Three Roots Capital receives $1.8 million under federal “CDFI Rapid Response Program”
Three Roots Capital has announced that the U.S. Department of the Treasury has awarded the organization $1,826,265 in COVID-19 relief funds as part of the “CDFI Rapid Response Program.”
CDFI stands for Community Development Financial Institutions, and Knoxville-based Three Roots is so designated in addition to being a Community Development Entity. In total, the U.S. Treasury awarded $1.25 billion to 863 CDFIs in 48 states, the District of Columbia, Guam and Puerto Rico. Three Roots received the maximum award amount given and will use the capital to increase the size of its Three Roots Capital Impact Fund, which is a pool of capital from which it will make equity investments in addition to loans.
“I founded Three Roots in direct response to the chronic need for more investment capital in central and Southern Appalachia and in the broader Southeast,” Grady Vanderhoofven, Three Roots Capital Founder, President and Chief Executive Officer, said in a news release. “This award allows us to continue to support small businesses and entrepreneurs in low-income and economically disadvantaged communities throughout the region. CDFIs play an integral role in helping to lift economies, especially in times of need like this pandemic. We are honored to receive the maximum amount of this CDFI RRP award. Receiving these funds helps us continue to do what we do best: providing capital, connections, business coaching and collaboration in our region.”
Three Roots anticipates the CDFI RRP funds could be used to help address an access to capital gap identified by Techstars in their Assessment of the Entrepreneurship Ecosystem of the Greater Knoxville Metropolitan Area. Oak Ridge National Laboratory, the Tennessee Valley Authority and the University of Tennessee recently announced the upcoming launch of a Techstars Industries of the Future Accelerator in Oak Ridge-Knoxville, which will foster the growth of 30 startups over three years.
Three Roots has a history of providing access to capital for small businesses, entrepreneurs, and projects in rural or low-income areas of East Tennessee and Kentucky. Since its founding in 2016, the CDFI has deployed more than $74.5 million of capital that has created or retained 1,564 jobs and developed 528,732 square feet of real estate.
Click here to read the Department of Treasury news release.
