San Francisco Foundation Expands Impact Investments

San Francisco Foundation Expands Impact Investments

Two long-term investment pools now have automatic allocation to impact investment fund

SAN FRANCISCO – The San Francisco Foundation today expands the ways in which it advances racial equity and economic inclusion in the San Francisco Bay Area. Effective today, the foundation automatically allocates a portion of its two long-term investment pools to its Bay Area Community Impact Fund (BACIF).

Exclusionary policies and practices have resulted in racial inequities that prevent far too many residents in the Bay Area from thriving. For example, white residents are nearly twice as likely to own their homes compared to Black residents and 50 percent more likely than Latinx residents in the Bay Area. And the rate of business ownership is six times higher for white workers in the Bay Area compared with Black workers, and five times higher compared with Latinx workers.

As one of the foundation’s tools to tackle such inequities, BACIF provides local nonprofits and social enterprises with low-interest loans. Since BACIF was created in 2009, the foundation has made more than 25 loans totaling more than $26 million to community development lenders and established nonprofits in the Bay Area. As loans are repaid, the foundation uses the money to invest in new projects, recycling capital for the region’s continuing benefit.

Through BACIF, the foundation also invests in mission-aligned assets, like CNote’s Flagship Fund, a fixed-income product that invests in community development financial institutions (CDFI). The foundation also invests in credit unions supporting local businesses, such as the Northeast Community Federal Credit Union.

The foundation is proud of BACIF’s impact on Bay Area communities, individuals and businesses, and looks forward to increasing its investments. To start, 1% of the foundation’s Long-Term and Mission-Aligned Investment pools, representing over $4 million in capital, will be allocated to BACIF. This will increase over time with a targeted allocation of 5% from each pool, subject to demand for additional loans to local organizations that help advance racial equity and economic inclusion in the Bay Area. As the allocation increases, the foundation will make more loans that help provide affordable homes and good jobs to residents in the Bay.

“Advancing racial equity requires bold solutions,” says Sonja Velez, the foundation’s Chief Financial Officer. “In addition to our grantmaking and advocacy, our local impact investments, made in partnership with our donors, are critical to these solutions.” This allocation – from the foundation’s investment pools to its impact investment fund – is yet another innovative example of the foundation driving maximum resources to support its equity agenda.