Did you hear the joke about why the farmer crossed the road? The punchline is that she wanted to go to the bank to ask about getting a loan. Not very funny, except that by the logic of bankers and Wall Street, the idea that a farmer would qualify for financing might elicit a guffaw or two. Small-scale farming is considered a high-risk, low-return activity that any prudent investor should steer clear of.
And yet, wending their way across the highway to the farm, who’s that? Why, it’s a gaggle of Slow Money investors, taking action on their desire to build local food systems. Are they just being charitable, driven by idealism to donate a bit towards keeping a neighborhood farm alive? Not at all—they actually are investors, doing exactly what a traditional investor does. They are considering their own financial situation and how it fits into their overall portfolio. They are asking lots of questions, getting to know the business, assessing the risks, and looking for ways that not only their money, but their expertise, could help assure the success of their investment. And they are negotiating a deal that works for both parties.
Wall Street “professionals” can’t relate to this new breed of more creative and engaged investors because
Tags: close to home strategy, community investing, financial assets, food, future, local, local investments, regenerative, tangible assets
Did you know that Calvert Foundation’s new Vested portal has lowered the entry point for its social investment opportunities to $20? Social impact investing is one of the best ways to get real bang for your buck, but until recently there were few options for people with modest savings to participate. Most impact investments are risky enough that they’re only available to accredited investors, though local and regional loan funds and Calvert’s Community Investment Notes made it safer by bundling many social-impact projects into a mutual-fund-like packages. Still, depending on the outfit, minimum investments were generally $1000 or more.
Vested opens these doors much wider, and offers beginning investors a wealth of choices: you pick the amount of your investment, and the term, as well as the type of social impact you’d like to have. Investments for 3 years or longer pay interest rates comparable to or higher than most savings accounts. Most exciting, you can choose from an array of targeted purposes, and with the low entry point, it’s easy to spread your money around a bit into several areas of interest. Familiar themes like women’s empowerment, microfinance, and small businesses are augmented by other intriguing areas of focus, including aging and education in the U.S. or fair trade overseas. For those who want their money to make a real difference in the world, this kind of direct investment in on-the-ground initiatives has far more impact than buying shares of even a do-gooder company. Your social returns are significant, while your money makes roughly what it would just sitting in your bank.
Tags: community investing, financial assets, global, justice
Two recent MBA graduates in Seattle are pioneering an exciting new approach to funding local businesses. They call it Community Sourced Capital, and they’ve already funneled about $1.5 million to dozens of small companies around the country. Their innovation is that the investments are zero-interest loans; lenders expect to get their money back, but the “returns” are explicitly in the form of social benefits, ie, enhancing their local economy by helping to grow small businesses. These are mostly modest projects (funding targets range from $5000-50,000), and 98% of the loans they’ve made so far are being repaid on time. In the words of CSC Co-Founder Rachel Maxwell: “Money does not have to be about creating more money—it is a tool we can use to create the world we want.” You can learn more in an interview with the two co-founders published on
Tags: close to home strategy, community investing, crowdfunding, financial assets
For two minutes on Wednesday, the dulcet tones of Hal’s voice went out over the NPR airwaves. He was featured on the Marketplace Morning Report, being interviewed from his home, which host David Brancaccio determined is “2001 miles from Wall Street.” The other stories, including floods in Texas and Greek economic ills, set the stage perfectly for his concise intro to The Resilient Investor, which offers a technicolor array of investment options in place of Wall Street’s shades of grey.
Listen here; the interview begins after the musical interlude, at about 3:45
Tags: community investing, financial assets, personal assets, resilience, tangible assets
Amy Cortese just launched www.locavesting.com and it looks like a great site and a valuable resource. We featured Amy in The Resilient Investor as one of the key champions of local investing and we’re thrilled she’s continuing to document and engage the movement. The website’s tagline is “Local Investing News, Education & Resources,” and that’s indeed what you’ll find—engaging tales of local investing successes, introductions to the many avenues now available to put your money to work in your local community, and topical coverage of key themes, including crowdfunding and growing the local investing ecosystem.
Tags: close to home strategy, community investing, crowdfunding, local, local investments
This article describes how peer to peer lending (or micro-lending) works, and compares several of the leading lending sites: Lending Club, Prosper, and Kiva. All these platforms allow investors to lend money to groups or individuals. Kiva loans are interest-free; principle only is returned. The other two require credit checks from investors and return interest as well as principle. Read the article.
Tags: community investing, crowdfunding, evolutionary strategy, financial assets, global, impact investing
This page from US SIF explains the different types and sources of community investment available to retail investors, including banking, loan funds, microfinance programs, and bonds. See more
Tags: close to home strategy, community investing, financial assets, local banking
Calvert Foundation’s Community Investment Notes were a pioneer in advancing community investing in both the US and the developing world. And now, their Vested platform accepts crowdfunded investments of as little as $25 as well. Either approach lets you pick your interest (small businesses in US, women’s empowerment, microfinance, fair trade, education, housing). Learn more.
Tags: close to home strategy, community investing, crowdfunding, evolutionary strategy, financial assets
Green America’s Community Investing Guide provides an introduction to community development financial institutions, or CDFIs – banks, credit unions, and other financial groups with a mission to direct your banking and investing dollars into projects that improve people’s lives. Visit website.
Tags: close to home strategy, community investing, financial assets, local banking
Ecotrust is a Portland-based organization that has been a leader in rethinking finance for nearly a quarter century. Its regionally-focused initiatives have attracted investors from around the country and created innovative models for others to replicate elsewhere. Visit the website.
Tags: close to home strategy, community groups, community investing, evolutionary strategy, financial assets, impact investing, regenerative, tangible assets
This report explains and defines community investing and its related products. Published by US SIF Foundation, it details current practices as well as takes a look forward at how to increase understanding and awareness of such products as well as diversifying products offered. See report(pdf).
Tags: close to home strategy, community investing, financial assets, global, local
US SIF: The Forum for Sustainable and Responsible Investment is the trade association for the socially responsible investment industry. Its website includes primers on community investing, divestment, and SRI in general, as well as a steady stream of topical reports. Visit website.
Tags: close to home strategy, community investing, financial assets, learning, shareholder activism, sustainable global economy strategy