nonprofit benefits from a strong and invested partnership with a funder, and as payments are made the foundation can re-loan or re-grant the funds to other worthwhile causes.”
Kenneth Kind, president and treasurer of the van Amerigen Foundation, explains, “We want other foundations to consider mission investing loans in the future. Low interest loans are an impactful way that funders can support their nonprofit partners, especially during times of crisis, change, or expansion.”
With the generous impact investments from The Patricia Kind Family and the van Ameringen Foundations, BSM is poised to continue to provide radical hospitality regardless of the temperature.
How should other nonprofits seek out loans from foundations to support their missions? “We relied on our current relationships with these foundations to open an honest dialogue about our critical needs,” says Kitchen-Santiago. “Both foundations were considering, and ultimately approved, BSM for grants that support our daily work in the services we provide. But we knew without a working HVAC system we could not serve the city’s most vulnerable or our worship community. When they also stepped up with loans, we were happily stunned. We are so grateful to The Patricia Kind Family Foundation and the van Amerigen Foundation for their support of BSM and courage to pave the way for other foundations to consider unconventional funding streams.”
These loans as well as the grants and gifts from the Connelly Foundation, Presbyterian Church of Shreveport and Tim Maguire have not only made it possible for BSM to have heat in the winter but to keep the majority of the building cool in the summer. We were able to add air conditioning to the first floor where we host the Café and offer social services to guests of the Hospitality Collaborative (our meals with social services initiative) and to the back section of the second floor where we offer social services as well as programming for the Youth Initiative, BSM’s service learning program that teaches the importance of social justice to church mission groups as well as secular groups of middle school, high school and college-age students.