As a private foundation, Dogwood can do more than make grants. We can also invest our assets in ways that further our purpose and strategic priorities. We call this kind of support an Impact Investment, (also called Mission Investments) which can draw from Dogwood’s general grantmaking budget or from the assets invested as part of our endowment.
Dogwood complements its general grantmaking budget with program-related investments (PRIs). While a PRI’s primary focus is on delivering positive social returns, it also can deliver a modest financial returns, which we can then redeploy into the region for charitable purposes.
PRIs provide access to capital when traditional lending methods may not be a suitable fit. Dogwood can deploy PRIs directly to individual organizations through vehicles such as low-interest loans or equity investments. We can also use PRIs to provide indirect support to intermediary organizations like Community Development Financial Institutions (CDFIs), which then make our invested capital available to a wider range of borrowers.
Our process for sourcing and approving PRIs is complex and rigorous. Therefore, we only consider PRIs by invitation. We welcome other funders who wish to join us as co-investors.
Dogwood maintains an investment portfolio to safeguard and grow its endowed assets, which in turn fuel our grantmaking and PRIs. As part of that portfolio, we regularly look for opportunities to obtain at- or near-market-rate returns from companies that align with our overall purpose and strategic priorities. These are considered mission-related investments, and allow us to further achieve our purpose while simultaneously being good stewards of the charitable assets entrusted to us.
During the COVID-19 pandemic, the Small Business Administration’s (SBA) Paycheck Protection Program (PPP) offered emergency funds to help businesses and nonprofits stay afloat. However, many rural and diverse-led organizations in WNC needed funds faster than the PPP loan process would allow. Dogwood stepped in to provide nearly $19 million in short-term loans to Mountain BizWorks to distribute quickly to local borrowers. As a community development financial institution (CDFI), Mountain BizWorks was an ideal partner to facilitate the distribution of these much-needed dollars using Dogwood’s investment to help area businesses retain nearly 3,300 jobs When the SBA funds came through, Mountain BizWorks repaid its loans to Dogwood.
“Small businesses and nonprofits across our region were facing unprecedented challenges and needed immediate relief to navigate the COVID-19 health crisis,” said Matt Raker, Executive Director of Mountain BizWorks. “PPP loans were an essential part of the needed response, and through Dogwood’s leadership and financial commitment, we were able to broaden access to PPP loans and bring more federal relief to Western North Carolina.”
Housing Assistance Corporation (HAC) had a vision to create four affordable single-family homes in Henderson County. They identified the perfect piece of land for building, but needed a short-term bridge loan for purchasing the property until permanent financing became available.
Dogwood provided HAC with a small bridge loan, enabling them to acquire the land promptly and begin construction. When the new homeowners closed on their mortgages, HAC fully repaid Dogwood’s investment, completing a successful cycle of support. This partnership between Dogwood and HAC demonstrates the power of impact investments in affordable housing.
By offering timely financial assistance, Dogwood enabled HAC to realize their vision and create homeownership opportunities for those in need.