Renewal2 – Open to Foundations

I recently received an update from Renewal on the development of their Renewal2 Investment Fund. In addition to hearing that the fundraising is going well in-spite of the financial crisis, I’m glad to learn that they have created an investment structure that makes it easier for foundations and others to invest across North America.

It’s an interesting time for foundations, and some like the W.K. Kellogg Foundation and Gates Foundation are making bold moves by setting up their own venture funds or indicating that they are moving toward spending down (vs. preserving endowments). I hope that some more foundations take these steps and look to investing in funds like Renewal2 to spur the different forms of innovation that are possible.

Perhaps these structures coupled with the change in financial tides might spark some more urgent and innovative investments among foundations. As history has now proven – they can and do perform better than the market.

From the Renewal2 update:

“We have three investment entities: a Canadian Limited Partnership, a U.S. Limited Partnership and a Canadian Trust.  The U.S. LP was set up to make it much easier for U.S. individuals to participate in Renewal2.  The Canadian Trust has been set up to allow Canadian foundations to invest. We believe Renewal2 is an interesting vehicle for mission related investing by foundations.  No such trust is necessary in the U.S. as U.S. tax laws, unlike Canadian tax laws, do not prevent foundations from investing directly in LPs.  We completed the trust documentation last week so now all of the legal structures are in place.”

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