From Concept to Reality—Milestone Growth Fund
The concept for Milestone Growth Fund grew from the unmet need that the Metropolitan Economic Development Association (MEDA) team saw in available funding for diverse businesses. It was evident that without adequate long-term capital entrepreneurs of color would be limited in the growth and success of their companies.
Too risky for bank financing and too small to attract traditional venture capital funding, diverse businesses had nowhere to turn. In order to fill this gap in financing, Milestone was created as an evergreen fund that would be able to finance a small number of companies at a time and then reinvest funds into new investments as they were repaid.
Launching and Growing Milestone
In 1986 a Milestone Growth Fund Board of Directors was formed, a business plan was prepared, and fundraising efforts began. In January 1990 our doors opened for business with two employees and $1.3 million in contributed capital. This capital was provided by community, corporate and private foundations that saw a clear need to strengthen the Twin Cities diverse businesses.
In 1995 Milestone was asked to participate in the State of Minnesota’s Urban Initiative Program (UIP). This program provides matching funds to invest in companies located in the Twin Cities most economically disadvantaged municipalities. UIP has been one of the most successful partnerships in Milestone’s history. Under this program Milestone has invested a total of $6.4 million in 22 companies.
Since its inception, Milestone has invested $26.7 million in 78 small businesses. Over the past decade, those companies have generated gross receipts of over $1 billion, paid $41.5 million in taxes, and employed 550 workers per year on average. Milestone’s financing has attracted an additional $200 million in financing for its clients.
At Milestone, we are proud of our role in developing successful business leaders in the Twin Cities communities of color. Milestone clients become involved in community initiatives to solve social problems and inspire others to pursue the American Dream–something that benefits not just persons of color but the broader Twin Cities community.