The KL Felicitas Foundation believes there is demand and need for ‘social’ capital (i.e., capital which expects below market returns), particularly for social entrepreneurs and social enterprises. We also believe that foundations have a fiduciary responsibility to allocate part of their endowment or yearly pay-out for this purpose. In order to grow and reach significant scale, social enterprises need to be partly market-based and able to tap into mainstream capital markets for financing needs.
PRIs are awarded to charitable organizations or commercial ventures providing charitable goods or services. PRIs employ financing methods such as loans, loan guarantees, lines of credit, linked deposits, or equity investments. PRIs were created under the Tax Reform Act of 1969, Section 4944. Under Section 4944, private foundations are allowed to make ‘program-related investments’ if:
* The primary purpose of the investment is to advance the foundation’s charitable objectives;
* Neither the production of income nor appreciation of property is the primary purpose; and
* The funds cannot be used directly or indirectly to lobby or for political purposes.
* PRIs can result in a market rate of return or above as long as they comply with the IRS rules.
Click below to read each of the KL Felicitas Foundation’s Investment Evaluators for all Program Related Investments. Please refer to the KL Felicitas Foundation’s Impact Investment Evaluator Primer for background information and help on completing an investment evaluator.
Current Program Related Investment Evaluators
Other Program Related Investments include:
- Adobe Social Fund I
- Grassroots Business Fund
- Impact Assets
- Media Development Investment Fund
- Pico Bonito LLC**
- SMV Wheels
- SocialAlpha Investment Fund
- Social Impact Partnership LP (Social Bonds)
- Triodos Sustainable Trade Fund
**Although underwritten and presented here as a program related investment, note that this investment was not claimed as a PRI within our 5% allocation.