From the Page to Impact Investing: A Plan to End the Foster Care to Homelessness Pipeline

I am driving through Silverlake to drop my son Teddy off on his first day of first grade. Along Sunset Boulevard we see homeless encampments, signs of Los Angeles’ struggle to contain an expanding crisis. 

 From the backseat Teddy asks, Dad, what’s going on?

That innocent question, which I frustratingly couldn’t answer, led me to ask myself the same. The year was 2021. 

My colleagues at The Giving List were 10 weeks away from delivering the copy for the 2022 books, in Los Angeles, San Francisco, and Santa Barbara. And I knew I had the idea for my feature in The Giving List L.A.: I would examine how philanthropy was trying to and could help tackle homelessness. What I didn’t know was that Teddy’s simple question, and my journalistic response, would thrust me into a new career. 

The headline, penned by Giving List associate Les Firestein – once head writer for the ‘90s wildly successful TV show In Living Color – was “Can Homelessness Be Solved by Making it Profitable?” Characteristically punchy and accurate.  

You need to understand what working at The Giving List was like. As executive editor, my days were spent in deep conversation with some of the nation’s most sophisticated charitable foundation leaders, individual donors, and nonprofit executives. People on the forefront of bending philanthropy’s varied financial instruments towards strategies that went far beyond grants. 

In the context of these influences, I broke down the issue of homelessness into the core sectors trying to solve it: government, nonprofits, and philanthropy. My underlying contention was that government, through investments in housing, rental subsidies and service dollars, and nonprofits, often operating with little financial cushion, were doing the heavy lifting. And that philanthropy, which by dint of an IRS rule that they spend 5% of their endowment value in grants annually, was leaving 95% of its wealth off the table. The trick was how to mobilize that 95%, in excess of $100 billion in L.A. County alone, towards ending homelessness.  

To get there would require giving foundations and other institutional investors the risk-adjusted, market-rate returns they sought. And there were examples. A growing number of impact-focused real estate investment funds have been able to privately finance affordable and supportive housing by relying on government rental subsidies. 

But my thesis went a step further, arguing that by synchronizing philanthropy’s financial instruments – grants, Program Related Investments, Mission Related Investments, and loan guarantees – one could make investments in combating homelessness a no-brainer. That philanthropy can and should lead to a re-orientation of the energy of money. Beyond that first Giving List feature, I strengthened that thesis in articles in The Chronicle of Philanthropy, The Stanford Social Innovation Review, and ImpactAlpha. Somehow in that process of interrogation, I decided to move from writing to doing. 

Through the Eyes of Foster Youth

Before my days at The Giving List, I was a journalist with a hyper-focus on one issue above all else: foster care. 

It started back in the late 2000s, while I was still a graduate student of journalism at USC. I had heard about a lacrosse team in South L.A. that lost all its games. I went to check out the team and decided to volunteer as assistant coach. 

On that bare football field, behind obscenely high school fences, I met a young man named Chris. I remember he was getting into trouble at school and, stupidly, asked him what his parents thought. 

I don’t have any parents, I remember him saying. I live in a group home. 

I didn’t even know what that meant. But I visited Chris’ home in South L.A. There I met six boys who told me stories of how they were separated from their parents.

From there I started informally mentoring Chris and another teenage boy, John, who had also lived at the same group home. They would come to my apartment in Hollywood. We would play video games and go hiking in Runyon Canyon. Through their eyes I had a window into the foster care system, and it got me writing about it. 

As they neared their 18th birthdays, I couldn’t get over the fact that they would be going out into this world, alone, “Left to Themselves,” as one of my L.A. Weekly cover stories blared at the time. 

Then something big happened. In 2008, President George W. Bush signed the Fostering Connections to Success and Increasing Adoptions Act, which offered states matching federal funds to extend foster care to age 21. While Chris and John would be too old to access the program, it was my experiences with them that led me to found a nonprofit journalism organization, Fostering Media Connections, with a strong focus on seeing that states extend foster care. 

In 2010, California became the first to do so. And years later those additional three years have shown better outcomes for foster youth. 

When I last talked to John, he told me how he had become estranged from his three children, and that he had spent his twenties and into his thirties in and out of homelessness. 

I just don’t feel like the same John anymore, he told me.

It was heartbreaking. And like it had been more than a decade earlier, I saw the aftermath of foster care through John’s eyes – confirming my next steps. 

Like I had tried with nonprofit journalism, I planned on applying a new tool to give foster youth a fair shot: impact investing. 

The Foster Care to  Homelessness Pipeline    

By the summer of 2022, I had melded my new knowledge of private equity and philanthropy’s odd mix of financial instruments with my deeper, older foster care expertise. The result, a bold strategy to end the foster care to homelessness pipeline in L.A. County. 

The potential impact in combating the broader homelessness crisis was dishearteningly clear.  

L.A. County is home to the largest locally administered foster care system in the world, serving nearly 22,000 children and youth. Roughly 1,000 youth will “age out” of the system in L.A. every year without having been adopted or reunified with their birth families. More than 85% of the foster youth ages 18-21 in the county are Black or Latino – pointing to outsized racial disproportionality.

A seminal study found that between ages 21 and 23, 25% of California foster youth surveyed experienced homelessness, with an additional 28% reporting that they had “couch surfed.” Unsurprisingly more than one third of the county’s unsheltered population has experienced the foster care or juvenile justice systems. 

To stop this pipeline into homelessness would require housing – more than 1,000 beds – and in my model the private financing to do it. The problem was that I was a journalist with no financial training. My thesis seemed to make sense, but I needed proof. 

So, with the help of friends at the Ralph M. Parsons Foundation and the Reissa Foundation, we enlisted five other funders – the Conrad N. Hilton Foundation, the Weingart Foundation, the Specialty Family Foundation, Cedars-Sinai Community Benefit Giving Office, and the WHH Foundation – to fund a financial analysis of the model I proposed. That analysis, conducted by the well-regarded Genesis L.A., a local Community Development Financial Institution, was released in May of 2023 and found that privately financing foster youth housing at scale was possible. 

The next step was to launch a private equity real estate investment fund to do just that. Pretty simple, right? 

On the Cusp of Something Big 

Since the release of Genesis L.A.’s “Scaling Housing to End the Foster Care to Homelessness Pipeline,” I am much closer to realizing that vision than ever before.  

In 2023, I launched Good River Partners, a public benefit company, that has garnered support from 13 funders to pursue the development of a financial strategy that can deliver foster youth the safe and stable housing they deserve. For my partner, I brought on Kevin Clark, who before his most recent post with the California Department of Finance, aged out of L.A. County’s foster care system himself. 

We, alongside our partners, now have a strategy that will prevent homelessness, while giving thousands of young people in and exiting foster care something John wasn’t afforded – a fair chance at the lives they deserve. 

That you are reading this here, in The Giving List, should come as no surprise. Its pages are filled with the stories of people who dream of and execute on big ideas for social impact. Fertile ground for the ideas of tomorrow, a venue where I look forward to reporting on this dream’s realization.