By: Casey J. Bell, Jesus Diaz, & Alejandro Carrillo Teniente
One year ago, Pacific Community Ventures launched our Climate Resilience Mobilization Fund with a vision for a climate economy that creates opportunity, cultivates local resilience, and values fairness through economic transition across the state of California where PCV invests. In that year, we’ve deployed $1.75 million in loans from the anchor $3m investment we raised, with $1.5 million in immediate pipeline and growing, to support our small business clients in reducing operating costs alongside emissions, and ensuring equipment installers and contractors have working capital solutions to participate in projects that improve building performance and infrastructure.
It is undeniable that the landscape for capitalizing such investments is evolving. Yet, we must remember: the promise of good jobs and economic mobility pathways opportunities through climate-related investment predates the catalytic promise of the Greenhouse Gas Reduction Fund. While the fate of federal funds remains uncertain at the time of writing, we remain steadfast in developing markets, cultivating pipelines, and delivering solutions that make our communities healthier, safer, and more economically competitive.
Community Development Financial Institutions (CDFIs), and impact investors like PCV, continue to have a unique opportunity through climate-related investments to demonstrate our resilience and show what’s possible when we center thriving community outcomes in capital deployment. A few key principles can guide our way:
1.Data is a Lens, Not Just a Dashboard
In our first year of climate-related lending, we realized it can be self-limiting to view data solely as a tool for measuring impact – when we could be harnessing it to develop markets. As we honed our fund thesis, we began asking powerful questions around where climate burdens intersect with economic activity, and where business support systems like CDFIs and small business development centers are, and are not, present to support climate adjacent businesses.
In addition to leveraging our existing partnerships in the Greater Bay Area and Greater LA regions, we’ve developed a forward-looking eye for relationship-building to support ecosystem strengthening and market development throughout California, particularly in the Central Coast; as well as the Riverside and Imperial Valley communities. We know from regional economic development plans across the State there may be opportunities for our Fund to support regenerative AgTech in supply chain development. We are looking forward to working with our new partners, the Monterey Bay Economic Partnership (MBEP), to establish a foundation in the Monterey, San Benito, and Santa Cruz counties in their pursuit of this economic innovation and competitiveness endeavor. And in Riverside and Imperial Valley, we are working to support manufacturing and contractors critical to economic growth catalyzed in part by the Lithium Valley economic boom.
While sectors like AgTech and lithium mining present environmental trade-offs, we’re committed to ensuring that the economic activity —both direct and indirect— generates local and sustained community benefits, and that we catalyze investment aligned with climate resilience and long-term sustainability. That means funding businesses and partners working to green these value chains, reduce their footprints, and build inclusive, low-carbon futures from the ground up, all while building local community financial health and ownership.
2.“Doing Green” Is Critical to “Going Green”
When we designed the Climate Resilience Mobilization Fund, it was critical that the strong, local community of small business owners we work with have access to the economic opportunity created by climate projects. In many ways, we are working to fill the “pre-development gap” that is inherent in past instances of climate investment. Small businesses coming through COVID, inflation, supply-chain disruption and now coping with tariffs can face significant cash flow challenges excluding them from pursuing growth opportunities. This means that large-scale systems investment favors larger established firms over smaller businesses and new market entrants.
PCV client New Found Growth Corporation came to PCV through our partner Merriweather & Williams Insurance Services for a contract-based loan ($50,000) to complete a sustainable roofing project for the San Francisco Housing Development Corporation. A well-insulated roof can reduce greenhouse gas emissions by lowering a building’s energy consumption for heating and cooling. Without a PCV loan, Pierre Middleton-Baez would have struggled to deliver on a “Good Jobs” promise as the funds were critical to sustain payroll and operations until project completion. Traditional financing options were unavailable or too inflexible to be healthy for the business, but post-loan Pierre has also secured additional projects and has since been able to take on an additional low-cost $200,000 working capital loan from PCV to finance a roofing project’s materials & equipment!
3.Fund Innovation Attracts Capital Catalytic
There is no denying that the $29 billion in federal funding through the Greenhouse Gas Reduction Fund, would be massively catalytic. Still, our team at Pacific Community Ventures does not lack imagination when it comes to unlocking non-traditional sources of capitalization and designing for impact. Our pioneering place-based impact-first Restorative Loan Funds in Oakland came out of principles of human centered design, and democratizing access to capital and governance by co-creating the fund with several local partners. Similarly, this Fund was born out of listening to our community and partners and contractors across the State on their challenges to access working capital to be part of bidding and contracting opportunities in front of them. With their feedback and collaboration, our team designed this catalytic fund to meet their pre-development needs and solve a real capital pain point for them. 100% of our fund is currently private investment, and we are committed to telling the stories that demonstrate the immense investment-readiness of our clients who are too often denied access to traditional financing channels that support their growth and financial health.
We are grateful to our private impact investors for seeing this Fund as a natural extension of the good jobs investing journey we articulated in our Fund Thesis, and for committing to a vision of a thriving California Climate Economy that makes our state more resilient, believes in the potential for small business to shape the future, and creates good and green jobs in the process.
4.We Are Patient with our Capital
The Climate Imperative remains urgent, and in today’s business environment, the concept of patient working capital has never been more relevant for small businesses transitioning to the climate economy or greening their business. These small business owners aren’t simply addressing commercial opportunities, but they are building the foundations for tomorrow’s economic landscape and creating good jobs in our local communities.
At PCV we understand that a sustainable economic transformation doesn’t happen overnight. We support businesses pioneering climate related solutions because they experience extended development and commercialization cycles, regulatory hurdles, and customer education challenges that conventional investors fail to accommodate. And in addition to our patient capital, we also bring quality pro bono mentorship support to coach small business clients in their procurement, HR, operations, strategy, marketing, and other skills to ensure the success and resilience of their growth.
Transformative policies like the Greenhouse Gas Reduction Fund have the potential to be massively catalytic, but we are not waiting for them to move the needle, and we understood that they were not going to be able to meet the pre-development gap we see for too many of our small business clients. Instead, we’re investing now in community visionaries who are going to shape our climate, energy, and agricultural future.
We’re in this for the long haul. Reach out to Casey Bell. PCV Chief Impact Officer, at cbell@pcvmail.org, to learn more about how you can invest in, or volunteer as a small business advisor, to support PCV’s Climate Resilience Mobilization Fund and the entrepreneurs we’re helping access the climate economy!