Investments of $7.75 million and plans for a portfolio of $100 million

Five years ago, Laura Callanan launched Upstart Co-Lab, aiming to connect investors to creative economy companies tackling wider societal issues, creating jobs and boosting local economies. Then, in June 2020, Callanan, former senior vice president of the National Endowment for the Arts, announced the Upstart Co-Lab membership community, a coalition of families, foundations, and others who seek to invest in such ventures. .

Upstart has just released its 2021 Impact Report with an overview of its accomplishments, including nearly $8 million invested by Upstart members in funds and startups. He is also launching his own portfolio to invest in creative economy funds and companies, with the aim of raising $100 million.

Upstart defines the creative economy as “a collection of art, culture, design and innovation industries, and the economic contribution of these industries within a geographic region”. To refine this, Callanan identified 145 industries, based on North American Industry Classification System codes, which are used by US federal statistical agencies to classify business establishments. She then grouped them into five categories: ethical fashion, sustainable food, social impact media, other creative businesses and creative places. They include businesses ranging from game designers and food producers to real estate projects with affordable workspace for artists.

Six funds and companies

The report highlights six funds and companies that Upstart members have invested in since 2020. One example: Upriver Studios. Founded by actress Mary Stuart Masterson and digital, film and television producer Beth Davenport in 2020, it operates a film and television production facility in New York’s Hudson Valley. There is also Stockade Works, a non-profit organization that provides workforce training, focusing on women, BIPOC and veterans. Based in a 101,000 square foot former warehouse, the facility has been repurposed to house sound stages, as well as production offices and other spaces.

Construction has been delayed by the pandemic, but it has also allowed the company to build Covid-compatible elements, working closely with industry and union leaders. According to Callanan, these moves helped Upriver land its first client, Warner Media/HBO Max’s “Pretty Little Liars: Original Sin.” Upstart members invested $350,000

Another example is Startup Preemadonna, a technology company focused on hardware and software that inspires girls’ creative expression. Its first product, the Nailbot, involves nail art, with the ability to print smartphone images onto fingernails using non-toxic ink. Ultimately, the goal is to teach “Preemadonnas” the basics of hardware and engineering while working with their Nailbots, as well as help them start micro-businesses selling nail art on an online platform. line. Upstart member investment: $100,000.

Other report findings:

  • Member Community Update. His five families, four foundations and one nonprofit arts funder, representing more than $1 billion in investment capacity, have closed and committed $7.75 million to 11 impact funds and companies . The members, who generally invest in a variety of areas, not just creative economy businesses, do not necessarily invest together, although many have. But all rely on Upstart’s due diligence and other support. Every two months, they meet as a group to hear pitches from fund managers and startups.
  • Pipeline. There is a pipeline of around 250 funds, direct corporate investments and real estate projects from fund managers, accelerators and Upstart’s advisory board, among others.
  • Capital mobilized. Upstart has raised over $17 million in capital for funds and companies.
  • Exceed opinion. The goal is for Upstart to not only act as an advisor, but also as an investor. To this end, it is launching a portfolio that will invest in creative economy funds and companies. According to Callanan, she talks to foundations about program-related investments, as well as donor-advised funds, in conjunction with ImpactAssets. The goal is to raise $100 million.
  • More training. In collaboration with Mission Investors Exchange and Grantmakers in the Arts, Upstart is hosting an arts and creative economy institute in April aimed at training arts program officers and CFOs, COOs and others in arts institutions and culture to impact investing.

Callanan also highlights Upstart’s new impact framework, with five dimensions for investing in the creative economy. One is focused on various entrepreneurs. According to Callanan, 35% of businesses run by women and 38% of businesses run by BIPOC founders belong to the creative industries. Another is the importance of quality jobs, as these companies tend to create work that cannot be outsourced.

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