In Detroit, MRIs and PRIs Come with Some Risk But High Reward - NPQ – Nonprofit Quarterly - Promoting an active and engaged democracy.

In Detroit, MRIs and PRIs Come with Some Risk But High Reward - NPQ – Nonprofit Quarterly - Promoting an active and engaged democracy.: The Kresge Foundation’s Rip Rapson is leading the charge for foundations to put more of their non-grant capital to work for social good. In addition to making grants, foundations can make program related investments (PRIs) which can take the form of below-market rate or even zero-interest loans, loan guarantees, or even equity investments. Some foundations, such as the Kellogg Foundation, are even using their investments for what they call “mission-related investments,” or MRIs, putting some portion of their corpus into investments that earn a market return but also further the foundation’s mission. MRIs are a strategy that has been modeled by the F.B. Heron Foundation and is slowly making its way into foundation practice.

Rapson says that foundations “are motivated to extract the highest possible value from the resources at their disposal. It’s a moral issue, and it’s a question of efficacy.” We take this to mean that foundations should be—but unfortunately, too few are—motivated in this way. In Detroit, however, where investment capital is needed to help move a broken economy in new directions, foundation PRIs and MRIs make immediate sense.