Nico Echo Park is a benefit corporation

Author: ameetess
Date: February 17, 2020
“Sculpting Another Destiny” mural by Ricardo Mendoza on the corner of Sunset Boulevard and Echo Park Avenue

What’s a benefit corporation and how does it impact my investment?

We love neighborhoods. That’s why when we created Nico Echo Park, we chose to organize it as a benefit corporation. 

A benefit corporation is a for-profit entity that is legally obligated “making a material positive impact on society and the environment.” Benefit corporations (also known as Public Benefit Corporations, or PBCs) are a relatively new type of company that is intended to produce a public benefit and to operate in a responsible and sustainable manner. One of the conditions to be a benefit corporation is a requirement to publicly report on the social and environmental impact that the company generates. Other well-known benefit corporations include Patagonia and Kickstarter.

Is this the same as being a Certified B-Corp?

This is slightly different than a Certified B-corp, which is a related voluntary certification (we are also a certified B-Corp!). A benefit corporation is a designation that is built to the corporation’s structure and is legally binding, whereby being a Certified B-Corp is a voluntary certification that is designated by the non-profit B Lab.

Nico Echo Park is a certified B-Corp

Why is Nico Echo Park organized as a benefit corporation?

We’re committed to preserving and enhancing the social, physical, and environmental aspects of a neighborhood. So when you make an investment in Nico Echo Park, you’re also supporting a company that is committed to contributing to positive outcomes for local residents, community organizations, and small businesses. 

We elected to organize Nico Echo Park as a benefit corporation because we believe that investments should be measured in a way that gives due weight to their impact on people and communities. Organizing Nico Echo Park as a benefit corporation is a critical step that will allow us to meaningfully shift how we measure success to be more aligned with human outcomes for our stakeholders. 

Since this is a new model for community participation in investing that measures success differently, we are building a culture of learning to evolve and adapt the model to what is working (or not), and allow ways for stakeholders to provide input and help inform the process over time.

How will Nico Echo Park measure its impact?

Nico’s Social Impact Assessment Framework is the logic for how we will work to achieve our vision of positive social and environmental change.

Nico’s model and operations focus on 5 main impact areas:

  • Increased financial inclusion and wealth creation
  • Distributed power and stakeholder alignment
  • Improved environment and quality of life
  • Neighborhood diversity and stability
  • Strong local economy

Nico will rely on the following data sources to measure the company’s  impact on its stakeholders:

  1. Local stakeholder input: Nico values first-hand feedback from local stakeholders, including residents of Nico Echo Park owned and managed buildings and local shareholders. We are providing multiple options for local stakeholders to help assess progress towards achieving our desired impact through surveys, one-on-one meetings, and feedback forms.
  2. Partner input: Nico will also solicit input from our partners and neighbors, including local business owners, community-based organizations, elected officials, and local institutions through neighborhood events, surveys, and meetings.
  3. Operational data: Nico will also use operational data such as the total number of local shareholders, total equity invested by local shareholders, number of building improvements performed, energy savings, or the number of residents engaging with the model to track our impact.

How will this impact my investment and returns?

We believe that strong, stable neighborhoods where many local stakeholders are able to invest and participate in wealth that is created through investment in local real estate will increase in value and utility to local stakeholders over time. This will happen when the local stakeholders and shareholders are given a more inclusive, accessible and flexible way to participate in defining Nico Echo Park’s long-term strategic goals. These goals will then help guide the ongoing data collection and measurement.

Nico Echo Park is committed to a stakeholder engagement framework that will ensure residents, local shareholders, and other neighborhood stakeholders are able to weigh in on issues that are important to them. We’ll be able to offer multiple ways to participate including in polls, surveys, one-on-one meetings, events, workshops, and more.

Here’s to a fairer and more inclusive way to invest in local real estate and build community wealth!

Still got questions about Nico Echo Park being organized as Benefit Corporation? No worries, we’ve got you covered! You can read our Social Impact Assessment here or reach out via our contact us page and we’ll answer your questions.