Five Ways to Catalyze Community Capital in Ontario

5 min readDec 17, 2020

In Fall 2020, over 50 representatives from Ontario’s community of place-based funders, investors, and intermediaries gathered for three days at the Catalyst Ontario convening to discuss discuss community capital approaches for our province’s journey to recovery and resilience. This convening was supported by the Ontario Trillium Foundation (OTF) in collaboration with the Scaling Impact network and organized by the Pillar Nonprofit Network.

As policy makers and community leaders examine and implement solutions, we are seeking opportunities to act together in providing capital and capacity support to organizations and enterprises that can lead at a local level. This article summarizes five (5) key actions for the community capital movement to consider based on insights from the gathering:

1. Learn from active and emerging models for place-based investing in Ontario and across Canada.

There is a large and growing place-based impact investing movement across the country from coast-to-coast-to-coast and throughout Ontario in urban centres and rural regions. We heard from many community capital networks, institutions and partnerships, including:

Key insights from these case studies:

  • Common questions: We have similar questions about how to effectively scale and manage risk.
  • Maturity: There is a developed understanding of how to manage deal flow and structure innovative funds and products.
  • Applicability: We can leverage a wide range of innovative and interesting practices.
  • Context: Place-based initiatives are shaped by local experience, yet they do offer adaptable models
  • Infrastructure: Shared architecture can speed implementation for new entrants and scale current actors

“It is exciting to think about the value of shared services and collaboratives to make this work sing.”

2. Harvest insights from US experience with the Community Development Financial Institution (CDFI) model

Leaders from the Nonprofit Finance Fund and Cutting Edge Capital provided the following insights and lessons:

  • The emergence of CDFIs is directly connected to the civil rights movement and social justice movements of the 60’s and 70’s
  • CDFIs are a result of a key policy change: Reinvestment Act in 1977
  • CDFIs are highly reliant on philanthropy to support their operations. Even CDFIs in the US, with a longer history and federal funding/support, need to have their operations subsidized
  • The scale and scope of the US CDFl community movement is impressive, with billions in assets invested across the country
  • There are a variety of ‘communities of interest’ using this model, including BIPOC communities, geographic communities (national, state, and local level), and sectors of focus (affordable housing, food, etc.)
  • CDFIs have been leveraged as infrastructure to respond to COVID-19, and they are seen as a critical tool to build a more inclusive future in the US

3. Leverage existing infrastructure like Community Futures Organizations.

In Ontario, Community Future Development Corporations (CFDCs) have an infrastructure with a strong track record. Since 1995, CFDCs have invested $2.13B in 27,196 businesses influencing 138,479 jobs at a cost per job of $15,381. These businesses leveraged an additional $2.09B in equity and third party financing (ratio $1.00 — $1.02).

In addition, 69,631 businesses received capacity support, here are some the model’s key success factors:

  • Governance based on a geographic community of interest
  • Developmental lending approach to clients (character based, varied collateral security, flexible terms, regular monitoring)
  • Clear performance measures (cost per job, leveraged funds, 5.7% average losses)
  • Adaptability to economic environment (1980’s high interest rates, 2012 economic downturn, 2020 global pandemic)
  • Improvement of delivery processes (Management Systems, Remote Delivery)

This is critical infrastructure to integrate into a more intentional community capital ecosystem in the province, alongside credit unions, co-operatives, and place-based impact investing funds.

“Hoarding wealth is a state of illness.”

4. Apply an equity lens to community capital, including both racial and gender equity.

Narinder Dhami from Marigold Capital, Victor Beausoleil from Social Economy through Social Inclusion and Jeff Cyr from Raven Capital clearly expressed guiding principles for an equitable approach to community capital:

  • Leadership in our institutions reflects the diversity of intersectional identities including gender, race, ability, and status
  • Ownership and representation in decision-making authority is centered around justice and equity
  • Move beyond commitments to solidarity and take real action in applying an equity lens
  • Identify folks doing grassroots, on the ground work, and compensate lived expertise
  • Return to a state of wellbeing through reconciliation and learning from other cultural ways of knowing.

5. Leverage momentum in the movement to transition from scaling intention to scaling impact together.

Participants of Catalyst Ontario indicated a strong desire to move forward, and here are the leverage points for our next steps:

  • Forging partnerships: We will be reaching out to current and new partners to firm up and broaden the core community advancing this agenda.
  • Acquiring resources: We will be pursuing resources to advance this work.
  • Co-designing and refining the process: We will be working with partners and the broader community to co-design and refine the process.
  • Getting started: We can move quickly from research to practical actions.

We will not replicate the current financial system. This type of innovation must navigate key questions and challenges:

  • Scale: For this to be successful at a grassroots level, we need to be active in local economies and use accessible language.
  • Perception: Although the intention is to mobilize and create community wealth, we will need to manage any potential perception or concerns related to a common question around social finance: is this perceived as a form of continued privatization?
  • Community: There is a lack of understanding about a community-led approach: how will we ensure community ownership and leadership in such a wide ecosystem and geography?
  • Policy: It is challenging to create a supportive policy environment at the best of times for progressive solutions. Current economic and political conditions may create an open window or high hurdles for potential success.
  • Capital: We need to advance this work before having certainty about who will be putting operating and investment capital in to support the build out of policy and ecosystem infrastructure (e.g. government, institutions, foundations, citizens).

The community capital system must be inclusive and regenerative — and we must be brave and bold. We look forward to sharing more about the next steps for Ontario’s Community Capital agenda in early 2021.

For more information about this work including how you can be a partner or collaborator, please contact Adam Spence, C/O Catalyst: Community Capital Initiative at




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