Please ensure Javascript is enabled for purposes of website accessibility Impact Investing: Financing Grocery Stores for Healthy Food Access


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A young girl bags groceries at an impact investing financed grocery store

MISSION Framework: Impact investing for community returns

Aliya Hussaini, M.D.

In Grambling, Louisiana, it’s hard to stock up on the basics. Families have to leave their community to get everything they need, including their weekly groceries, because retail options in Grambling are limited. At the same time, opening and maintaining a viable grocery retail business – especially in communities where businesses often shutter – is risky, tough work. Making it tougher still: even if a business owner wants to open a grocery store, it’s difficult to find a bank loan to open a market because the conditions aren’t financially low-risk. Grambling is just one example of cities across the mid-South of the United States that need increased access to fresh, healthy foods, but are often unable to sustain retail businesses to supply the community.  

As part of our work to expand access to healthy food options, we work with HOPE Enterprise Corporation, a Community Development Finance Institution (CDFI), to help finance grocery stores and other food retail businesses. As a CDFI, HOPE’s mission is to strengthen communities, build assets, and improve lives in economically distressed areas of the southern United States. They do this by providing access to high quality financial products and related services – HOPE has the relationships, networks, and technical assistance to support everything from conducting studies on the potential market to establishing distribution relationships to store set-up and stocking to marketing and outreach to customers to store logistics and business planning.   

As a philanthropy and as impact investors, we invested in HOPE to leverage their expertise, relationships, and support services that are critical to our would-be grocery retailers.  HOPE can lower barriers to entry and risks for the potential grocery retailers, helping them to create successful businesses. Once the grocery stores are sustainable, the owners can repay the loan portions of their financing – meaning that more funding would be available for HOPE to grant to other promising retail businesses across the region. Successful grocery stores and retailers can be an anchor for other businesses to move in and build greater community development.  

As part of this work in Grambling, HOPE leveraged our investment to help fund a grocery store called Legends, which will be the anchor retailer in a revitalized shopping center. Other retail stores like Hibbett Sports, Dollar Tree, and a beauty supply store joined in – bringing even more investment into the Grambling community, which didn’t have a grocery store before.  

Our investment in HOPE is about creating access to healthy eating options while contributing to a healthier, more economically resilient community. In the impact investing MISSION framework, one our focus areas is ‘Incrementality,’ or the idea that any investment we make into a business will add value beyond the scope of, though not a replacement of, mainstream capital. As investors, we must ask if the impact investment opportunity, and related additional investments, would be realized without the foundation’s contribution.  

In our work with HOPE, our combination of grant and loan funding allows for greater financial flexibility to build a healthy food retail ecosystem more rapidly and to help prove a business model to future investors. The foundation’s funding for HOPE has catalyzed additional funding from other investors by approximately 12.5 times the initial funding.  

Through the Mid South Healthy Food Initiative, a public-private partnership, HOPE has financed 11 healthy food projects throughout the mid-South and directly invested $16 million and leveraged $44 million. The HOPE-financed projects have developed more than 209,750 square feet of additional grocery store space, significantly expanding access to healthy food for residents of low-income and underserved communities. 

HOPE Enterprise Corporation is a financial partner that builds the idea of ‘Incrementality’ in its mission. While HOPE provides valuable financial tools, it also provides a support network that retailers need to thrive. With branches throughout the South, HOPE has connections to distributors, business partners, and experienced retailers who can provide non-financial services to a new retailer in a town like Grambling. By building relationships with state and local government, HOPE remains viable and attuned to the shifting market in their region. These relationships also help HOPE unlock other funding and help decision-makers focus on healthy food access issues.  

It’s important to us to use our learnings from HOPE’s innovative, “riskier” projects to identify food access solutions for low-income families that may be outside of the traditional big food retail stores. We aim to continue working with partners like HOPE to fill gaps in the food supply chain and create last-mile solutions so that families can build healthy lives for their children.  

In partnership with the Michael & Susan Dell Foundation, the Social Innovation & Investment Initiative at the New York University Wagner Graduate School of Public Service (NYU Wagner) analyzed more than 40 foundation-related investments, and together we developed a MISSION framework to document the foundation’s impact investing strategy. The framework is comprised of the following elements: Market, Impact, Scale, Sustainability, Incrementality, Organization, and Next. This is the sixth post in a blog series that focuses on each of these elements. This post, on the Incrementality aspect of the framework, describes the way HOPE Enterprise Corporation to strengthen communities through impactful financing. Read the full case study here.