Reinventing Prosperity

Creating

1 jobs and

opportunities

in lower

income

communities

2011 Annual Report Results that transcend tough times... percent 8 212 45 percent jobs created million dollars job growth at at PCV companies Wages paid to residents PCV companies of lower income communities

Advice Capital Research

Entrepreneurship — starting and Freeing up capital for small PCV’s InSight program is a growing new businesses — is businesses is a critical step in thought leader in high-impact what creates jobs. But successful stimulating job creation. investing. InSight’s research and entrepreneurs don’t go it alone. analysis educates policymakers, Pacific Community Management, PCV’s Business Advising program investors and business leaders on a PCV affiliate, invests equity in supports entrepreneurs. And not how to harness private capital for small, high-growth businesses just any entrepreneurs, but those verifiable social benefits, as well that deliver exceptional financial who are building businesses that as for financial return. Serving returns and high-quality jobs for have the potential to create good some of the nation’s preeminent lower-income workers. jobs for people in vulnerable institutions, InSight informs communities. This signature Beginning in 2012, PCV’s new diverse constituents on issues program organizes hundreds of Small Business Advising Integrated ranging from health care reform business executives to volunteer Lending program (SAIL) will fill to strategies for uplifting as ad-hoc Boards of Directors, the gap between microfinance disadvantaged communities. mentors and strategic advisors to and large institutional debt by entrepreneurs who are creating offering loans between $50,000 economic opportunities in lower- to $200,000 to small businesses, income neighborhoods. in conjunction with strategic advising.

ReinventingReinventing Prosperity Pacific Community Ventures - 2011 Annual Report Results that transcend Dear Friends,

With your support, in 2011 PCV stepped up our efforts to get people working again. And not just working, but prospering.

To prosper means to flourish; to grow strong and healthy. Prosperity shouldn’t be tough times... for just a select few. With good jobs – those offering benefits and living wages - doors to prosperity can open for everyone. That’s what we mean by “reinventing prosperity,” and it’s what we work to do every day.

Driving capital and resources to lower-income communities remains the cornerstone of PCV’s model for impact. In 2011, that strategy took new shape. Over PCV developed bold new programs and was recognized nationally and globally for our work:

• Small Business Administration (US SBA) awarded PCV $1 million 1,500 to seed a new lending program, which will provide loans of between $50,000 and $200,000 to job-generating small businesses. lower income • PCV made “Impact 30” list featuring the world’s leading social families supported Forbes’ entrepreneurs. • PCV was named Bay Area Nonprofit of the Year by the Association for Corporate Growth. We gained the attention of influential leaders:

• InSight’s report Impact Investing was recommended reading for a White House summit on building an impact economy in America. 3 • PCV was invited to convene a roundtable of small businesses with Congresswoman Nancy Pelosi. • US SBA Deputy Administrator Marie Johns visited a PCV-advised business to learn about our model. 2011 Milestones • Lieutenant Governor provided the keynote at PCV’s Annual Event. • US SBA awarded PCV $1 million With PCV companies employing thousands of men and women in quality jobs, we to seed a new small business have seen more than a glimpse of how reinventing prosperity is possible. loan program. We are also distinctly aware that our work is not done. PCV will build on this • Business Advising matched 135 momentum in 2012 and beyond. companies with 197 volunteer advisors. With warm regards,

• InSight measured the social impact of over $1.3 billion of private equity investments.

• PCV’s affiliated equity funds successfully sold Galaxy Desserts, providing positive financial returns to investors and social impact to the Bill Pace, Beth Sirull, Eduardo Rallo, community — 33% job growth Board Chair Executive Director Managing Partner Pacific Community Pacific Community Pacific Community during investment and 86% of Ventures Ventures Management employees sharing in the sale profits. Creating Jobs

Pacific Community Ventures

PETIT COLLAGE Advice Modern, handcrafted décor for kids Petit Collage’s eco-friendly, vintage- Kicking off with a strategy roundtable, a Following are just inspired room décor and accessories crew of PCV volunteer advisors identified have captured the hearts of parents key issues for Petit Collage to address in a few examples everywhere, as well as the attention of managing its growth. Following that initial tastemakers such as Martha Stewart and session, four volunteers devoted one-on- of successes from . one time to the business. From developing

a granular budget to analyzing operational percent Owner and designer Lorena Siminovich structure, to setting up HR systems for had been building Petit Collage steadily the year. proper compliance, PCV advisors spent for five years when she realized the 40 hours supporting Lorena and her team. business was experiencing growing pains. The -based By the end of 2011, with solid systems company’s increasing popularity in place and the confidence to manage required a sustainable strategy and continued success, Petit Collage doubled Lorena reached out to PCV for support. the workforce of its Mission-district headquarters.

Reinventing Prosperity Pacific Community Ventures - 2011 Annual Report Saving Jobs

CIRO’S LANDSCAPING Landscape design, installation and maintenance

Ciro’s Landscaping owner Ciro was determined to deliver a better Delgadillo had a succession plan in outcome. Knowing Ciro’s Landscaping place and was preparing to retire needed business expertise to confront from his successful business when the many challenges ahead, CDC the recession hit. With large loans brought in its integrated partner, PCV. on two commercial properties and PCV worked with Delgadillo to model business dramatically slowing, Ciro realistic business projections and suddenly found himself considering develop a plan for leasing his excess the unthinkable - dissolution of his commercial space. PCV provided decades-old family business. sound guidance and asked the Ciro’s turned to the originator of his hard questions. The organization Small Business Administration loan, also worked in tandem with Ciro’s San Diego-based CDC Small Business Landscaping and CDC to help the Finance, for help. After reviewing the company restore its real estate debt business’ new operating realities, CDC payments and its credit.

With the company’s properties leased and utilized, a reoriented business strategy, simplified business offerings, and a full complement of 30 employees, Ciro’s Landscaping is on solid financial 5 footing and growing again.

“PCV’s help is a combination of top-notch communication and percent 50advice, combined millionwith a real, Amount PVCdown-to-earth companies paid to residents of lower income communitiesapproach. in ” CaliforniaLorena Siminovich, Founder and CEO Petit Collage “PCV’s investment enabled Galaxy to grow profitably and add sustainable, quality jobs for local Richmond residents.” Paul Levitan, CEO Galaxy Desserts

Pacific Community Ventures Capital

Investing for Financial Return and Social Impact

GALAXY DESSERTS Exceptional, French-style treats

Call it a sweet deal for all involved. The almost double that size and enlarged its recent sale of Galaxy Desserts not only staff, enabling a sales increase of 80%. returned attractive financial returns for Located in the East Bay port city of investors, but also delivered sizeable social Richmond, Galaxy prides itself on fostering impact, creating quality jobs for Galaxy’s an entrepreneurial culture, with numerous diverse workforce of 163 self-described instances where part-time employees grew “dessert-lovers.” into senior operation roles. That company Over the course of PCV’s investment, culture continues with the new owners, Galaxy grew its jobs by 33%, increased Brioche Pasquier. health care and retirement benefits This French family-owned group will join for employees, and 86% of workers forces with Galaxy chef Jean-Yves Charon participated in the sale via stock options and CEO Paul Levitan to add Galaxy’s and profit-sharing opportunities. talent and exceptional products to the When the PCV growth equity team French brand, as well as to introduce originally invested in Galaxy Desserts, the Brioche Pasquier to the American market, company was working out of a 36,000 all while continuing to provide quality jobs square-foot facility. With PCV investment for local residents. funds, Galaxy built a production facility

Reinventing Prosperity Pacific Community Ventures - 2011 Annual Report Pacific Community Ventures Research Whether the results inform strategies to bring economic opportunity to struggling communities or affordable health care to the uninsured, PCV InSight works to advance policies that encourage private capital to invest for social benefit as well as financial return. In 2011, InSight’s influence resonated on state, national and international levels.

Thriving societies Healthy workers and families The measures of social progress 7 7 The resources of government and With more than two million Californians As part of its consulting to assess the philanthropy alone are insufficient to without health insurance living in a social performance of investments for address the world’s biggest problems. household headed by a small business institutional clients, InSight produced one This was the premise in mind when employee, InSight has leveraged PCV’s of the most comprehensive and innovative InSight and its collaborator, the Initiative invaluable entrepreneurial networks to reports in the world, measuring the for Responsible Investment at Harvard play a pivotal part in understanding how impact of the Public Employees University, with funding from the the nation’s new health care law can Retirement System’s (CalPERS) $17 billion Rockefeller Foundation, embarked on an extend coverage to more working people. of investments within California. investigation into the power and scalability InSight’s report - Health Care and Small InSight’s report detailed numerous social of impact investing. Business: Understanding Health Care benefits of the statewide investments, Impact Investing: A Framework for Policy Decision Making in California - revealed opportunities that will fuel California’s Design and Analysis – launched last year in how small business owners navigate future and create the jobs of tomorrow. New York, Washington, D.C., and London the health insurance market and make For Community Development Financial – examines how governments from Kenya decisions about coverage for their workers. Institutions (CDFIs), positively affecting to Peru to the United States and beyond The influential California Health Benefit community and economic development are catalyzing investments that result in Exchange, charged with implementing the in underserved markets is paramount, financial return and positive social benefits. reform law in the state, invited InSight to and measuring the impact of CDFI The study has stimulated additional efforts be only the second external organization investments is becoming increasingly vital. in the field, including: privileged to present research and In 2011, InSight was commissioned by recommendations to its Board. • InSight’s report was recommended Neighborhood National Bank (NNB), a reading for a White House summit on nationally recognized CDFI, to measure Building an Impact Economy in America. its impact in greater San Diego, a region PCV’s Beth Sirull and Ben Thornley were encompassing areas with high poverty two of approximately one hundred and and high unemployment. InSight’s report fifty leaders invited to the D.C. summit. illustrates NNB’s leadership in the region as a depositor and provider of capital • InSight convened a meeting of 30 to businesses and individuals in areas policymakers, advocates, and researchers overlooked by traditional banks. from 9 countries to share intelligence Photo Notes on the ways governments can, and Left: Entrepreneurs and guests at PCV’s Annual Showcase Center: Cover of 2011 report, Health Care and Small should, encourage private investment in Business underserved markets. Right: Ben Thornley presents InSight report in Sacramento Pacific Community Ventures 2011 Impact

Driving Economic Recovery Providing Access to Health Care Pacific Community Ventures spurs economic growth by helping small businesses grow and and Financial Security create jobs in lower-income communities, driving economic recovery in the neighborhoods that Health insurance premiums in California need it most. In 2011, PCV companies created 212 new jobs, growth of 8%, — compared to 2% job increased over 8% in 2011, outpacing growth in the state and nation. 1 inflation and making health benefits less affordable.6 As a result, the proportion of PCV worked with 19 partner economic development organizations and 145 small businesses PCV companies able to offer this benefit to through our Business Advising program and affiliated equity funds. Our volunteer business their employees has been steadily declining. advisors donated almost 2,000 hours of their time to provide guidance and expertise to In 2011, 49% of PCV company employees entrepreneurs and small businesses. PCV InSight measured the impact on underserved were eligible for health care coverage. communities of over $1.3 billion in private capital invested in small businesses, further PCV companies that offer coverage pay an demonstrating the viability of high-impact investing in lower-income communities. average of 70% of employee premiums. Companies receiving business advising services from PCV experienced a significant increase Recognizing the challenges small businesses in employment last year with over 14% job growth.2 Over half of the nearly 3,000 employees of face in providing health care coverage to their PCV companies were residents of lower-income communities.3 And PCV’s Business Advising employees — and that the majority of the program is cost-effective — for every $3,000 spent on the program, a new job, paying an working uninsured are employees of small average wage of $38,000 per year, was created at a participating company in 2011. In total, PCV businesses — PCV set out to influence health companies paid $45 million in wages to residents of lower-income communities in California. care policy in 2011. PCV InSight completed a landmark study entitled Health Care and Small Business: Understanding Health Care Pacific Community Ventures 2011 Impact Summary Decision Making in California. This work enabled policy makers to better understand TOTAL how to engage with small businesses and Number of companies supported 145 increase the likelihood that business owners will choose to offer health coverage to Total employees supported 2,719 their employees. PCV was one of just two Average number of employees per company 19 organizations invited to present this work to Net new jobs created 212 the California Health Benefit Exchange, the Annual employment growth rate 8%4 agency charged with implementing health Low- and moderate-income employees as a care reform in the state.

5 percentage of the total workforce 57% PCV also works with the companies in which Total wages paid by PCV companies to residents it makes a financial investment to reserve of lower-income communities $45 million a portion of company equity for lower- income workers. As showcased on page 6, Generating Paychecks over 85% of Galaxy Desserts’ employees More than half of PCV companies pay their lower-income workers (10th and 25th percentile are sharing in the profits of the company’s earners) more than lower-income workers in comparable California companies. These recent sale. These equity set-aside programs companies recognize the benefits of paying superior wages in terms of reduced turnover enhance employees’ long term economic resulting in lower recruiting, hiring and training costs. self-sufficiency even as they improve productivity and morale. $16

$14 $28,200/year $25,500/year $25,300/year PVC portfolio $12 $21,700/year companies pay $10 workers higher average wages $8 than California companies in $6 comparable $4 industries. $2

$0 10th Percentile Wage 25th Percentile Wage

PVC Portfolio Companies California Companies in Similar Industries

Reinventing Prosperity Pacific Community Ventures - 2011 Annual Report Pacific Community Ventures - Creating Jobs 2007-2011

16% 15% 12%

10% 9% 8%

5% 3% 2% 2% 1% 1% 0% 0% 0%

-3% -4% -4% -5% -5% 9 Percentage Employment Growth Employment Percentage / Loss -10% 2007 2008 2009 2010 2011

Creating Jobs Overall job growth in 2011 at PCV companies outperformed the U.S. and California private PCV Portfolio sectors. PCV companies increased employment by 8.4% compared to the US and California, United States where private sector employment grew just 2%.7 Over the last five years, PCV companies California have consistently outpaced the general economy, achieving superior job growth. Business Advising

Investment Services

Preventing Foreclosure/ Helping the Underserved Retaining Jobs PCV companies provide employment to In 2011, PCV continued its partnership with a total of 2,719 workers. Over half (57%) CDC Small Business Finance in San Diego of these employees are defined as low- to provide business advising services to to moderate-income from underserved Middle/ Low/ small business owners with commercial real communities across California. Upper Moderate Income Income estate debt facing foreclosure. PCV was The companies that PCV advises employ a 43% 57% able to work with small businesses, lenders diverse workforce. Female employees make and the Small Business Administration to up 44% of workers, 36% are Hispanic or avert foreclosure on nearly $20 million in Latino, 13% are Asian/Pacific Islanders, 3% debt, saving over 250 jobs. In 2012, PCV are African-Americans, and 2% are either will continue to partner with CDC Small multi-racial or another ethnicity. Economic Status of Business Finance and other lenders to advise Pacific Community Ventures these at-risk small businesses, preventing Portfolio Company Employees 8 business foreclosure and job loss. For methodology and footnotes please see the online version of this report at www.pacificcommunityventures. org/annual-report.pdf. “You can’t imagine how much the family and myself appreciate what you and your group are doing for us. We will not let you down.” Gaston A. Monast, European Hardware and Finishes dba Gerber Hinge Company, PCV Business Advising Client

Staff PCV Board of Directors 2011 Donors Pacific Community Ventures Chris Andersen Institutional Contributors Chase Adam Atlas Capital Strategies $50,000 - $999,999 Lending and Marketing Associate Ralph Clark Bank of America Foundation Carolyn Clarke Shotspotter Director, Finance and Lending Initiatives California Endowment Bud Colligan Citi Foundation Allison Kelly Accel Partners and Co-Founder of Statewide Director, Business Advising Pacific Community Ventures Community Development Financial Institutions Fund Shaffer McGee Judith Goldkrand RS Group (Hong Kong) Finance Manager Wells Fargo Bank N.A. Rockefeller Foundation Shawn Nguyen Linda S. Graebner William Randolph Hearst Foundation Office Manager Chef’n Corporation

Kendra Ott PCV Board Secretary $25,000 - $49,999 Program Manager, Business Advising Mathilda S. Khabbaz Annie E. Casey Foundation Amelia Pentecost Citibank N.A. Charles Schwab & Co. Program Coordinator, Business Advising Paul Levitan Wells Fargo Foundation Sarah Ritter Galaxy Desserts

Project Coordinator, InSight Lisa Maibach $1,000 - $24,999 Rebecca Shepherd Spencer Stuart Analyst, InSight William B. Pace ACG San Francisco, Inc. Chuck Sinks Pacific Community Ventures, Chairman Bubbies of San Francisco Regional Director, Business Advising Teresa Pahl CDC Small Business Finance Beth Sirull Hanson Bridgett, LLP Charles and Edna Levine Family Executive Director Beth Sirull Foundation Ben Thornley Pacific Community Ventures College Access Foundation of CA Director, InSight Comerica Bank Equator Estate Coffees Meredith Willa Advisors to the Board of Directors Project Manager, InSight Fenwick & West, LLP

Tom Woelfel Jim Wiggett Friedman Family Foundation Project Manager, InSight CEO & President, Jackson Hole Group Hanson Bridgett, LLP

Aida Alvarez Pacific Community Management Administrator, US Small Business Administration (Former) Ariel Jaduszliwer Associate

Peter Mehrberg Managing Director

Eduardo Rallo Managing Director

Yolanda Ruiz Partner

Reinventing Prosperity Pacific Community Ventures - 2011 Annual Report “You can’t imagine how much the family and myself appreciate what you and your group are doing for us. We will not let you down.” Gaston A. Monast, European Hardware and Finishes dba Gerber Hinge Company, PCV Business Advising Client

Morrison Foerster, LLP Amanda Bass Eduardo & Sylvia Rallo New Resource Bank Karen Burns Arthur & Toni Rembe Rock San Diego Gas & Electric Donald G. Butler Melissa Rich Sensiba San Filippo, LLP Carolyn Clarke Susan Shargel SFMade Maria Cleaveland Robert Sher Silicon Valley Bank Jeremy Crawford Lorena Siminovich Spencer Stuart Kristin Daley Taz Singh The Upjohn Fund of San Francisco Robert Davenport C.J. Spady Union Bank of California N.A. Todd DeMann Adam Straus U.S. Bank N.A. Betsy Fields Robert Unsworth Neil Figurelli Sally Van Doren Individual Contributors Kirsten Fisher Christa Velasquez $25,000+ Brent Franson John Volk Maureen Futtner Timothy Volkema Bud and Rebecca Colligan Justin Gagnon Jim Wiggett Bill and Betsy Pace John Hessen Hugh Williams Dan Hirsch Lynne Winslow $10,000 - $24,999 Michelle Horneff-Cohen Dan Hunter Gordon & Carolyn Davidson Zina Kao Linda Graebner Elaine Katzenberger Susan M. Klein $1,000 - $9,999 David Krishock 1111 Deb and Tony Clancy Peter Langenstein Lisa Colligan Mae Ling For every Zander Lurie Hanmin Liu Lisa Maibach Chri Longstreet $3,000 spent Lore Harp McGovern Jayne Matthews Beth Sirull & Jonathan Shuster Beth Miles on PCV’s Michael Torres Sheila Moon Leigh Morgan Business Advising $250 - $999 Zachary Mutrux Keith Abrams Program, a new job, Vince Olson Scott Allen Thomas Ortenzi John Arensmeyer paying an average Vinay Pai David Bank Robin Petravic wage of $38,000 Jack Bertges Stephen Shoup per year, was created at a participating company in 2011.

“PCV InSight and IRI are well-positioned to grow the field and help drive capital to address some of the world’s most intractable problems.” Judith Rodin, President of the Rockefeller Foundation

Bay Area Advised Companies Paresh Martial Arts 9 Electro Surface Technologies 2 Parties That Cook Entech Environmental 2 2Tog Inc., dba Zina Kao Exclusives, Inc. Performance Based Ergonomics 9 ESI Contracting 2 3BL Market 1 Petit Collage, Inc. 9 Express Automotive Enterprises 2 3BLTech LLC - Papila Fundraising Software 6 Potter’s Crackers Gerber Hinge 2 Bicycle Coffee, LLC 4 Precious Moments Family Daycare 9 Hichborn Consulting Group 2 Brix 26 Property Management Systems Highest Bidder 2 Bubbies of San Francisco Pyramind 6 Hi-Teck Auto Repair 2 Casablanca Market 9 RGB Shop + Gallery 9 Invisible Touch 2 City Lights Books Ritual Roasters 8 Marlin Machine Products 2 Complete Party Supplies, LLC 9 Robindira Unsworth Jewels Mendeola Transaxles, Inc. 2 CORE Foods, LLC 9 2 6 San Francisco Sewing and Quilting Murphy Mechanical Dawson Custom Workroom 7 Collaborative Omega Industrial Marine EDO Salon 9 Sarah Becker Skincare P. Timothy Pittullo, APC 2 Equator Coffees & Teas Sarai, LLC Painted Rhino 2 Espress Yourself 7 Ses Petites Mains 9 Panama Hospitality, LLC Fabkins 6 Sheila Moon Athletic Apparel, LLC dba Howard Johnson Hotel 2 Fitiquette 6 Siteler Wash Parisian International 2 Flora Grubb Gardens (Grubb & Nadler, Inc.) Straus Events PB Bar & Grill 2 6 Fog City Tutoring & Academic Services 9 Taylor Stitch Pressline Ink and Supplies 2 From the Fields The Cheese School Promex Automotive 2 Future of Fish 3 The Love & Hummus Co. Quantum Press 2 Gallofornia Getta Grip Sewing Clip 9 The San Francisco Lesbian Gay Bisexual Radio Active 2 Gama-Go Trasgender (LGBT) Community Center RNX International 2 Gentle Parking, LLC 5 TMC Working Solutions Sanborn A/E, Inc. 2 Glass Plus, Inc. 9 To-Go Ware Savannah Grill 2 Heath Ceramics 9 Twisterz Toys Sierra Pacific Fleet Services2 8 Hello!Lucky 9 Urban Bazaar SK Furniture 2 House Kombucha Viva el Español Skipco Grading & Paving, Inc. 2 Ineke Perfumer 9 Winslow & Associates Spirit Graphics and Printing 2 InterSchola Wireless Voice & Data, Inc. Sun Boss 2 7 Jebena Coffee and Tea Co. 6 Woolbuddy Sunwest Pool Safety (aka All-Safe Pools) 2 Joshu-Vela 9 Worldwise Education, Inc. Telecom Logistics 2 Kasa Indian Eatery 11 Yes Enterprises Walard Enterprises, Inc. 2 Kidspace 6 Yes V Can YMZA Group, Inc. 2 3, 9 Kika’s Treats Youth Media International 11 Koco Sky 9 PCV Partners Libaire Leather, Inc. San Diego / Los Angeles Little Spark Media 6 Advised Companies B Corporation Marin City CDC CDC Small Business Finance 2 ModCell Aedifice Architecture Goodwill Industries 2 Noyes-Works 10 Anaheim Rent a Car Inner City Advisors 2 OBDC Small Business Finance Answer Industries Jewish Vocational Services 2 Pachamama Coffee Cooperative 1 A-Plus Properties La Cocina 2 Pacific Community Ventures ARC Roofing MANEX 2 Pacific Shaving Company Audio Crafters OBDC Small Business Finance 2 B Street Express Car Wash Office of Small Business, San Francisco BS Hand & Sons, Inc. 2 City Hall Legend Business Communications Solutions 2 Opportunity Fund 1 B Corporation 2 2 CDC Small Business Finance C&G Petroleum Renaissance Entrepreneurship Center 3 La Concina Canyon Pottery, Inc. 2 RSF Social Finance 4 New Resource Bank Carson Valero 2 5 Opportunity Fund SF LGBT Center 6 Renaissance Entrepreneurship Center China Pavilion 2 SFMade 7 SF LGBT Center Ciro’s Landscape 2 TMC Working Solutions 8 SFMade 2 9 TMC Working Solutions Corn Maiden Urban Solutions 10 Women’s Initiative for Self Employment CR Studio 4 2 Valley Economic Development Center 11 Zero Divide Discount Glass & Mirror 2 Women’s Initiative for Self Employment D’Mundo Tile 2 Zero Divide Earth Support Systems 2

Reinventing Prosperity Pacific Community Ventures - 2011 Annual Report “PCV InSight and IRI are well-positioned to grow the field and help drive capital to address some of the world’s most intractable problems.” Judith Rodin, President of the Rockefeller Foundation

InSight Clients Anne Bisagno Mike Garrabrants Xantrion ArtesynIP California Public Employees Retirement System Jonathan Black Andrew Giacomini Inter Core Media Hanson Bridgett, LLP The Rockefeller Foundation Joan Bodensteiner Daniel Gloates The Annie E. Casey Foundation Socialcast The Orphanage The California Endowment Steve Bowling Linda Graebner The Northwest Area Foundation Retired / Consultant Chef’n Corporation Hamilton Lane Leslie Brand Paul Graven Macquarie Funds Management Wheelhouse Solutions Cateni Neighborhood National Bank Chris Braun John Gray Consultant Bubbies of San Francisco Fund Companies Tom Brehme Gary Groff BlockWild, Inc. New Resource Bank Adina for Life, Inc. Rick Brown Jeffrey Gustafson Bentek Energy TerraVerde Renewable Partners Consultant Evergreen Lodge Rick Brusseau Kyle Haas Freshology Sea View Partners Charco Investments, LLC Galaxy Desserts Maureen Burke Seth Halio New Leaf Paper Tatum Novariant, Inc. Pacific Catch Carolyn Carpeneti Mark Hamachek Pacific Pharmacy Bialla & Associates Consultant SABEResPODER Eric Chen Lisa Hannah Zoom Eyeworks WI Harper Ageless Beauty Spas 13 Lisa Chow David Healy In-Kind Sponsors Palimin National Football League Christine Ciandrini Dan Heller Adina for Life, Inc. Saas Corporation DZH Phillips, LLP Beringer Andrew Constantin Jayne Hillman Flora Grubb Gardens (Grubb & Nadler, Inc.) Constantin Partners Launch Community Ventures Galaxy Desserts Jack Cortis James Hipkin Heath Ceramics Consultant Red8 Studios Playa Viva John Dare Robert Holden Yes V Can Dare Consulting New Resource Bank Peter David Henry Hank James Media Sponsors CFO Services - RHI/Protiviti WealthTrax, Inc. 7 X 7 Magazine Donna Davis Gregory Johnson It’s Time 2, Inc. California Home & Design Clayton Partners, LLC CBS 5 Santino DeRose Clay Jones DeRose & Appelbaum Presidio Bank San Francisco Business Times The Bay Citizen John Doyle Kiran Kadambi Fountain Partners eBay Dianne Dubois Daniel Katsin Bay Area Volunteer Advisors Maple Street Associates KDS Marketing Solutions Leon Allen Leah Edwards Daniel Kavanaugh Consultant Edwards & Co. Daniel M. Kavanaugh, CPA Chris Andersen Liz Einbinder John Keenan Atlas Capital Strategies Liz Einbinder Consulting Cisco Systems, Inc. Ken Ansin Mark Farrell Leslie Keil Ansin Consulting Group San Francisco Supervisor Hanson Bridgett, LLP Joe Anzalone Maryanne Flynn Allison Kelly New Resource Bank Cisco Systems Pacific Community Ventures Deborah Armanino Jennifer Forster Eric King Armanino Foods of Distinction, Inc. Postcouture, Inc. SocioGramics Jeffrey Barney Anna-Lisa Froman Jodi Klein Kane and Finkel, LLC Commerce & Style Klein Consulting George Beardsley Sasha Froyland Hulya Koc Quality Earnings Strategic Enterprise Solutions, Inc. Childcare Careers Aparna Behari Maureen Futtner Jules Kragen Apple Computer, Inc. P.R. for the People Food Forward “What really resonates with me about PCV’s mission is working with small businesses and creating jobs for the people who need them most.” Jeff Gustafson, PCV Volunteer Advisor

Kirsten Kuhlmann Jim Presley Daniel Wiggins Apollo Group Verge Innovation Group, Inc. Zynga Aaron Lamstein Kathy Prestigiacomo Hugh Williams Alea Group, LLC Morgan Stanley Continental Painting & Decorating, Inc. Ellen Lee Eduardo Rallo Erika Williams RS Investments Pacific Community Management The Erika Williams Group Jack Lieberman Larisa Rapoport Jude Winterhalter BizCap DZH Phillips, LLP Pennbrook Insurance Services Mac Ling Gregory Rea Peter Josh Wolf iCrossing Union Bank of California N.A. Intel Corporation Alex Long Robin Robinson Keith Zachow Consultant Bell Carter Foods, Inc. Omega Valuations, Inc. Kyle MacLeod Yolanda Ruiz Moss Adams, LLP Pacific Community Management San Diego/Los Angeles Lesley Mansford Matthew Sade Scott Arnold Razoo Fork in the Road Foods NextGen Healthcare Info Systems Bradley Mart Alan Saldich Mike Bourne, CPA FogBusters, Inc. WeCare Solar Atessa Benefits, Inc. Christine Martin Tony Salmaso Shelby Brown, JD. LL.M Style & Entertaining Silicon Valley Bank Diversify Film Group, LLC Amy Matthews Richard Schmidt Andrew Buckland Amy Matthews Executive Search Consultant PURE Bioscience Jeffrey Mazer Roger Sexton Blair Cannon Bank of America / Merrill Lynch Heath Ceramics Bernstein Global Wealth Management Peter Mehrberg Dan Shapiro Rich Canote, CPA Pacific Community Management Wells Fargo Bank N.A. CPA Private Practice Robyn Miller Robert Sher Nishad Chande Robyn Miller Consulting Alliance of Chief Executives, LLC Centre Partners Kathryn Money Steven Sherman Gary Correia, CPA Orion Telescopes & Binoculars Sherman Business Law Tailor Guitars Michael Moradzadeh Sanjay Sinha Andy Frank Rimon Law Group, Inc. California Bank & Trust Consultant Leigh Morgan Chuck Sinks Dolores Chavez Harmes, PA Genentech Pacific Community Ventures Chavez Finalcial Offices Rick Moss Geoff Skigen Raj Idiculla Hub Ventures Motivate, LLC Fervor Holdings, Inc Leslie Bandow Murphy Scott Smith Wally Johnson Ancestry.com Hanson Bridgett, LLP White Horse Management, LLC Arturo Noriega Philip Smith Tim Ludwig Centro Community Partners Consultant Ohana Capital Michael O’Leary Eric Spector William “Bill” Parker Accelerate Sales OneRoof, Inc. Tara Jayde Capital Partners, LLC Sharon Olexy Stan Springel Tyler Pruett Bytes2Insights Consultant Halifax Group Tom Ortenzi Padmini Srinivasan Ruben Recio AFE Consulting Audubon California Operations Consultant Teresa Pahl Kirsti Tcherkoyan Andrew Ruff Hanson Bridgett, LLP Diablo Solutions TGG Accounting Karen Pajarillo Paul Terry Xavier Sheid Riverside Company Paul Terry & Associates The Focus Group, Deb Parsons Ray Villaman Real Estate Investment Development WomenCare Global Tahoe Restaurant Group Darren Solomon Daniel Paul John Vitti Kid Ventures Launch Squad Mobile Spinach Derrick Wong Danielle Petersen Dave Weil Celtic Capital Corporation Wantful Solairus Aviation Kathleen White Consultant

Reinventing

Prosperity Pacific Community Ventures - 2011 Annual Report “What really resonates with me about PCV’s mission is working with small businesses and creating jobs for the people who need them most.” Jeff Gustafson, PCV Volunteer Advisor

Pacific Community Ventures 2011 Financials PCV’s 2011 financial statements reflect an organization committed to sound fiscal management, bolstered by a diversified stream of revenue, including mission- driven earned income. With the organization’s cost-effective strategy to support job creation in lower-income communities, PCV maximizes every dollar earned InSight and donated. Business Advising

Investment Services

General & Admin Expenses by Category 2011 fundraising

General & Administration 9% —

Program: Fundraising 4% — — Investment Services 41%

15

Program: InSight 27% —

Program: — Business Advising 19%

General & Administration General & AdministrationTotal Expenses – $3,062,136

Sources of Revenues 2011

— Individual 5% Fund Returns & — Other 2% Management Fees 34% — — Foundation 9% Help Create FUND RETURNS/MGMT FEES

— Board Directed a Job Today Investments 2% INSIGHT PleasePROJECT consider contributing to — Corporate 4% PCV to help us reinvent prosperity. GOVERNMENTFor more information, visit www.pacificcommunityventures.org/donate. Insight Project Fees 17% — CORPORATE — Government 27% BOARD DIRECTED INVESTMENTS

Total Revenue – $3,744,769 FOUNDATION

OTHER FEES

INDIVIDUAL Methodology and Footnotes for 2011 Annual Report

1 PCV’s rate of annual job growth LMI Methodology LMI Analysis Update is based on responses from 68 The percentage of employees defined The analysis of low- to moderate- companies that received assistance as LMI is based on employee wage income (LMI) ZIP codes has been through PCV’s Business Advising and residence data (ZIP code) from updated in this year’s report to reflect Program and 10 companies receiving 56 companies, including 10 companies the release of 2010 US Census Bureau equity investment through Pacific receiving private equity investment and and 2009 American Community Community Management. U.S. and 46 receiving business advising services. Survey data. For prior years of analysis, California employment growth data this research utilized 2000 US Census is from the Bureau of Labor Statistics. PCV companies provide the ZIP code Bureau data for determining LMI ZIP www.bls.gov/ces. Accessed 3/5/2012. for each headquarters location, as well codes. The 2010 US Census Bureau as for each employee. While employee and 2009 American Community 2 Annual job growth is based on data and headquarters locations are defined Survey data reflects socio-economic from a sample of 66 companies that by ZIP codes, LMI areas are identified changes over the last ten years in the received assistance through PCV’s by census tracts. ZIP codes can consist communities of the United States. Business Advising Program. of parts of many census tracts and These changes can be observed in the census tracts can contain parts of proportion of zip codes now defined 3 The percentage of companies several ZIP codes. PCV defines an LMI as LMI, particularly in California. The located in LMI areas is based on data ZIP code as one that is predominantly percentage of California ZIP codes from a sample of 145 companies, (50 percent or more) comprised of LMI defined as LMI has decreased from including 135 companies that received census tracts. 55 percent using 2000 Census business advising services (52 of Data to 38 percent using 2010 U.S. the 135 received business services in A census tract is designated LMI if at Census Bureau and 2009 American partnership with CDC Small Business least one of the following conditions Community Survey data. This decrease Finance) and 10 companies that holds true: reflects a greater concentration of received equity investment. • For census tracts within relative economic disparity that is metropolitan areas, the median less widely dispersed geographically Total number of employees (2,719 income of the tract is at or across California. Consequently, the employees) is based on a sample below 80 percent of the percentage of companies located of 78 small businesses, including 10 metropolitan statistical area in LMI communities, and employees companies receiving private equity median. For census tracts outside defined as LMI, in this year’s report investment and 68 receiving business of metropolitan areas, the median cannot be readily compared with prior advising services (21 of which received income of the tract is at or below year’s reports. services in partnership with CDC Small 80 percent of the statewide, non- Business Finance). metropolitan area median 4 Net new jobs created is based income. on responses from 68 companies • At least 20 percent of the receiving business advising services population lives in poverty. and 10 companies receiving private • The unemployment rate is at least equity investment through Pacific 1.5 times the national average. Community Management.

Reinventing Prosperity Pacific Community Ventures - 2011 Annual Report 5 Based on data from 10 companies receiving private equity investment and 46 companies receiving business advising services that reported employee wage and residence data.

6 California Health Care Foundation. Employer Health Benefits Survey, December 2011.

7 Bureau of Labor Statistics. www.bls. gov/ces. Accessed 3/5/2012.

8 Low- and Moderate-income workers earn a low or moderate-income wage, and live in a zip code that is made up of low/moderate-income census tracts. These workers earn less than the median family income (MFI) for 17 the metropolitan statistical area (MSA) they live in.

Middle/Upper-income workers earn a middle or upper-income wage, or live in a zip code made up of middle/ upper-income census tracts. These workers earn more than 80% of the median family income (MFI) for the metropolitan statistical area (MSA) they live in. Similarly, employees who earn 80% or less of the MFI for the MSA but live in a zip code entirely composed of middle and upper-income census tracts are also considered middle/upper-income. Workers living in upper-income census tracts that earn a lower-income wage are included in this category as they are likely part of a household with another source of income, or would not be able to afford to live in the neighborhood. Pacific Community Ventures builds responsible small businesses to create jobs and opportunities in lower-income communities.

General Contact Information [email protected] pacificcommunityventures.org

San Francisco Office 51 Federal Street Suite 100 San Francisco, CA 94107 phone (415) 442-4300

San Diego Office 2448 Historic Decatur Road Suite 200 San Diego, CA 92106 phone (619) 818-6872

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Reinventing Prosperity Pacific Community Ventures - 2011 Annual Report