Impact Investments - Gates Family Foundation
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IMPACT INVESTMENTS FOR SOCIAL AND MISSION-RELATED IMPACT

At Gates Family Foundation, we carefully manage our financial assets to preserve and grow the Foundation’s philanthropic capacity. Our founders designed the Foundation to be a perpetual resource that will serve the community for generations to come. We also realize the importance of using all the tools available to us for the greatest impact towards our mission.

In 2014, we started to make mission-aligned investments — in addition to our grants — to expand our impact while also managing our endowment assets to support Colorado and its residents for perpetuity. As of 2022, Gates Family Foundation has committed $64.77 million to impact investing since we launched the portfolio.

Our impact investments take three different forms:

Mission-Related Investments

Mission-related investments (MRIs) commit a portion of the Foundation’s endowment capital for mission-aligned purposes that meet a market-rate return expectation. So instead of selecting investments based on financial performance alone, we may choose to invest in an early-stage education technology venture fund, or a private equity fund that invests in land conservation. The idea behind MRIs is that foundations do not need to sacrifice financial returns to increase their social impact. In 2021, the Foundation established the goal of targeting 30 percent of all new private equity commitments for mission-aligned opportunities.

Program-Related Investments

Program-related investments (PRIs) are impact-first investments that generally are structured to achieve below-market rate returns.  Examples could include low-interest loans to funds that support affordable housing or increase economic opportunity for underserved communities. PRIs are eligible to be included in the Foundation’s qualifying distributions, but the Foundation has chosen to treat these as commitments above and beyond the required annual payout. In 2021, the Foundation raised the cap on its PRI portfolio to 6 percent of a 36-month rolling average of the Foundation’s market value.

Socially Responsible Investments and Operations

The Foundation tracks environmental, social and governance (ESG) measures, diversity, equity and inclusion (DEI) factors, and carbon metrics across our public equity portfolio to ensure we’re making socially responsible investments (SRIs). We also practice socially responsible operations (SRO) by being intentional about the vendors and partners with whom we do business. When our partners share our values of community service and commitment to Colorado, the money we spend with them is furthering our mission.

Impact Investments Team

If you are interested in learning more about both program-related and mission-related investments, the Mission Investors Exchange and Confluence Philanthropy are good resources. Both are associations of foundations and other philanthropic organizations that use PRIs and MRIs to accomplish their philanthropic goals. The associations provide a forum for networking, professional development, collaboration, and outreach to funders, including those new to the PRI, MRI, and social investing field.

Impact Investments

Year Entity Amount Type Strategic Priority Area Served
2023 CO-Invest – Mission Colorado Fund $1,000,000

Mission-Related Investment

Community Development

Colorado and beyond

2023 Ecosystem Integrity Fund V $2,000,000

Mission-Related Investment

Natural Resources

Colorado and beyond

2023 Elevation Community Land Trust – Developer Startup Investment $550,000

Program-Related Investment

Community Development

* Statewide

2023 First Southwest Bank $1,000,000

Program-Related Investment

Community Development

* Statewide

2023 Lafayette Square Business Development Company $1,500,000

Mission-Related Investment

Community Development

Colorado and beyond

2023 Lyme Timber Company LP — Forest Fund VI $1,000,000

Mission-Related Investment

Natural Resources

Colorado and beyond

2023 National Forest Foundation $250,000

Program-Related Investment

Natural Resources

* Statewide

2023 Rose Affordable Housing Preservation Fund VI $3,000,000

Mission-Related Investment

Community Development

Colorado and beyond

2023 Sober Apartment Living CO $200,000

Program-Related Investment

Community Development

Denver

2022 Avesta Colorado Fund $1,250,000

Mission-Related Investment

Natural Resources

* Statewide

2022 Blackhorn Ventures Fund II $2,000,000

Mission-Related Investment

Natural Resources

* National/International

2022 Collide Capital $1,000,000

Mission-Related Investment

Community Development

* National

2022 Colorado Housing Accelerator Initiative (CHAI) Fund $1,000,000

Program-Related Investment

Community Development

* Statewide

2022 CU Healthcare Innovation Fund II $1,500,000

Mission-Related Investment

* National

2022 Elevation Community Land Trust – Chestnut Lofts $550,000

Program-Related Investment

Community Development

Denver

2022 Future of Water Fund I $200,000

Mission-Related Investment

Natural Resources

* National

2022 Greater Colorado Venture Fund II $1,000,000

Mission-Related Investment

Community Development

* Statewide

2022 Public Education & Business Coalition – Teacher Residency Program $250,000

Program-Related Investment

Education

* Statewide

2022 Reach Capital IV $2,000,000

Mission-Related Investment

Education

* National

2022 Reach Opportunity II $1,000,000

Mission-Related Investment

Education

* National