Still have questions? Here are a few Frequently Asked Questions about the work of Contact Fund and their answers.
Yes, Contact Fund is similar to the Calvert Foundation Community Investment Note model. Contact Fund is much smaller in size and infrastructure than Calvert Foundation and its investments are targeted specifically to New York City community development unlike Calvert Foundation whose investments are international in scope.
Contact Fund investors are individual accredited investors (link), though potential investors include accredited institutions such as private and public foundations.
An individual would choose to invest in Contact Fund if they value liquidity and financial returns, and also want to know that their money is being used to leverage other investments in community development organizations in New York City.
An institution would invest in Contact Fund if they want to put their capital to work in New York City neighborhoods while earning modest return and leveraging other critical capital for high-impact projects. Foundations would be earning credit toward their annual payout requirement.
- Location: The organization must be located and operate in New York City
- Mission: The organization’s, or project’s, mission must be focused on strengthening the residents and neighborhoods of New York City whether through affordable housing development, economic development or some other social enterprise.
- Use of Funds: Contact Fund’s investment must be used to leverage other funds or play a critical role in the capital structure of a project.
- Impact: Contact Fund aims to invest in high-impact organizations and projects. By high-impact, we mean that the projects being funded are having tangible impact for the duration of the investment. Ideas are being put into action, shovels are being put in the ground, entrepreneurs are seeing easier access to capital so that their business can grow, or homeowners are finding relief from the threat of foreclosure.
- Risk: Contact Fund will often enter into a deal in a subordinated position to other lenders, as that is where linchpin funding is required. To mitigate this risk, Contact Fund focuses on the track record of the borrowing organization, developing strong relationships with fellow lenders who have the best interest of the borrowing organization in mind, and paying attention to shifts in local housing markets, city policies as well as NYC community development trends.
By high-impact, Contact Fund means that the projects being funded have tangible impact for the duration of the investment. Ideas are being put into action, shovels are put into the ground, entrepreneurs are seeing easier access to capital so that their business can grow, or homeowners are finding relief from the threat of foreclosure.