Capital Action Team

Problem Statement

  • Existing firms and potential entrepreneurs require access to capital and a strong network of business services—both are currently inadequate.
  • More connection between various investors and investment opportunities need to be coordinated, region by region. There are gaps in the financial ecosystem and more intermediaries are needed throughout the financial continuum for all types of investments and all types of capital.
  • Impact investors and local residents interested in targeting specific regions, industries or firms lack effective intermediaries.

Goal Statement

  • Identify gaps, eliminate barriers, and establish appropriate intermediaries to increase access to capital.
  • Target investments that generate economic as well as social and environmental returns to California communities.

Action Team Co-Leads

  • Greg Wendt, Stakeholders Capital
  • Marc Nemanic, 3CORE
  • Seth Wilson, Cutting Edge Capital

For a full list of Action Team members, click here. For the team’s 2012 accomplishments, see the Summit’s 2013 Year-End Summary Report.

Tracking Progress

Action Team

Goals for the Year

Progress update - September 1, 2015

Priority action identified in Summit Plan to Advance Prosperity in 2014:

Identify and explore ways of using capital intermediaries that can close gaps in access to capital in all of the state's regions.

Create regional maps of intermediaries (including, for example, types of data proposed in recent state efforts to direct triple-bottom-line investments to underserved communities). Distribute to regions.

Prototype and replicate products and platforms that increase capital investment in underserved regions, including non-metro areas.

Update - December 16, 2014 Create regional maps & prototype platforms: The Capital team submitted a request for proposals to regions interested in becoming ""living laboratories"" for improving access to capital by mapping investing intermediaries. The team will select three regions to serve as pilots for this effort in early 2015. Update - November 14, 2014 Create regional maps & prototype platforms: The Capital team joined CA Fwd and the White House's ""Investing in Manufacturing Communities Partnership"" in co-hosting an event on how the Summit can support efforts to grow the impact economy in California. In the meeting, private investors and leaders from the public and nonprofit sectors organized themselves into action teams that will work to expand the number of ""for-benefit"" corporations in the state, while also widening use of ""Pay for Success"" models to support public programs. Update - July 2, 2014 Create regional maps: The Capital and Working Landscapes teams met in July with representatives of several federal agencies and statewide small business associations, who offered to support the development of a database of information about regional capital intermediaries. State groups present included the California Small Business Association, California Association for Micro Business Opportunity, and California Association for Local Economic Development, as well as several potential federal partners. Prototype platforms: Economic development groups operating in California’s 22 northernmost counties have formalized a three year-old collaboration that has allowed them to increase the scale and reach of their capital and technical expertise. Together, the new California Finance Consortium will serve as a regional source of information on accessing capital for small businesses in northern California. The group is seeking seed money to begin mapping sources of capital in the region. Update - June 16, 2014 Create regional maps: Leaders of the Capital and Working Landscapes action teams have scheduled a meeting in July with representatives from several federal agencies and statewide small business associations to seek agreement on the best approach to building--and maintaining--a repository for information about regional capital intermediaries, as well as creating a template for each region to use to ensure this information is in a similar format. Participants in the meeting include the California Small Business Association, California Association for Micro Business Opportunity, and California Association for Local Economic Development, as well as several potential federal partners. Update - April 5, 2014 Create regional maps: The team's leaders are identifying a group of 5-10 team members to map capital intermediaries. Capital team members are also participating in a meeting organized by the Infrastructure team in Los Angeles--hosted on May 16 by the Southwest Megaregion Alliance--that will bring Southern California infrastructure experts together to begin develop a pipeline of projects. Prototype platforms: Summit participants are working to develop a regional ""community capital collaborative"" for Northern California, hosted in Yuba City.
Capital Team's 2013 Action Plan

1. Create inventory of capital intermediaries in regions throughout California.

Identify the intermediaries currently operating in each region and identify gaps in capital needed and/or new intermediaries, Investment categories for discussion include:
• Early-stage entrepreneurs.
• Later-stage equity and private-equity investing.
• Working capital and mezzanine loans.
• Revenue bonds, Credit Enhancements, Infrastructure financing.

Update - July 2, 2014: See update above November 8, 2013 Summit commitments:
Fourteen individuals made commitments to support or launch mapping efforts, aimed at identifying existing financial intermediaries as well as gaps in access to capital in regions across California: • Regional mapping efforts will move forward in the Inland Empire, Los Angeles, Ventura, Bay Area and Sierra Nevada. • A consistent template will be developed to record information on intermediaries including markets served and financial services provided. Augmenting mapping efforts, several individuals committed to raising awareness of sources of capital in California by: • Hosting webinars and workshops on various capital sources. • Improving regional knowledge of state programs to assist with small business lending. Several individuals made commitments to increase new sources of capital by: • Supporting the potential California Community Investing Initiative (AB 495) to direct triple -bottom-line investments to low-income communities. • Connecting international impact investing efforts with California needs. • Supporting platforms to reduce microloan transaction costs.

2. Assess capabilities and shortcomings of existing intermediaries and identify gaps in access to capital.

Convene or join regional team to conduct comprehensive regional assessment of operating intermediaries and gaps.

Update - July 2, 2014: See update above

3. Map needs for new intermediaries which can be formed and deploy capital in the next 12-24 months.

Develop working network of intermediaries that meet needs of businesses and industry clusters in regions across California.

Update - July 2, 2014: See update above