A social impact financial technology startup with Milwaukee ties is planning a $2 million pilot program to finance up to 20 affordable housing units in Milwaukee, according to a Thursday announcement.
The program is led by Teresa Esser, managing director of community banking for Rallius by ESG Financial Inc., a startup building a digital banking platform focused on environmental, social and governance (ESG) initiatives. Esser was formerly the managing director of Milwaukee's Silicon Pastures Angel Investment Network.
Rallius is piloting the program in partnership with the Rotary Club of Milwaukee Inc., of which Esser is a member.
In choosing a location for the pilot, Rallius is exploring Milwaukee neighborhoods, including Lindsay Heights, Harambee and Sherman Park, Esser said. It's considering both new builds and refurbishments and hopes to begin "soon after the ground thaws" in late spring or early summer, she said.
The program will be financed through an equity investment from Rallius and a bank loan, Esser said. The startup is also reserving space for local grant makers and impact investors who want to participate.
"We are hoping that other community leaders will be inspired to join the project," Esser said. "Because our name is Rallius, we want to rally the community together around a common goal and values."
Rallius is hoping community engagement will also lead to referrals of families who could benefit from the affordable housing units, Esser said. It also plans to work with first-time homeowner education programs to identify applicants.
The project originated with the Rotary Club of Milwaukee’s Invest in Milwaukee committee, which includes members that have skills and experience in architecture and construction, Esser said.
"The Rotary Club of Milwaukee is delighted to get behind the entrepreneurial efforts and spirit of Rallius as they bring new ideas to grow the affordable housing stock in Milwaukee," Rotary Club of Milwaukee executive director Mary McCormick said in a statement.
Esser joined Rallius in late 2020, inspired by events including the 2016 Sherman Park riots that left her wanting to do more to make an impact. The startup will partner with existing banks to offer checking and savings accounts that invest deposits in ESG initiatives, but it has not yet launched those products, Esser said. Interested users can sign up for a waitlist on the company's website.
“People underestimate the power that their money has to shape the world around them,” Rallius by ESG Financial founder Geeta Sankappanavar said in a statement. “Rallius provides an easy way for members to provide fuel for the positive impact they want to see in the world – and the affordable housing pilot is just the beginning.”
The Rallius pilot program will complement Milwaukee's Community Development Alliance (CDA), the announcement stated. Originally formed in 2011, the public-private alliance in 2020 committed to focusing on affordable housing to advance racial equity in Milwaukee, according to a December report from the group.
Rallius plans to use its Milwaukee pilot as a test and then replicate the model in other neighborhoods and cities.
