A New Model for Place-based Investing
While the globalization of markets has dispersed investments around the world, we’ve hatched a plan to bring capital back to our communities in a transparent, coordinated, and collaborative way.
I’m excited to announce Canopy, an innovative, member-owned, for-benefit company designed to advance regional investing—at scale. Through a unique collaboration, Canopy is seeking to help communities thrive by identifying opportunities for investors to put capital to work locally in innovative ways. To make this happen, Canopy is bringing together diverse stakeholders—foundations, non-profit institutions, for-profit organizations, and individuals—to leverage capital in building a regional investment ecosystem that benefits communities and generates financial returns. Canopy’s members are pooling resources and sharing in the costs of sophisticated institutional investment research to surface regional investments.
Canopy is supporting investment managers and building a bench of entrepreneurs, through education and training, who can manage community-focused investment strategies. By building this capacity, Canopy is looking to ensure a long-term pipeline of regional investments that can withstand the rigor of institutional due diligence and attract new sources of capital.
Canopy is bridging the gap between communities and investors, who want to better understand local needs while adding value to communities through a coordinated, market-based approach. Instead of focusing on their own disparate missions, Canopy’s members are finding opportunities to co-invest their capital for regional advancement and solutions. Most significantly, Canopy is changing the conversation about how institutions and individuals put their capital to work to drive community outcomes.
In recent years, institutions as well as individuals have started rethinking how they put their capital to work beyond conventional investments with market-based returns; they want to see their investments serve a purpose in a particular place or in their local communities. Foundations, for example, increasingly hope to leverage their investments to support their local grantmaking strategies, but finding investible opportunities that align with their mission can be a taxing process.
Mission related investing, or impact investing, is particularly challenging for rural and/or unstaffed foundations which can lack access to information and resources to conduct due-diligence. Canopy aims to democratize impact investing, bringing the necessary scale and coordination to these investments.
Canopy is helping foundations, companies, and even individuals better align their objectives, allowing them to leverage capital, together, in innovative ways. Without Canopy, organizations mostly rely on traditional financial institutions and investment advisors, who generally don’t conduct costly research for a narrow audience. This can limit the number of local or innovative investment opportunities that are available to a place-based foundation.
It was with this changing landscape in mind that Canopy emerged from the parallel paths and vision of its Founders, Meyer Memorial Trust, The Russell Family Foundation, and the Laird Norton Family Foundation. These institutions, based in Portland, Oregon, Gig Harbor, and Seattle, Washington, first teamed up two years ago to find ways to drive economic growth and address important issues throughout the Pacific Northwest. In doing so, the foundations believed that they could do more by leveraging capital from across the Pacific Northwest, setting the stage for the region’s many disconnected stakeholders to become part of a bigger community-driven investment collaborative—Canopy.
Canopy’s name goes to the heart of its vision and mission. Canopy is the upper layer of a forest system—a familiar site in our home region here in the Pacific Northwest. Inspired by how a forest canopy opens to encourage natural regeneration and promote new growth, Canopy seeks to do the same by attracting capital to new investments in communities. Canopy begins here in the Pacific Northwest by developing a model for a regional investment ecosystem that could be replicated globally.
Originally posted on the Council on Foundations blog.
by Brad Harrison, Director of Strategy, Canopy