In addition to our grants, the Packard Foundation makes a variety of Program-Related Investments (PRI), alternatives to outright grants primarily issued as low-interest loans (and in a few cases guarantees or equity) for which the Foundation is confident of repayment of the full principal amount with some limited returns. PRIs advance our programmatic strategies, extend our impact, and provide variety in the support we can give our investees.
The Packard Foundation made its first PRI in 1980, a $6,000 loan to help the Yosemite Natural History Association (now called Yosemite Conservancy) publish the book, Discovering Sierra Nevada Birds. From this early seed, the Foundation’s PRI program has evolved and grown, with over $450 million invested in more than 200 PRIs.
Our PRIs support transformational impacts and innovation, and help our investees grow into financially sustainable organizations and borrowers. The Foundation considers PRIs when a traditional grant would not necessarily provide the most effective or appropriate support. These institutional investments are valuable as a bridge to fundraising efforts and future revenues, and can help organizations seize time-sensitive opportunities or tackle large-scale projects, attract new sources of capital, and scale their efforts for maximum impact.
The repayment structure of PRIs allows us to recycle the capital and maintain a permanent pool of PRI funds to serve future needs. The board set a maximum cap of $180 million in approved PRIs at any one time. While the Foundation has the ability to make both PRIs and other types of mission-related investments, to date all of our investments have been structured as PRIs, which we have found to be the most effective tool to achieve our programmatic objectives.
The Foundation’s PRIs adhere to IRS regulations, which define PRIs as investments that are made for a charitable purpose, that do not support lobbying or political activity, and in which the return is not a significant purpose of the investment.
The Packard Foundation is a proud member of the Mission Investors Exchange, where philanthropic innovators exchange ideas, tools, and experiences to increase the impact of their capital.