Good Capital Invests $200,000 in Root Capital

Good Capital, a San Francisco-based social venture capital firm, recently announced a $200,000 subordinated loan to Root Capital, a nonprofit social enterprise that serves rural communities in developing countries. As a part of this investment, Good Capital and Root Capital have developed a multi-year partnership that will focus on finding marketing strategies to build Root Capital's brand and increase its capacity for additional growth.

Root Capital provides capital, delivers financial training, and strengthens market connections to small and growing businesses – such as farmer cooperatives – that build sustainable livelihoods and transform rural communities in poor, environmentally vulnerable places. According to the organization, it has provided more than $200 million in loans to 282 small and growing businesses in 30 countries in Latin America and Sub-Saharan Africa and has a 99% repayment rate from its borrowers and a 100% repayment rate to investors.

"We have found a non-profit partner willing and able to take on our kind of growth capital to accelerate their social impact and to participate in a deep engagement that aligns our resources and talents with their needs and strategic goals," said Kevin Jones, Partner and Co-founder of Good Capital. "Root Capital provides the global reach, measurable impact and stable financial basis that was already making a huge difference in the world, where Good Capital's unique mix of talent and resources can add something new and essential."

"We are excited about our partnership with Good Capital and are looking forward to working with them to strengthen our brand and build the critical marketing and communication tools needed to grow our impact," said William Foote, CEO and Founder of Root Capital. "This partnership will help us to strategically identify both the financial and human capital resources needed for us to reach our long-term goals."

"It has been a goal of ours to show that it is possible to invest in a wide spectrum of companies with a baked in social mission that ranges from for-profit to nonprofit," said Tim Freundlich, Partner and Co-founder of Good Capital. "Root Capital exemplifies what a high performing nonprofit can be, while this engagement demonstrates the abilities of Good Capital to engage deeply across this spectrum."

Social Venture Capital Firms and Other Funding Sources for Social Entrepreneurs Highlighted by Inc. Magazine

Do-Gooder Finance (and related sidebar Social Capital) is an article in the February 2008 issue of Inc. that highlights social venture capital firms and banks that support social entrepreneurs.  The article includes information on the experiences of two social entrepreneurs who obtaining funding from these sources — Priya Haji, founder of World of Good, who obtained a line of credit from RSF Social Finance, Root Capital, and Shared Interest; and Charlie Crystle, founder of Mission Reseach, who obtained funding from Underdog Ventures.  Other funding sources mentioned in the article and sidebar include Good Capital, New Resource Bank, ShoreBank Pacific, and TBL Capital.

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