Here at Francesco Collaborative, we’ve found that curating a shared culture gives us the freedom and courage we need to move differently as a community. Our community practices, which guide how we show up in collaborative spaces, lay the foundation for this culture.
One of these practices, grounded in the understanding that each of us is necessary—we are all members of the Body of Christ—recognizes that “we are better together.”
No one knows everything, but together, we know a lot.
Practicing a different kind of finance is hard work. A culture of radical contribution and collaboration allows us to act on our convictions in ways we can’t alone. It allows us to overcome the normative, administrative, and institutionalized hurdles that would otherwise hold us back.
On many occasions, we’ve seen actors from across the faith-based and impact investing ecosystems come together to bend finance creatively toward mission.
One example is a loan guarantee collaboratively orchestrated for Meds & Food for Kids (MFK), a US-headquartered non-profit that makes and distributes life-saving nutrition to malnourished children and mothers in Haiti.
When UNICEF, one of MFK’s buyers, asked the organization to triple its output in the face of growing global demand, MFK needed—and needed quickly—a supply of working capital that would allow them to maintain their factory in Haiti and increase their production.
When MFK first sought a loan from a traditional bank, they were met with difficult terms. Because of the violence, instability, and the associated increase of financial risk in Haiti, the bank required MFK to secure a guarantee for 125% of their requested loan amount. And, that it pay back that loan at an interest rate of over 10%.
Gathering within the Francesco Collaborative community and recognizing the competence, urgency, and importance of MFK’s work, an alliance of asset stewards began to imagine alternative paths that would provide the necessary capital at terms prioritizing impact.
After solidifying the interest of several investors, the new alliance performed the necessary diligence and brought in the team at Beneficial Returns, which offered to originate a revolving line of credit to MFK.
Ten of the investors then provided the investment capital and the guarantee capital needed to make it possible. Several of these investors elected a rate of return of 1-3%, and others a 0% return.
Once the terms were agreed upon, Beneficial Returns officially extended a revolving line of credit to MFK.
In the work of faith-first and impact finance, we really are better together.
We look forward to the creativity and collaborations yet to emerge from this community, and its flourishing in the new year and beyond.