Montcalm is re-imagining the way our financial system works.
The venture capital model prioritizes companies that have the potential for 20x growth and an IPO or other exit strategy. The hunt for the next unicorn leaves many companies undercapitalized–particularly ones that are as driven to create social value as they are financial returns.
Montcalm is a financial services platform committed to increasing both the velocity and volume of capital flowing to support organizations working towards a better world. Our investment in The Town Kitchen is a case study in activating the ecosystem we’ve created to fund a social enterprise that is rapidly responding to the unprecedented need in a time of considerable uncertainty.
Established in 2015, The Town Kitchen is a community-driven food company that employs and trains youth from the foster care and reentry communities (traditionally underemployed populations) to deliver nutritious meals to corporate clients. Their excellent execution on both the business and social aspects of their mission has led to strong brand loyalty that allows them to command a higher price for their chef-crafted meals.
Montcalm Capital conducted due diligence on The Town Kitchen and determined that they were a strong fit for impact investment. Montcalm’s diligence revealed a strong social impact organization with a robust foundation to support future success. The company demonstrated a history of diversified revenue generation anchored by long-term relationships with large corporate clients and small local businesses. The company’s experienced leadership has a proven track record of successfully navigating adverse business conditions and continually expanding business operations, meal preparation and delivery infrastructure, and sales. And perhaps most importantly, their community-based socio-economic empowerment model fit Montcalm’s catalytic impact investment thesis.
Montcalm’s hybrid investment strategies to fund the execution of a new 7-figure contract includes:
- $100,000 mission-related investment from the Martin Foundation DAF
- $250,000 loan from Mission Driven Finance
- $75,000 recoverable grant from an anonymous foundation
These investments will allow The Town Kitchen to scale up its operations, purchase kitchen equipment, provide critical cash flow, and hire 17 employees.
“Opening up a donor-advised fund (DAF) at Montcalm allowed our family foundation to meet its annual distribution requirement before we had charities identified to support with grants. By recommending a mission-related investment in The Town Kitchen, we’re able to help empower vulnerable youth with job training and employment experience today,” explained Jessie Thompson, the executive director of the Martin Foundation. “Because it’s structured as an investment, it will grow the amount of money we can grant to charity down the road. It’s win-win-win!”
“Mission Driven Finance exists to help worthwhile endeavors struggling to achieve scale. Our $250k loan enables The Town Kitchen to advance to the next level, securing not just one mega-contract, but supporting the capacity to bid on several more and continue hiring and training more young people. It’s a great example of deploying transformative capital to a multiple-bottom-line project that will generate meaningful returns for the youth they employ, the corporate clients they serve, and the investors who are supporting their expansion,” said David Lynn, CEO of Mission Driven Finance.
One week into the Bay Area-wide shelter-in-place mandate, The Town Kitchen announced the launch of Town Kitchen Provisions in response to the unprecedented impact of the COVID-19 pandemic. They will be delivering food and household essentials directly to consumers ordered to shelter in place, to a combination of underserved and paying customers. The new program offers a rotating menu of sustainably packaged, ready-to-eat family meals crafted by award-winning chefs along with household essentials such as toilet paper, paper towels, and disinfectants.
At a time when too many restaurants and small business are being forced to shut their doors, The Town Kitchen’s pivot has allowed them to do the following:
- Retain 40 hourly employees. TTK is providing additional training through TTK University, which allows youth to upskill while earning money, as these jobs evolve to deliver prepared meals and household essentials through Town Kitchen Provisions.
- Deliver to over 50 households in at-risk communities during the first three days of program operations.
- Retain 15+ minority and women-owned companies/ vendor relationships while adding access into residential channels (at a time when many are forced to cancel these contracts)
Impact metrics related to The Town Kitchen and their COVID-19 response will be tracked by Proof of Impact, a technology company committed to data tracking and verifying impact related to the UN Sustainable Development Goals (SDGs). As part of the Combat COVID-19 program, Proof of Impact will measure and verify impact metrics including data tracking of the number of provision packages delivered to families in need, employment of workers with livable wages, and integration of women-owned businesses into the supply chain as part of their response to COVID-19. The verified impact results will be made available to investors and key stakeholders on a data dashboard that showcases the efforts of The Town Kitchen to support their community.
“Montcalm has been building this ecosystem precisely to support the Town Kitchens of the world,” said David Cooper, Co-Founder of Montcalm Capital. “The Town Kitchen has proven to be incredibly nimble in meeting community needs during these early days of the COVID-19 crisis, and it’s the hybrid investments that we’ve facilitated that have enabled them to be in such a strong position during these uncertain times. We’re inspired by the way they execute on their mission every day.”
“As a Public Benefit Company, the jobs, living wages, career help, mentorship, and life-skills training we provide to the youth we employ are all essential to the way we deliver chef-crafted meals to our discerning clientele,” stated Eric Quick, CEO of The Town Kitchen. “Montcalm partnered with us at just the right moment to help us scale our successful business model by leveraging catalytic capital.”
Montcalm is helping The Town Kitchen raise an additional $500k this month.
If you’re interested in empowering local youth by investing in an innovative, mission-driven company–potentially with tax-deductible charitable dollars, contact Alisa Tantraphol at alisatantraphol [at] montcalmtcr.com.