When the Montessori school opened in the early ‘80s, its founders had big dreams.
They envisioned an oasis of learning where students weren’t just trained to pass standardized tests but molded into lifelong learners, where the school could invest in the intellectual, emotional, social, physical, ethical, and spiritual development of each and every child.
Renting a small house to serve as its first classroom, the nonprofit opened its doors with four young students. As word of the forward-thinking school spread, parents rushed to enroll their children. By the end of that first academic year, the class size had quadrupled and it quickly became apparent the school was filling a community need.
Within three years the school built a small campus and was serving two full pre-primary classes and a fledgling elementary class. Demand grew steadily and the school continued to add grades. After several years, they leased a new campus they could grow into room by room. A library. A science center. Art and music classrooms. An entire junior high program, followed quickly by a high school program. The new campus was truly becoming their own.
When the possibility arose to purchase these buildings, Montessori leadership knew they couldn’t pass up an opportunity to create a permanent home for their school. Owning the buildings would provide stability, ensuring they could keep their small class sizes as they grew—a critical element for the child-centered educational experience they valued.
However, they quickly realized this purchase wouldn’t be easy. Since the Montessori school is an independent, nonprofit, tax-exempt organization, public funding was not available. To ensure the school’s future, they resorted to short-term financing to secure the purchase of the buildings.
Though the short-term loan allowed them to make the purchase, the accompanying high interest rates quickly became unaffordable. The leadership team began seeking refinancing options that would ease the financial strain on the school, but quickly found most of the available alternatives were similarly expensive.
The school reached out to the leadership of Semble and we collaborated to create a plan that would allow them to significantly lower their interest rate and payments.
First, to meet the funding goal of $8 million, we worked together to activate the school’s existing community. Through parents, alumni, community members, and supporters, more than $2,700,000 was funded through a social impact loan.
Consequently, this meant the school was able to access a bank loan to fill the funding gap and complete their goal, successfully refinancing the short-term loan. No longer was the school being drained by high interest rates and payments. The new financing package lowered interest costs by more than 50%, saving the school a significant amount each month which they could now use to directly benefit students.
Though the financial savings were significant, the school also saw social benefits. By offering their supporters a socially responsible investment opportunity, they deepened the commitment of the community. Supporters knew their money was going toward a cause they believed in and that it would bring them a financial return. They felt good about being a part of the movement that helped their school.
The school continues to grow to this day and is on track to graduate its first complete high school class in 2017.