By Tina Castro, Managing Partner & Co-Founder, Avivar Capital, Andrea Romero, NMIIC Fellow, Avivar Capital, and Adam Rubel, Executive Director, Hai Fund
From housing to sustainable agriculture and more, investor collaboratives working to make values-aligned investments focused on the unique social, economic, and environmental needs and opportunities of a particular place—whether a community, city, state, or region—are powerful mechanisms for pooling resources to amplify impact.
In April 2024, Confluence Philanthropy and the New Mexico Impact Investing Collaborative (NMIIC) brought together representatives from Toniic, Gratitude Railroad, and other key stakeholders to learn more about each other’s work and explore how collaboration can drive better investment outcomes for social and environmental impact. Our discussion highlighted the benefits of forming investor collaboratives to drive local change. These include the ability to create greater impact together than individually; the opportunity to achieve scale and efficiency while mitigating risk; and encouraging transformational thinking beyond silos.
Greater Impact Together
Collaborators can develop an ecosystem that builds the success of its stakeholders while creating a systemic impact beyond what any individual member can accomplish alone. By collectively learning about local needs and opportunities, collaborators can more effectively coordinate to deploy integrated capital tailored to those needs. This engagement expands their impact.
Effective place-based impact investing requires deep local knowledge and an understanding of the context. Investor collaboratives also allow investors to share expertise, leverage networks, and facilitate fund deployment. They can lower barriers to entry for those new to investing in positive social or environmental change.
Collaboration Provides Scale, Efficiency, and Risk Mitigation
A place-based collaborative can aggregate and deploy integrated capital from local and national investors and grant-makers. For example, NMIIC members catalyzed the development of the Local Impact-driven Fixed Income Targeted Investment New Mexico Fund (LIFT NM Fund), a fixed-income strategy managed by RBC Global Asset Management. Launched in May 2021 with an $11 million commitment from NMIIC members, the LIFT NM Fund grew to $36 million in commitments by Q3 2023.
Collaboratives can also leverage other forms of investment, like federal, state, or municipal resources, and increase capacity and cost savings through shared infrastructure and advisory services. Shared learning and investment diversification help mitigate risk for collaborators.
Collaboratives Encourage Transformational Thinking Beyond Silos
While there is no one-size-fits-all for values-aligned investing, achieving transformation requires valuing systemic change by addressing the root causes of problems across multiple issue areas. Collaboration with other investors compels asset owners to think holistically, beyond individual organizational priorities. In this way, collaboratives help investors focus on transformation, not just transactions. This reframing requires patient commitment from collaborators, investment in infrastructure, and sustainable funding for long-term viability.
NMIIC’s Impact on Shared Prosperity in New Mexico
NMIIC, a member-driven collaborative designed to catalyze and scale impact investing throughout New Mexico, is one such example of an investor collaborative supporting place-based impact investing. With the support of its impact investment advisor, Avivar Capital, members collaborate to source, diligence, structure, monitor, and report on impact investment opportunities in non-profit organizations, mission-driven businesses, and intermediaries for the benefit of New Mexican communities. Members share learning, build the field, and integrate capital by combining grantmaking, impact investing, and public resources to drive catalytic impact throughout the state. Members retain their decision-making autonomy while leveraging NMIIC’s shared resources and community of like-minded investors and funders. In the decade since its creation, NMIIC members have deployed more than $8.4 million across debt and equity investments driving impact in housing and the built environment, economic mobility, and health.
As impact investing continues to evolve, investor collaboration has emerged as a driving force for positive change in New Mexico and beyond. Toniic, Gratitude Railroad, and NMIIC are examples of strong impact investing collaboratives focused on generating positive, measurable social impact. The success of these collaboratives illustrates that where values align, collaboration facilitates greater impact. By coordinating the deployment of integrated capital, building efficiency in impact investing through shared services, and addressing local needs together, we can help the sector go further.
Tina Castro, Managing Partner & Co-Founder, Avivar Capital
Andrea Romero, NMIIC Fellow, Avivar Capital
Adam Rubel, Executive Director, Hai Fund
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