Written by Andre Vashist, Social Finance Manager at VERGE Capital
The Old East Village Grocer opened its doors, softly, to begin their social enterprise journey and strengthen their mission to support people with disabilities. ATN Access Inc. worked on the OEV Grocer business plan for almost two years, and exploring ways to finance a startup social enterprise that would support people with disabilities gain employment.
VERGE had the opportunity to be the first impact investor.
Easier said then done. Even with a mandate to invest locally for impact and the funds to do it, we had no experience providing loans to social enterprise. Luckily, our community had been preparing us for this moment for many years.
Photo Credit: @Markettower
Leveraging our community’s success
We built our loan program quickly due to the foundation set by: Pillar’s Social Enterprise program, Goodwill’s Impact Loanprogram which had great partnership model with Libro Credit Union, community investment expertise from London Community Foundationand United Way London & Middlesex’s staff and volunteers, and best practice advice from MaRS Centre for Impact Investing. Combine that with an entrepreneurial spirit to do and learn simultaneously — were dove right in.
It is also important to mention support from Sisters of St-Joseph, Ursuline Sisters and the Government of Ontario, who gave us their vote of confidence to take on this new approach.
Learning together
Doing the due diligence for ATN Access Inc’s new social enterprise was as much a learning experience for them as it was for us. We got feedback on our application, review and financing process from ATN, as well as VERGE volunteer and partners. Then we mapped the process out on paper, but the unpredictability of practice kept us on our toes. It was a place-based impact investing bootcamp, and we came out stronger for it.
We finally approved the loan for ATN Access, after going back and forth on their financial model, market assumptions, operational capacity and assessing all the risks associated with being the first in, such as:Would they succeed at raising the rest of their startup costs?
Will the OEV Grocer work as they predict?
What happens if things don’t go as planned, will we lose a large portion of our Loan Fund?
To name a few…. But we did it. We felt confident in our process and defaulted to optimism. Soon thereafter, ATN succeeded in raising their additional capital through grants, donations and investment. We felt validated, and so did they. But that was just the start. They now had to get the Grocer up and running. With a great team of advisors and staff, we waited, watched and cheered them on.
Expecting the Unexpected
Like any good startup, of course things didn’t go as planned. Delays in opening kept happening. Their milestones were falling behind. We kept the faith. We knew that after such a long journey to get this point, ATN wouldn’t give up now.
On September 9th, 2016, the Old East Village Grocer opened their doors and we couldn’t be more pleased at the result. A beautiful space, co-located with a great coffee shop, future food retailer, connected to a food manufacturing incubator in the heart of one of London Ontario’s revitalizing neighbourhoods. We are excited for how this social enterprise continues to persevere in order to provide people with disabilities an equal opportunity at the labour market and a food dessert a place to find quality groceries.
Photo Credit: @Markettower
Another leg in the journey is complete, but as you can tell by this story, it’s just the beginning. We have already approved 4 more loans, and they each have their unique story to tell and they are teaching us how to be a better impact investor everyday.
Learn more about VERGE Capital’s Social Enterprise Loan Fund here.
VERGE is a collective effort by Pillar Nonprofit Network (acting as the backbone organization), London Community Foundation, Sisters of St. Joseph and United Way London & Middlesex with support from Libro Credit Union.
Funding provided in part by the Government of Ontario and the Ursuline Sisters of Chatham.