Greetings Agents of Impact!
This week’s Call: Municipal impact investing for shared prosperity (see below). Can philanthropic bond guarantees expand access to capital for smaller cities and rural areas? Join Lourdes Germán of Public Finance Initiative, Michael Gaughan of the Vermont Bond Bank, Damon Burns of Finance New Orleans, Eric Glass of Clarion Call Capital and Brian Boland of Delta Fund, for this week’s Agents of Impact Call, Wednesday, Dec. 17, at 10am PT / 1pm ET / 6pm London. RSVP here.
In today’s Brief, we’re kicking off our series of roundups of our 2025 coverage:
- Assembling a playbook for shared prosperity
- New – and bigger – funds to finance transitions to employee ownership
- Making municipal bonds more accessible and affordable for small cities and rural communities
Featured: Investing in Shared Prosperity
Beyond affordability to ownership, wealth-building and economic security. Affordability is only the beginning. If creating an abundance of affordable housing, healthcare, energy and transportation was the animating issue of the year, expanding access to ownership of appreciating assets and other wealth-building opportunities is likely to be high on the agenda in 2026. To help focus that agenda, ImpactAlpha has been assembling a “playbook for shared prosperity” with examples of strategies and initiatives that build wealth, support families and restore communities (submit your favorite initiatives – or your own – through this simple form). In the first in our series of roundups of ImpactAlpha’s coverage, it’s clear that fair sharing of the prosperity that comes with innovation and economic growth is both an urgent policy priority and a compelling investment opportunity.
- Appreciating assets. The “baby bonds” included in this year’s tax and budget bill, which give newborns – born through 2028 – $1,000 in federal funding are a down payment on a long-held priority for asset-building advocates (see also, “Stackwell seeks to help young investors start to compound their wealth early”). There is also increasing bipartisan support for policies to expand transitions to employee ownership, especially as millions of baby boomer business owners prepare to retire (see below). And new financing mechanisms are expanding access to home ownership in ways that can be fair to both borrowers and investors (hint: it’s not the 50-year-mortgage). There is increasing attention to ways to protect existing home owners as well, from expensive repairs, rising taxes and utility bills and predatory lenders. “Creating prosperity for all is really front and center on the minds of people across the country. Home ownership is one of the pillars, and it’s just out of reach,” Utah investor Jim Sorenson told ImpactAlpha last month.
- Purple power. A rising economic tide for all and increased financial security for US families could go a long way to healing the artificial divisions plaguing the country. In both the spring and the fall, ImpactAlpha criss-crossed the country to discover strategies that are working in rural and urban areas and in red and blue states (find a sampling here, here, and here). “We needed this,” more than a few people said after the screening of our award-winning mini-documentary, “Equity and Ownership,” at the Aspen Institute in Washington DC in April. Kimberlee Cornett of the Robert Wood Johnson Foundation had urged Agents of Impact to wear purple to emphasize that affordable housing, small business financing, good jobs and healthy communities are not “red” or “blue” issues. Among the strategies we found compelling were “entrepreneurship through acquisition,” which help would-be entrepreneurs source, vet, purchase and manage businesses. A “community investment trust” in Portland, Ore. already is helping neighborhood families build wealth and community ownership. “Everything you do on your balance sheet has an impact on whether you’re extracting or putting back wealth in the community,” said Gary Community Ventures’ Santhosh Ramdoss. “How do you share a little bit more of it?”
- Keep reading, “Beyond affordability to ownership, wealth-building and economic security,” by David Bank on ImpactAlpha.
Employee ownership funds seek to give private equity investors a run for their money as businesses change hands. A handful of employee ownership funds are raising larger pools of capital to compete with private equity and strategic buyers for the millions of US businesses that retiring baby boomers are poised to sell. “This is one of the strategies that works for changing the equation for workers and families around their financial well being,” said Alison Lingane of Ownership Capital Lab, which has produced the Employee Ownership Capital Roadmap. Scaling employee ownership in the M&A market first requires making the business case for an “exit to workers” to the investment bankers and other intermediaries who often shape which buyers get a seat at the table. Structures like employee stock ownership plans, or ESOPs, confer generous tax benefits. “What we’re trying to do is to get to the traditional M&A markets and educate investment banks and other intermediaries who don’t currently understand or offer ESOPs on why this is so great,” says Katie Kimble, who brought experience from private equity and investment banking to this year’s launch of Monarch Investment Partners with co-founder Michael McGinley.
- Investor education. Chicago-based Monarch is seeking up to $250 million for an inaugural fund that will provide up to 100% of a seller’s financing to facilitate up to 10 employee-led ESOP buyouts. “There’s the potential for a tax-advantaged sale to an ESOP in which the net proceeds to a seller could actually be higher,” McGinley says. Another new fund, Liquidus Partners, is seeking to bridge a different capital gap – the need for sellers to finance at least a portion of the sale to their employees. Liquidus’ Brendan Richardson and Geoff Woolley are seeking to raise $300 million to acquire sellers’ notes from ESOP transactions. The thesis is that if sellers see a way to redeem their notes, more will be willing to participate in the process of transitioning ownership to their employees. Washington, DC-based Apis & Heritage Capital Partners has raised at least $180 million this year towards a $250 million target for its second fund, which aims to create 3,000 worker-owners over five years (see, “Apis & Heritage aims to help business owners ‘exit responsibly’ — to their employees”). Ownership Capital Lab is tracking nearly two-dozen funds that are raising a combined $979 million.
- Keep reading, “Employee ownership funds seek to give private equity investors a run for their money as businesses change hands,” by Roodgally Senatus on ImpactAlpha. Catch up on all of ImpactAlpha’s coverage of the Ownership Economy, produced in partnership with Sorenson Impact Foundation.
Can philanthropic bond guarantees expand access to capital for smaller cities and rural areas? It’s been a record year for issuances of municipal bonds, a low-cost source of capital for community infrastructure. But many smaller cities and public agencies that serve rural areas have been boxed out of the municipal bond market because of the perceived risk of their smaller tax bases, absence of a track record and lack of a top-tier credit rating. Lourdes Germán’s Public Finance Initiative is working with half a dozen small cities and rural jurisdictions in Maryland, Vermont, Arizona, Hawaii and other states that face higher borrowing costs. In Vermont, for example, the state bond bank is shifting post-disaster lending to encourage more risk reduction and resilience. “The bottom-line result is a low cost of borrowing for users, which ultimately means lower long-term tax bills in rural and urban areas with a history of underinvestment,” Michael Gaughan of the Vermont Bond Bank wrote with Brookings Metro’s Adie Tomer.
- Integrated capital. Germán sees opportunities to grow municipal access to lower-cost finance by joining public finance and philanthropic dollars, what she calls “integrated capital.” Public Finance Initiative’s Rural and Small Cities cohort is testing whether a program-related investment in the form of a guarantee from a philanthropic foundation with a AAA credit rating could function like bond insurance in the private market. Foundations have deployed similar guarantees to help lower borrowing costs for CDFIs and charter schools. One member of the cohort, the East Maui Water Authority, is exploring how public finance tools can be integrated with philanthropic investments to “create stepping stones toward greater local control,” the authority’s Gina Young says in a video case study of the project. Risk capital will be necessary to stand up some of the new lending programs and standardized financial products, says Damon Burns of Finance New Orleans, the city’s longtime housing finance agency, said on an Agents of Impact Call last year. “Our community demands this type of investment right now, so we don’t have time.”
- Muni Impact. Join Lourdes Germán, Michael Gaughan and Damon Burns, along with Eric Glass of Clarion Call Capital and Brian Boland of Delta Fund, for this week’s Agents of Impact Call, Wednesday, Dec. 17, at 10am PT / 1pm ET / 6pm London. RSVP here.
- Keep reading, “Can philanthropic bond guarantees expand access to capital for smaller cities and rural areas?” by Dennis Price on ImpactAlpha. See all of ImpactAlpha’s coverage of Muni Impact, sponsored by Robert Wood Johnson Foundation.
Dealflow: Returns on Inclusion
Esusu raises $50 million to help renters build credit history. Nearly 50 million Americans lack a credit history, cutting them off from economic opportunity. Unlike homeowners making mortgage payments, renters every year make some $1.4 trillion in payments that don’t get tracked. Fintech startup Esusu works with landlords to ensure that rent payments are reported to financial institutions. Its service is available in more than 5 million rental units encompassing $100 billion in annual rent payments, and has helped renters unlock some $30 billion in mortgages. “We are empowering renters to build credit, unlock capital, and participate fully in the economy,” said Esusu cofounders Wemimo Abbey and Samir Goel. “With our partners behind us, we are scaling solutions that serve as the bedrock of the American Dream.”
- Empowering people. The $50 million Series C round was led by Westbound Equity Partners, an early stage venture firm focused on tech-enabled economic growth and inclusion. The deal propelled Esusu’s valuation to $1.2 billion. The Geraldine R. Dodge Foundation, Blue Meridian Partners and family offices also participated. Earlier investors include Serena Ventures and SoftBank Opportunity Fund. “Esusu is fundamentally reshaping how the financial system can work for everyone,” said Westbound Equity’s Sean Mendy. “When people are given the tools to rise, they do.”
- Market Makers. Abbey was inspired to start Esusu after seeing his Nigerian-born mother borrow from a payday lender after being turned away from banks due to a lack of credit, he told Troy Duffie and Lenore Champagne Bearne on The Market Makers podcast. Listen to or watch the episode.
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Dealflow overflow. Investment news crossing our desks:
- Elemental Impact, BBG Ventures, Foundry and Renewal Funds were among the backers of a $24 million round for SuperCircle, a software company helping retailers with waste management. (SuperCircle)
- Sun King secured a $40 million equity investment from Lightrock for off-grid solar expansion in Africa. (Sun King)
Agents of Impact: Follow the Talent
David Maina joins Small Foundation from AlphaMundi Group, as investment director… Kara Murray, previously with the city of Boston’s Mayor’s Office of Housing, joins Social Finance as an impact advisory associate… Nordea Asset Management hired two managers to its €18 billion sustainable investing team… Galvanize Climate Solutions is recruiting an associate for impact measurement in New York… Advantage Capital seeks a renewable energy associate.
The Nature Conservancy has an opening for an impact finance specialist… Goldman Sachs seeks for a sustainable investing associate for its Horizon Environmental & Climate Solutions fund… AXA Investment Managers is hiring a climate-tech impact investing intern in London… IDB Invest is looking a principal officer for its corporates sector in the Andean region of Latin America.
👉 View (or post) impact investing jobs on ImpactAlpha’s Career Hub.
Thank you for your impact!
– Dec. 15, 2025
