Healthy Food Commerce Investments

Investor: The Betsy and Jesse Fink Foundation
Investee: Wholesome Wave Foundation Charitable Ventures, Inc. - Healthy Food Commerce Investments Program
Asset Class: Private Debt - Bridge Loan, Guarantee Loan
Investment Amount: $100,000
Impact Sector(s): Agriculture & Food
Date of Investment: 2012
Projected Exit: Maturity of 3 to 5 years
Financial Return Goal: Below Market Rate
 

The Betsy and Jesse Fink Foundation is committed to addressing environmental issues through market-based solutions that contribute to the creation of a low-carbon economy. The foundation saw an opportunity to expand its impact beyond grants through a robust PRI program. Initially, this program focused on land conservation and preservation, although in recent years it has broadened its focus to include an environmental commitment to sustainable agriculture and food systems, specifically food waste and food access as it relates to food production and climate resiliency. Its previous portfolio’s impact strategy was less defined and consisted primarily of holding stock in companies that focused on carbon use reduction projects. The foundation has worked to better clarify this strategy and has a current target to invest 15 to 30 percent of its endowment toward direct impact investments.

 

In 2012, the foundation made a $100,000 loan to Wholesome Wave. Betsy and Jesse Fink were seed funders in the organization, and Betsy was a founding board member. Wholesome Wave used the capital to support three organizations: Grasshoppers Distribution (loan), Farm Fresh Rhode Island (guarantee), and City Growers (bridge loan). These financing models enabled these organizations to expand their businesses, meet increased demands for distribution, and invest in training and education for employees.

The family office CFO played a key role in drafting the loan documents. Wholesome Wave pursued a pipeline of impact investments and performed due diligence on potential investments, then used the foundation loan proceeds to make investments

 

The loans made by Wholesome Wave remain active, and it has started to see repayment from Farm Fresh Rhode Island. This has allowed Wholesome Wave to begin to repay the foundation at zero percent interest.

 

Wholesome Wave invested the foundation’s capital in growth-oriented enterprises that engage in activities including aggregation, distribution, and processing of regional farm products for sale in regional markets. The organizations used the funding to build infrastructure that focuses on food hub financing and sales while building food hub expertise and knowledge about impact investments and related policy. The investment in City Growers helped the organization drive passage of a major ordinance allowing commercial farms in Boston and as a result, as of 2014, 20,000 square feet of vacant, city-owned land is now available for commercial urban farming or gardening.