The Saginaw Covenant Academy is now in its second month of operation thanks to an impact investment by the Saginaw Community Foundation.

The academy is one of three locations in Michigan that provides educational opportunities to youth who are experiencing homelessness, considered at-risk, who have dropped out of school and those who have been incarcerated.

The community foundation provided a $400,000 loan, to be paid back over four years, which helped transform a former funeral home into the new educational institution, which serves students ages 16-22.

The project surfaced as a need from the community and aligned with a key focus area of the community foundation.

“Our board of directors, through some generative governance discussions, has really been talking about how we can truly address the cycle of poverty we have in our community. We have been looking at this through an educational angle,” Renee Johnston, president and CEO, Saginaw Community Foundation and chair, CMF’s Impact Investing Committee said.

Johnston said there was immediate interest from youth in the community in utilizing the academy’s services.

WSGW Radio reports that Saginaw Covenant Academy is already serving 25 students who were facing barriers to completing their education.

“The more we can get to young people in our community who have fallen through the cracks and lift them up so that they can be successful and active people in our community, that’s one step toward breaking that cycle [of poverty],” Johnston said.

Johnston said they have received positive feedback indicating that this project is truly addressing a need in the community.

“I think philanthropy has more opportunities like this across our state and we just need to jump on those opportunities. In some cases, it will mean taking risks, but we can weigh those risks, and as philanthropic leaders we don’t have to do this alone,” Johnston said. “We can really look to each other and I think that’s also the purpose of CMF’s Impact Investing Committee – to continue to lay the groundwork, the knowledge and the awareness of how this vehicle can truly be very powerful.”

Johnston and the Impact Investing Committee will meet in the new year to shape their plan of work for 2019.

Over the summer, CMF gathered feedback from members through an impact investing online survey to better understand perceived barriers, specific issues of interest and successes in impact investing.

Moving forward, the data will help CMF better assist members who want to learn more about what their colleagues in the field are doing, have done and hope to do in impact investing. It is also informing our learning opportunities, demand for the impact investing expert-in-residence program and the development of new resources. As needs in communities continue to grow, the norms of philanthropy are tested and types of philanthropy are diversified to innovate and put more of philanthropy’s assets to work solving these problems.  

“Impact investing is not really a new practice; we know that it has been going on for decades in communities across the country as boards of directors considered capital needs in their communities and exercised business practices utilizing the foundation’s assets to meet nonprofit sector capital needs,” Debbie McKeon, executive vice president and COO of CMF said. “Defining these practices as impact investing has, in many cases caused concern, though it was really aggregating the learnings of an existing body of work to accelerate shared learnings, its use when appropriate, and facilitate continued innovation on the uses of philanthropy’s capital to grow mission impact.”

“We are also participating in the national conversation about how to facilitate deal flow, from ensuring that potential investees are investment ready to help investors identify deals, to efforts that can reduce transaction costs,” Jennifer Oertel, CMF’s impact investing expert in residence said. “Toward that end, at CMF, we are going to be more proactive in convening not just our members but all of Michigan’s stakeholders in order to facilitate communication and resource sharing amongst those groups.”

Oertel said she is seeing a growing interest in the practice of impact investing from CMF members, including conversations around Opportunity Zones legislation and investments in the Michigan Collaborative, a publicly traded mutual fund available to CMF members, managed by Community Capital Management.

Want more?

View CMF’s collection of resources and information on impact investing.

Check out our Opportunity Zones resources.

Learn more about the Michigan Collaborative.