The US Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) has certified the Flexible Capital Fund, L3C, ased in Montpelier, as a Community Development Financial Institution (CDFI). CDFI certification means that an organization meets the following requirements: has a primary mission of promoting community development; predominantly serves eligible target markets; and is a financing entity that provides development services.
‘The CDFI certification validates our investment fund as a mission-based funder focused on community development,’ says Janice St. Onge, president of the Flexible Capital Fund. ‘Certification allows the Flex Fund to apply for grant and equity capital through the US Treasury's CDFI Fund. If successful in application, these funds could help us reach our capitalization goal of $4.0 million, provide loan loss reserve funding (critical to reducing our portfolio risk), and help us raise additional funds to provide critical technical assistance in support of our portfolio companies.’’
The Flex Fund currently has investments in Vermont Smoke and Cure in Hinesburg, Farmers To You in Berlin, Aegis Renewable Energy in Waitsfield, Liz Lovely Cookies in Waitsfield, and The Vermont Butcher Block and Board Company in Williston.’ ‘
‘Certification as a CDFI is also attractive to prospective accredited investors who are looking for not only a financial, but also social returns. In addition to now being able to seek federal funding, we believe certification will help us to attract additional private investment as well,’ St. Onge adds.
The Flex Fund joins the ranks of other CDFI certified lending institutions in Vermont including the Vermont Community Loan Fund, Northern Community Investment Corp., Community Capital of Vermont, Opportunities Credit Union, and Rutland West Neighborhood Housing Services.’ ‘
The’ Flexible Capital Fund, L3C’ is a mission-based investment fund that provides ‘equity-like’ financing in the form of royalty loans and subordinated debt to targeted Vermont growth companies in value-added agriculture, forest products, renewable energy, and waste management. Flex Fund investments are combined with business assistance to ensure borrowers have the support they need to stay and grow in Vermont. As a Vermont Licensed Lender, the Flex Fund is the first business lending program in Vermont focused on providing royalty financing for growth stage businesses’and one of only two such programs of its scale in New England. With royalty financing, instead of taking a piece of ownership in the company, a lender provides debt that the company repays by sharing a piece of their gross revenue over a fixed period of time. The Flex Fund’s innovative royalty/revenue-based financing allows for income and upside to investors while preserving ownership and mission with founding entrepreneurs.’ www.vsjf.org/what-we-do/flexible-capital-fund’ www.facebook.com/flexfund
US Treasury Dept issues Flexible Capital Fund CDFI certification
Submitted by tim
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