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PO S I T I V E CA P I TA L CO R P. PBC
Baltimore Hatch Fund
A Public-Private Impact Investment
If anything April 2015 has ...
PO S I T I V E CA P I TA L CO R P. PBC
Approach:
A Business Development Company (BDC) is a type of publicly traded company...
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Public private impact investment concept overview

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An exchange listed, for-profit fund,which due to its nature will allow anybody including unaccredited investors to invest, managed by a non-profit with experience in that sector and the mission to create jobs. Such a fund will offer the whole community the opportunity to invest in its future, generate wealth and inclusiveness. At the same time, anyone who needs access to some or all of his/her investment can sell shares without affecting the fund's investment capital. Thus the fund will become “evergreen”.

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Public private impact investment concept overview

  1. 1. PO S I T I V E CA P I TA L CO R P. PBC Baltimore Hatch Fund A Public-Private Impact Investment If anything April 2015 has demonstrated this: Baltimore desperately needs jobs for low and/or unskilled labour. But Baltimore also needs an inclusive approach for its community and a demonstration that all of its constituents are willing to contribute to it. Significant numbers of jobs can only be achieved through labour intensive processes in manufacturing and services. This is “unsexy”! Due to automation and global outsourcing there are fewer and fewer firms in that sector and hence it is challenging to attract them to Baltimore from other parts of the country. They need to be started in Baltimore. The plan: Bring “unsexy” back to Baltimore and create significant numbers of jobs. An exchange listed, for-profit fund,which due to its nature will allow anybody including unaccredited investors to invest, managed by a non-profit with experience in that sector and the mission to create jobs. Such a fund will offer the whole community the opportunity to invest in its future, generate wealth and inclusiveness. At the same time, anyone who needs access to some or all of his/her investment can sell shares without affecting the fund's investment capital. Thus the fund will become “evergreen”. Create jobs and opportunities: The fund aims to invest in start-ups and SMEs with an emphasis on labour intensive manufacturing and services that provide jobs and opportunities for Baltimore. It will also offer mentorship and guidance for these firms as needed. It will take minority equity stakes and/or offer affordable loans to those businesses. Hence it will incentivize an ecosystem in that space. Particular emphasis will be put on firms that offer a co-op approach to their workforce and pay a minimum hourly wage of $15. WWW.IMPACT4CHANGE.COM 1817 BOLTON STREET BALTIMORE , MD 21217 (+1)667 212 8867
  2. 2. PO S I T I V E CA P I TA L CO R P. PBC Approach: A Business Development Company (BDC) is a type of publicly traded company that invests in small and mid-sized businesses. In a way, a BDC is like a venture capital fund. But only institutions and very wealthy individuals can invest in VC funds. In contrast, BDCs are publicly traded on the stock market, so anyone, including unaccredited investors, can invest by buying shares of the BDC. They can also sell those shares if they need to, overcoming the problem of a lack of liquidity associated with private investments. BDCs may make equity or debt investments. It may even become an investor in a Pay-for-Success structure. To qualify as a BDC, companies must be registered in compliance with Section 54 of the Investment Company Act of 1940. Congress updated the 1940 Act in the 1980s, creating the concept of a BDC as a way to encourage investment in small and mid-sized private (or thinly traded) companies. BDCs take a minority stake and provide managerial assistance, but do not control the companies. BDCs have great potential for community-based investment and economic development—imagine a locally-focused BDC. But they haven’t been used that way to date. Most BDCs are Wall Street creations focused on “middle market” companies, which are substantially larger than what we typically think of as small, Main Street or even mid-sized businesses. - A source of long term capital that falls somewhere between venture capital, IPOs and private equity - BDCs have been legal since 1980 - Portfolio companies benefit from the expertise and economies of scale of the BDC, while retaining their independence - Ordinary investors can invest in a BDC with the ease of buying stock Status: We have identified and are collaborating with a Baltimore based non-profit whose mission matches this approach and which can demonstrate many years of successful track record. We have also conducted numerous conversations with foundations, institutions and thought leaders and have found broad consensus and a willingness to support this idea. If all constituents of this community come together it should be possible to launch the fund by April 2016. A clear demonstration that Baltimore is serious about inclusiveness. Baltimore's economy can get back on its feet. An approach like this can help heal the social fabric of its community as it demonstrates that all its constituents work together to achieve this. More disposable income will benefit the economy, will increase city taxes and contribute to social security. Baltimore can hence serve as a blue print and a beacon to the nation that America and its distressed communities have enough strength and ingenuity to regenerate themselves. WWW.IMPACT4CHANGE.COM 1817 BOLTON STREET BALTIMORE , MD 21217 (+1)667 212 8867

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