Social Finance Selected by Citi Foundation’s Community Progress Makers Fund to Accelerate Economic Opportunity in San Francisco
$500,000 Investment in core operating support will enable Social Finance to support Bay Area governments to reduce homelessness
San Francisco, CA (April 26, 2018)–The Citi Foundation announced that Social Finance was selected as the recipient of a $500,000 grant as part of the 2018 Community Progress Makers Fund. The Fund is a $20 million, two-year initiative by the Citi Foundation to support high-impact community organizations that are driving economic opportunities in our communities by bringing together residents, nonprofits, businesses, and municipal agencies. Social Finance joins a group of 40 change agents who are playing a key role in coordinating the efforts of multiple partners toward common goals and working in new ways to address urban challenges in Chicago, Los Angeles, Miami, New York City, San Francisco Bay Area, and Washington D.C.
Through the fund, Social Finance will support Bay Area governments to develop outcomes-based contracting models to reduce homelessness and measurably improve the lives of those in need.
These models offer governments a new way to fund social programs, ensuring that taxpayer dollars are spent only on programs that successfully deliver results. Instead of simply paying for services, governments define the outcomes they are trying to improve—and how progress in those outcomes will be measured over time—and only pay if they’re achieved. Through these models impact investors often provide up-front capital to grow promising programs and are repaid only to the extent that those programs achieve pre-determined goals for improving people’s lives.
“As a Community Progress Maker, we will unite government, impact investors, and nonprofits in San Francisco around the common goal of reducing chronic homelessness,” said Tracy Palandjian, CEO and Co-Founder of Social Finance. “We will tackle this pressing social challenge, using a new public finance model called Pay for Success to set performance goals, mobilize private capital, and track results.”
On any given night over 13,000 individuals are homeless in San Francisco and Alameda Counties. This is an individual tragedy but it is also costly to communities. These costs accrue to the counties, cities within them, the state, and the federal governments; local businesses; and to the homeless themselves. Estimates in San Francisco suggest that chronic homelessness costs more than $80,000 per person each year in health care, jail, and other expenses.
“Homelessness is a hugely complex challenge,” said Jake Segal, Vice President and head of Social Finance’s California office. “But it’s also among the most critical moral and financial imperatives our state faces today. New partnerships, and deep accountability for results, could make a real difference.”
There’s growing political will in the Bay Area to accelerate real change around homelessness. As a Community Progress Maker, Social Finance will build on our work addressing chronic homelessness in communities from Rhode Island to Central Texas, helping the area’s strongest nonprofits and service models reach scale and engaging leaders across the public, private and nonprofit sectors.
“We launched this program in 2015 as our version of ‘venture philanthropy’ – a chance to invest in the vision and mission of these organizations who are helping positively transform their communities,” said Brandee McHale, President of the Citi Foundation. “We’re pleased with the results from our inaugural Community Progress Makers and are looking forward to implementing the lessons we’ve learned with this next, impressive group of community leaders as they scale, innovate and drive impact.”
In 2016-2017, the inaugural cohort of Community Progress Makers helped more than 14,700 low-income people secure financial assets; built over 10,500 affordable housing units; strengthened more than 1,100 small businesses; and connected 1,800 young people to jobs in their communities.
About Social Finance
Social Finance is a 501(c)(3) nonprofit organization dedicated to mobilizing capital to drive social progress. Social Finance is committed to using Pay for Success to tackle complex social challenges, facilitate greater access to services for vulnerable populations, and direct capital to evidence-based social programs – all with the goal of measurably improving the lives of people most in need. Social Finance has deep experience in the design and implementation of Pay for Success projects, from early-stage feasibility assessment, to project development and capital formation, to post-launch performance management and investment support. Social Finance’s sister organization, Social Finance UK, pioneered the first social impact bond in the world.
About the Citi Foundation
The Citi Foundation works to promote economic progress and improve the lives of people in low-income communities around the world. We invest in efforts that increase financial inclusion, catalyze job opportunities for youth, and reimagine approaches to building economically vibrant cities. The Citi Foundation’s “More than Philanthropy” approach leverages the enormous expertise of Citi and its people to fulfill our mission and drive thought leadership and innovation. For more information, visit www.citifoundation.com.
Director of Communications, Social Finance