Caroline’s background & role before Open Road

Caroline has spent her entire career in impact investing, a path she admits she stumbled into by chance. After earning her undergraduate degree in business, while many of her peers joined prestigious institutions like Bear Stearns, she discovered a small nonprofit called Calvert Foundation (now Calvert Impact). At the time, she felt she had gained a good understanding of global issues through her political science classes in college, but lacked the tools to address them—until she found finance. This led her to work for a microfinance institution in Bolivia, where she realized her desire to pursue a different path from traditional investment banking.

Caroline refers to Calvert as the “grandmother of impact investing” in the U.S. because its founders were true visionaries who recognized the potential of capital beyond just financial returns. Starting her career there right after college, she was also entering the workforce during the 2007–2009 financial crisis, an interesting time to learn about the transformational power of debt and the discipline required to be a lender. While venture capital tends to dominate discussions in impact investing, she emphasizes that being a good lender requires a specific mindset, often focused on mitigating worst-case scenarios. 

Open Road, how did it start & the problem it’s aiming to address

Open Road’s origins are rooted in philanthropy and an unexpected connection through Burning Man. The organization was founded by Dr. Lori Michaels, an individual philanthropist who had been making grants for years. During one of her annual trips to Burning Man, she learned from a friend who managed a large corporate foundation about a significant issue: the foundation had funded medical equipment for a women’s hospital in Nicaragua but failed to budget for the excise tax needed to transport the equipment from the U.S. As a result, the equipment sat in Atlanta for six months due to the foundation’s rigid policies, which made it impossible to secure an additional $50,000 to cover the tax.

Lori was inspired to address this problem after being challenged by the foundation, leading to the creation of Open Road. Initially, the organization focused on funding one-time, unexpected roadblocks like the one in Nicaragua. Over time, however, they recognized that these challenges weren’t just about funding gaps, but also about timing. Open Road’s mission evolved to focus on improving the financial system to better serve mission-driven organizations that are doing important work but often encounter financial obstacles at critical moments.

The need for bridge funding beyond what is provided

Caroline explains that Open Road has always taken a hypothesis-driven approach to addressing the need for bridge funding. Initially, the organization operated on a family office balance sheet, making a few bridge loans. However, in 2020, they launched their first external fund after recognizing that the demand for funding far exceeded what they could manage alone. Now, they are preparing to scale further with their next iteration.

When looking at the broader issue, Caroline cites the Climate Policy Initiative, which reported that approximately $1.27 trillion in climate finance was distributed in 2023, with around $630 billion coming from government funders. However, Open Road’s data shows that it can take up to 21 months for government funding to move from approval to disbursement. This gap between large climate commitments and the actual delivery of funds raises concerns, particularly given the urgency of the climate crisis.

To address this, Open Road has proactively built relationships with development finance institutions (DFIs), many of which now bring deals to them due to the red tape involved in the funding process. Additionally, they collaborate on co-loans with other impact investors for deals that exceed their capacity. Caroline notes that the issue of delayed funding is not well-studied, and Open Road’s next phase, operating as a nonprofit, aims to take the lead in building thought leadership. Beyond providing bridge financing, they are exploring ways to encourage policy changes that could speed up the flow of capital.

Resources Mentioned

• Open Road

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• Connect with Caroline on LinkedIn

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