Impact(ed)

Our second Impact(ed): Live! conversation explored what employers, funders and impact investors can do differently if they actually want to widen pathways into the field.

In 1984, community banks numbered 15,767 and held 39% of U.S. banking assets. By 2024, only 4,128 remained, holding 11%. The "big four" now control $9.5 trillion in assets but lend out only 41% of it, versus 70% for community banks. This episode asks what got lost — and what rebuilding it takes.

PART ONE: THE CASE FOR LOCAL BANKING
Journalist Oscar Perry Abello unpacks his book The Banks We Deserve. His core argument: community development finance isn't a newer field bolted onto banking — it's what banking used to be, before consolidation moved lending decisions away from the neighborhoods they serve. Community banks hold $153 billion in construction loans versus $51 billion at the big four. Abello cites Adelphi Bank in Columbus, Ohio — chartered in 2023, the first new Black-designated minority depository institution (MDI) in 20 years — which turned $27 million in startup capital into $100 million in community investment within three years, and Redemption Bank in Utah, formerly Holladay Bank and Trust, now Black-owned after investors acquired and rebranded it. Of roughly 3,900 community banks left nationwide, only about 125 are MDIs.

"Getting things done at scale in this country has always taken community banks, local banks, local credit unions to actually do all this work."

Abello explains how these institutions fund growth: equity (roughly $1 for every $10–11 in deposits), deposits, and wholesale borrowing through the Federal Home Loan Bank system, built in the 1930s for this purpose. His metaphor: an impact fund waters one tree in a burned forest; rebuilding banking policy seeds rain clouds that water the whole forest.

PART TWO: COMMUNITY DEVELOPMENT ON THE GROUND
Jacqueline Waggoner, newly installed president and CEO of Century Housing, a California CDFI that has deployed $3.5 billion to create or preserve 60,000+ homes, joins next. She previously led Enterprise Community Partners' Solutions Division, helping design the Local Rental Owners Collaborative (LROC) — a 2021 South LA program pairing small, often Black and Latino landlords owning 2–20 units with rent relief and property support, keeping affordable housing out of corporate hands.

Century grew out of the Century Freeway (I-105), whose construction displaced 7,000 homes and 21,000 LA residents — a reminder that community development often means redressing harm from past infrastructure decisions. Her underwriting centers on relationship and character: decades of history with the same borrowers, and attention to "the souls behind the doors."

The episode closes on policy: the proposed FY2027 federal budget would cut CDFI Fund awards by 63% (over $200 million), shrinking the fund from $324 million to about $119 million. Both guests frame CDFIs and community banks as core infrastructure, not niche impact vehicles.
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GLOSSARY:

• CDFI (Community Development Financial Institution): Federally certified lender focused on underserved communities.
• MDI (Minority Depository Institution): A bank majority-owned by minority individuals, or with a majority-minority board and customers.
• Community Reinvestment Act (CRA), 1977: Requires regulators to ensure banks meet credit needs of low- and moderate-income neighborhoods.
• Equal Credit Opportunity Act (ECOA), 1974: Barred credit discrimination; before it, a woman generally needed a husband present to get a loan.
• Redlining: Denying loans to residents of specific neighborhoods, typically by race, via lending maps.
• Federal Home Loan Bank (FHLB) System: A 1930s wholesale lending network funding member banks beyond local deposits.
• Character-Based Lending: Underwriting that weighs a borrower's relationships and community standing, not just credit metrics.

The built environment accounts for ~37% of global CO₂ emissions, 41% of global energy use, and 42% of landfill waste. Over 22 million U.S. households spend more than 30% of their income on rent. This episode asks: why isn't more capital flowing here to make our housing affordable and sustainable?

The Institutional Turn:

Cole Cage (Jonathan Rose Companies) argues affordable housing has matured into a core institutional asset class. Government-backed Section 8 HAP contracts, a 7-million-unit housing shortage, and durable renter demand make it a stable, low-volatility investment — not a concessionary one.

"The best investments are ones where impact is inherent to the product itself."

The Capital Gap:

Ruby Schifrin (Joist / Turner Labs) identifies a structural trap: housing tech startups are too regulated for generalist venture, too early for real estate capital, and too complex for software investors. Joist — Turner Labs' new venture fund — targets this gap, backing modular construction, financing tools, and AI-powered permitting software. Meanwhile, philanthropic capital that should be taking early risk is crowding into the same proven plays as institutional investors.

"If you take a venture model to philanthropy, you should expect 90% of your businesses to fail. Yet in the impact space, people think any failure means they're doing something wrong."

What Makes It Expensive — and the Call to Action:

Well-intentioned regulations pile up into a crushing burden. Ruby proposes a "menu model" — let developers pick three public benefits from a defined list rather than mandating all of them. Cole flags Davis-Bacon prevailing wage rules as a separate 40% labor cost driver on federally funded projects. Jonathan Rose Companies' approach: listen to communities before proposing anything, then unlock government resources to fill the gaps. The closing ask — developers: try the deal you assumed wouldn't pencil. Investors: revisit affordable housing on a risk-adjusted basis. Individuals: go to a local community meeting. The roadmap exists — what's missing is more people deciding this is their problem.

GLOSSARY:

• AMI: Area Median Income — HUD's benchmark for affordability. Housing is "affordable" when a household pays ≤30% of income on rent. Programs target different thresholds (30%, 60%, 80%, 100% AMI).
• Capital Stack: All financing layers in a deal (equity, debt, tax credits, grants) ordered by repayment priority. Affordable housing stacks typically involve 5–8 sources.
• Cost-Burdened: Spending >30% of gross income on housing costs. "Severely cost-burdened" = >50%.
• Davis-Bacon Act: Federal law (1931) requiring prevailing wages on federally funded construction — can add ~40% to labor costs in high-wage cities.
• HAP Contract: Housing Assistance Payment contract — HUD pays the gap between tenant income and market rent under Section 8, providing stable government-backed revenue.
• LIHTC: Low-Income Housing Tax Credit — the primary federal subsidy for affordable rental housing. Developers sell credits to investors to generate project equity; units must stay affordable for 30+ years.
• Workforce Housing: Housing for households earning 60–120% AMI — too much for deep-subsidy programs, too little for market-rate in high-cost cities. Often supported by tax relief rather than direct subsidy.

Impact(ed) co-host Lucas Turner-Owens sat down with Eric Horvath and Shuvam Rizal to unpack their first-of-its-kind research: analyzing broad-based demand for impact-first investing careers from candidates who do not come from MBA programs and traditional financial institutions.

Eric and Shuvam shared findings and observations based on more than 250 respondents, including analysis and trends on who's interested in these jobs, how much experience they have, and what they feel are major blockers to employment.

This was the first of two sessions exploring this topic. The second -- to be hosted in September -- will focus on ways employers and field-builders can think about expanding career pathways for this abundance of talent.

Be sure to follow Impact(ed) on Substack for more.

This exploration is supported by Tufts' Certificate in Impact and Sustainable Investing (CISI) and Untapped Capital Consulting.

Private equity can feel as though it has always existed—a permanent villain of the investment industry. But it hasn’t.

The modern industry is only a few decades old, younger than some of the people now sitting on pension and endowment committees deciding how much of it to hold.

PE grew around a specific thesis: that patient, controlling ownership could counter the short-termism of public markets and create genuine value, not merely generate financial returns. Today, that thesis is being tested from two directions at once. A multitrillion-dollar asset class must demonstrate that enough real opportunity remains to justify its enormous scale. At the same time, a higher-cost-of-capital environment is stripping away the cheap debt that helped make many of its past returns possible.

So what happens when financial engineering is no longer enough? What does PE look like when returns must come from actually building better businesses? And as private ownership reaches further into the institutions that shape our daily lives, who gets to decide what those businesses are ultimately designed to produce—and for whom?

Smitha Das is Senior Director of Investments at World Education Services (WES), where she leads the investment practice and is helping steer the organization’s full balance sheet toward mission alignment. She is an unusually credible voice on this topic because she has sat on nearly every side of the table. She began her career at an infrastructure PE fund, later worked as an intermediary, and now allocates capital as an asset owner.

Rodney and Eric sat down with her for a conversation that resists the easy version of the PE debate and instead examines the mechanics through which value—or harm—is actually created.

• Daycare centers, nursing homes, local newspapers, and youth sports leagues—the everyday institutions now owned by PE that many people assume are still locally controlled.
• The two versions of PE WES holds at once: a “current-state” portfolio, where the organization pushes incrementally for better incentives, governance, and structures within the existing playbook; and a “catalytic portfolio,” where it is testing entirely new models of ownership and governance.
• PE as a tool and a set of design choices, rather than an inherently good or bad asset class—and why incentives, governance, and investment structure are the three levers that most directly shape outcomes.

Definition: An investment model in which a firm raises capital from institutional investors to acquire controlling stakes in companies—usually private companies, though sometimes publicly traded companies that are taken private—with the intention of holding, improving, and eventually selling them for a return.

Why it matters: Much of the public debate treats PE as either a monolithic villain or an unqualified engine of growth. But because the ownership model is so flexible, “Is private equity good or bad?” is the wrong question. The more useful question is: what are a particular firm’s incentives, governance, and investment structure designed to produce?

Definition: A strategy in which a firm acquires multiple companies within the same industry or geographic region and combines them under shared ownership, often to gain scale, reduce costs, or control a larger share of a market.

Why it matters: Roll-ups can be difficult to detect. A consolidated daycare chain may continue operating under its original, locally recognizable name even after ownership has changed. That opacity makes the resulting loss of competition—and the decisions that follow—harder for affected communities to trace back to the actual owner.

AI-generated wealth could unlock tens of billions in new annual philanthropic spending over the next decade. So why does Jed Emerson think the real question isn't how fast that money moves, but what it's actually for?

Jed Emerson is one of the longest-standing voices in impact investing and the originator of the "blended value" framework — but he didn't come up through a trading desk or a venture fund. He started in social work, ran the Larkin Street Youth Center in San Francisco, and helped launch REDF (now Redefine Alliance) with KKR co-founder George Roberts, making it one of the first venture philanthropy funds in the country.

Rodney and Lucas sat down with Jed for a wide-ranging conversation on where the field got stuck, and what decades of this work have actually taught him.

We talked about:

• Why "doing good vs. doing well" is a false choice, and what it costs the field to keep asking it
• Why Jed stopped starting with structure — grant, debt, equity, hybrid — and started with purpose instead
• Microfinance as a case study in how philanthropic capital gets mispriced as "risky" until it isn't
• Whether a new wave of AI-driven philanthropic wealth will reproduce old patterns of concentrated ownership, or actually build shared agency
• Jed's shift from "being the rock to being the river," and what that means for a field addicted to its own frameworks

GLOSSARY:

Blended Value
Technical: The idea that all capital and all enterprises generate a mix of economic, social, and environmental value simultaneously — value isn't separable into a "financial" bucket and an "impact" bucket.

In practice: Jed's framework rejects the premise that you have to choose between a grant and an investment, or between mission and return. Every dollar deployed is already doing all three kinds of value-creation at once, whether or not anyone is tracking it.

Why it matters: Once you accept blended value, the question stops being "is this concessionary or market-rate?" and becomes "what value are we actually trying to create, and for whom?" That reframing is what lets the right tool — grant, equity, guarantee, hybrid — follow the purpose instead of the other way around.

Absorptive Capacity
Technical: The ability of a field, sector, or set of institutions to effectively deploy a given amount of capital — measured in things like grantmaking staff, due diligence capability, and institutional infrastructure.

In practice: If AI wealth adds tens of billions in new annual philanthropic spending, someone has to actually move that money well: more grants, more allocators, more operating talent, more institutions capable of doing it with speed and discipline.

Why it matters: Jed pushes back on treating this purely as a technical staffing problem. Capacity is also a power problem — plenty of organizations already have the ambition and trust built up in their communities, but lack flexible, patient capital. Asking "do we have enough capacity" without asking "whose capacity are we willing to see" risks building new infrastructure around the same old gatekeepers.

George Suttles is a longtime investment committee member and adviser to philanthropic institutions, with deep experience helping boards think differently about investment stewardship, fiduciary responsibility, and who belongs in the room.

Rini Banerjee is a pioneer in mission-aligned endowment strategy, having spent over a decade helping foundations use their investment policy statements as tools for values alignment—long before most advisors understood what she was asking for.

Together, they brought a rare combination of insider knowledge and strategic challenge to this conversation. George has sat on committees and helped build them. Rini has used the IPS as an organizing document to pull investment committees up from manager selection and into mission. Between them, they helped us understand what investment committees actually do, why they matter more than most people realize, and what it would take to change who sits at the table.

GLOSSARY:

Investment Policy Statement (IPS)

Technical:

A written document that establishes the goals, guidelines, and constraints for managing an organization’s investment portfolio. It typically covers asset allocation targets, risk tolerance, liquidity requirements, and sometimes values-based restrictions.

In practice:

Most foundations have one. Most board members have never read it. Rini has spent years treating the IPS not as a compliance document but as an organizing tool—a way to force the strategic and values conversation that should be happening at the investment committee level but rarely does. When a committee rewrites its IPS through a mission lens, it has to confront the question: what is this endowment actually for?

Why it matters:

The IPS is the rulebook. Change the rulebook, and you change what’s possible. A mission-aligned IPS can open the door to impact investments, ESG screens, and community capital strategies that a default document would never contemplate.

Fiduciary Duty

Technical:

A legal and ethical obligation to act in the best interest of the beneficiary—in this case, the foundation and its mission—rather than in one’s own interest or the interest of any third party.

In practice:

Investment committee members are fiduciaries. That means they can be held legally liable if they make decisions that benefit themselves rather than the institution. For a long time, fiduciary duty was used as an argument against mission-aligned investing: the duty, the argument went, was to maximize financial returns, full stop. That argument has been substantially challenged and largely discredited—but it still comes up, and it’s still used to resist change.

Why it matters:

Understanding fiduciary duty is essential to understanding both the power and the constraints of the investment committee role. It’s also useful for pushing back on the claim that pursuing mission alignment is somehow legally risky.

Are There Too Many VCs in Impact Investing? The Real Answer Is More Complicated than a Yes or No.

Ben Thornley is co-founder and managing partner of Tideline, one of the field’s leading research and advisory firms on impact investing. He’s not an investor—he’s the person that the largest limited partners in the world, institutions managing hundreds of billions in assets, call when they’re trying to make sense of a market they don’t fully understand yet.

His answer: the problem isn’t too much VC. It’s not enough of everything else. The capital stack in impact investing is barbelling—institutions piling into later-stage, more proven strategies while early-stage impact sits overcrowded and without much liquidity

EPISODE GLOSSARY:

Barbelling

Technical: A distribution pattern in which capital concentrates at two extremes of a spectrum, leaving the middle relatively underfunded.

In practice: In impact investing, institutional capital is flowing heavily into later-stage, more proven strategies (large private equity funds, public equities with ESG screens) and into very early-stage philanthropic work—while the middle (growth-stage impact, fund II and III managers) goes undercapitalized.

Why it matters: The companies most ready to scale—past proof of concept but not yet large enough to attract big institutional mandates—are exactly where the gap sits. Barbelling explains why the field can feel both overcrowded and underfunded at the same time.

Secondary Markets

Technical: Markets where investors buy and sell existing stakes in private funds or companies, rather than investing directly into new deals.

In practice: If you’re an LP in a private equity fund and you need liquidity before the fund winds down, you sell your stake to another investor on the secondary market. In conventional private equity, this market is large and well-developed. In impact investing, it barely exists—Ben noted you can count impact secondary funds on one hand.

Why it matters: Without a secondary market, every impact investment is effectively locked up until exit. That illiquidity premium makes impact structurally more expensive to hold than conventional alternatives, which rational institutions will price accordingly.

Concessionary Capital

Technical: Capital that accepts below-market financial returns in exchange for social or environmental impact.

In practice: Think of a foundation that invests in an affordable housing fund knowing the returns will be lower than a comparable market-rate fund—because the goal is to produce housing, not just profit. The ‘concession’ is the financial return the investor foregoes.

Why it matters: The field debates how much concession is appropriate—or required—for genuine impact. Ben’s view is that the impact investing community has sometimes made this debate more binary than it needs to be, excluding strategies that produce real impact but don’t meet a specific return threshold.

Lacking Liquidity

Technical: A state in which a market or asset class lacks sufficient liquidity mechanisms (secondary markets, structured exits, revolving credit facilities) to meet investor demand. In practice: An impact fund manager trying to return capital to LPs who need liquidity has very few options compared to a conventional PE manager. There’s no robust secondary market to sell into, fewer structured products to access bridge capital, and fewer exit pathways in general.

Why it matters: A lack of liquidity compounds over time. It makes the asset class less attractive to institutions that need to manage liquidity risk—which restricts the pool of potential LPs, which limits fund size, which limits what managers can do

Only 10% of retail investors say they want expanded access to private markets. So why is the entire industry pushing for it?

On the latest episode of Impact(ed), we sat down with Ian Fuller (Westfuller Advisors) and Ben Schiffrin (Better Markets) to unpack what’s actually happening as firms like Blackstone, Apollo, and KKR make their push into 401(k) accounts.

We talked about:

• The new Department of Labor guidance creating a ‘safe harbor’ for private market investing in retirement plans—and why removing fiduciary liability changes everything
• Why the democratization framing deserves real scrutiny—and who’s doing the framing
• What the fee math actually looks like when you put 2-and-20 next to a Vanguard index fund
• The liquidity trap: what happens when everyday investors can’t get their money out

GLOSSARY

Accredited Investor

Technical: A person or entity that meets the SEC’s wealth or income thresholds—currently $1M net worth (excluding your home) or $200K annual income ($300K for couples).

In practice: The legal standard used to determine who can access private market investments. The idea is that accredited investors are sophisticated enough to fend for themselves without the protections that apply to public offerings. The thresholds haven’t kept pace with wealth concentration, which means a lot more people technically qualify now than the rule originally imagined.

2-and-20

Technical: The standard fee structure for private market funds: a 2% annual management fee on assets under management, plus 20% of profits (called ‘carry’ or ‘carried interest’).

In practice: Compare that to a Vanguard S&P 500 index fund, which charges roughly 0.03%. For every $100,000 invested, you’re paying $2,000/year in management fees before the fund has done anything—plus a fifth of any gains. Ian was direct: funds with this fee structure don't consistently produce better outcomes than passive investing.

Liquidity / Illiquid

Technical: Liquidity refers to how quickly and easily you can convert an investment into cash. Illiquid investments can’t be sold quickly—you may need to wait months, years, or until a specific exit event.

In practice: Index funds and ETFs in your 401(k) are highly liquid—you can sell them and get your money in days. Most private market funds are illiquid. Some ‘semi-liquid’ private credit funds cap redemptions at 5% per quarter, meaning if you need your money and others do too, you may simply be told to wait. Ben noted that redemption requests at some private credit funds are currently exceeding that 5% limit.

Why it matters: Retirement accounts aren’t always held until retirement. People dip in for emergencies. Illiquid assets in a retirement account mean you may not be able to get your money when you need it.

Safe Harbor

Technical: A legal provision that protects a party from liability if they’ve followed a specific set of rules or procedures, even if the outcome is bad.

In practice: The Department of Labor’s proposed rule would create a safe harbor for 401(k) plan managers who follow certain steps before investing in private markets. If they follow the process, they’re shielded from lawsuits—even if the investment performs poorly. Ben’s concern: the guardrails in the safe harbor may not be sufficient to actually protect retail investors, especially those who don’t have access to a sophisticated advisor to ask the right questions on their behalf.

Why it matters: Safe harbors can be appropriate policy tools. But they can also shift the risk from institutions (who can absorb it) to individuals (who often can’t). That’s the core tension this episode kept returning to.

Alicia DeLia of DeLia Impact Advisors joins the pod this week to talk about raising both grants and impact-first investments. Alicia shares why she’s passionate about getting capital to communities; how she supports leaders from diverse backgrounds to create authentic relationships with wealth holders, so fundraising doesn’t feel so transactional; and the importance of being an optimist.

Timestamps:

• 00:00 Breaking Down Silos in Impact Investing
• 01:04 Understanding Fundraising in Impact Investing
• 03:54 The Role of Investor Relations
• 04:59 Alicia DeLea's Journey into Fundraising
• 09:00 Resource Mobilization in Impact Investing
• 11:58 Mindset and Self-Belief in Fundraising
• 15:57 The Importance of Asking for More
• 17:01 Defining Grants vs. Impact Investing
• 20:09 A Week in the Life of a Fundraiser
• 22:00 Transferable Skills in Fundraising
• 25:58 The Power of Convening
• 29:10 Advice for Future Fundraisers

Links:

• Alicia’s Linkedin
• DeLia Impact Advisor’s website