Dealflow | January 21, 2020

Citi deploys bank capital in $150 million impact fund

Jessica Pothering
ImpactAlpha Editor

Jessica Pothering

ImpactAlpha, January 21 – It’s the kind of impact strategy you often see from private equity firms, not banks. Citi’s is launching a new $150 million impact fund that will make direct equity investments in early and growth-stage companies.

The Citi Impact Fund will cut checks of up to $10 million for companies addressing workforce development, financial inclusion, sustainable energy and water use, and high-impact infrastructure, like housing, healthcare and transportation. Women and other underrepresented founders will be a key focus of the fund.

Citi will use its own capital to make the investments. 

Outside of renewable energy financing, most of Citi’s impact initiatives until now have stemmed from its foundation, such as its City Accelerator initiative, in partnership with Living Cities, to identify ways to close urban infrastructure finance gaps. 

Other banks are using philanthropic dollars to catalyze and derisk lending in high-need communities. JPMorgan Chase has earmarked more than $500 million for city-based funds, following the success of a $100 million commitment to Detroit in 2014. That resulted in an additional $50 million in commercial investments in the city three years later.