How did a recovering attorney find her passion in local investing for impact?

by Teri Lovelace, LOCUS President

Ever felt like your chosen profession or career didn’t quite reflect your inner values? You know that feeling when you’ve made choices but you’re not exactly “planted” in the right pot. You feel it inside, that small nagging discontentment urging you to do more for a greater good, but the path is unknown, uncertain and very scary. I chased careers, education and certifications to find the elusive alignment between heart and mind that I desperately craved. And each unique professional experience brought me a bit closer to what I know now as my true passion—social finance and mission investing.  

As a merger & acquisition (M&A) attorney with a MBA, capital markets and capital flows fascinated me, particularly their contradictory nature. Capital permits creativity, creates wealth, transforms businesses and expands opportunities. Yet, as powerful and empowering as capital can be, it never seemed to flow easily or readily to those communities, businesses and people most in need. I was a fundraiser for our 80+ year-old local community house, modeled after the 1920’s settlement house movement that embodied the idea that poverty must be treated systemically—that the causes, not just the symptoms, must be addressed. This experience galvanized in me the essential need for community investments—not just charity—in vital services like childcare, pre-K education, affordable housing, senior care and job creation for the working poor.  

I was lucky enough to work at our local community foundation, The Community Foundation Serving Richmond and Central Virginia, www.tcfrichmond.org, with incredibly thoughtful donors, deeply committed to the community. From these philanthropic visionaries, I saw a longing for vibrancy of place and prosperity for all. I saw firsthand that traditional grantmaking, although critically important, could not solve pressing social issues like housing, access to living wage jobs and quality childcare. Annual 5% payouts from private foundations were necessary but were they sufficient to create jobs? Ensure safe housing? Provide access to fresh foods? Not really. While working at the foundation, a donor challenged me asking, “Teri, do you have any place for me to invest my charitable assets to do good locally and receive a return?” I was stumped.  

In my search to answer this donor’s question, I discovered a different kind of financial institution unlike the corporate finance world I had left behind. These CDFIs—community development financial institutions—were using their capital (not grants and gifts) to achieve social change in a well-defined geographic region. Many were focusing on Maslow’s basic needs of housing, security, food, health and jobs; these institutions were bringing solutions, hope and prosperity to underserved communities through capital. What a novel idea! And, most of these CDFIs were nonprofits that, rather than focused on fundraising and program administration, deployed capital to create jobs, enhance quality of life and build vibrant communities. It wasn’t charity and it wasn’t purely investment...it was social finance. It was the opportunity to do good and get both a financial and social return. A light bulb went off! If you cared about place and were philanthropically inclined, why wouldn’t you want to participate in this new way of investing for impact? This was the answer for my donor friend! And, I was finally planted where my values aligned with my profession—the use of capital for good.   

After nearly 5 years at Virginia Community Capital (VCC), a CDFI bank, helping to catalyze over $15 million in impact investments from foundations, high net worth individuals, family offices and socially aligned investment managers, I find myself leading VCC’s new social venture—LOCUS Impact Investing. LOCUS empowers place-focused foundations nationwide to invest their capital locally to build prosperous, vibrant communities. LOCUS builds on VCC’s 11 years of experience in successfully deploying over $350 million for vital community projects while leveraging total community impact of nearly $1 billion all with a very low charge off ratio. LOCUS’ mission-aligned “banking” experience and financial infrastructure create a much needed “on-ramp” for foundations that want to engage in local investing for impact. It is my vision that LOCUS, as a trusted partner to foundations, will empower them to unlock their philanthropic capital for mission investments, building prosperous and vibrant communities across our country.  

So, what’s the common thread between a M&A attorney, a community settlement house, a donor advisor and a CDFI? These unlikely and disparate experiences, along with tons of patience and trusting my inner voice, have fueled my passion and ignited my longing for social finance and mission investing, resulting in a new career path with LOCUS Impact Investing. Let the next leg of this journey begin!

Teri Lovelace is President of LOCUS and Chief Impact Officer at Virginia Community Capital. Please join the LOCUS mailing list to learn more about local investing for impact.

Watch for the next LOCUS blog describing why co-founder of the Center for Rural Entrepreneurship, Deb Markley, joined forces with VCC to launch LOCUS.