Additionality

In the context of Prime’s investment decision making, when a solution’s impact potential would not be enabled, accelerated, or deepened were it not for support from charitable sources.

There are many other ways to define additionality, including the definition developed by consensus among the Project Frame community and how Prime describes it in our organizational values. Prime's definition of additionality for investments is based on the IRS requirement for U.S. foundations that a program-related investment, designated from charitable distributions, is one that conventional investors — such as those seeking market-rate returns — would not find appealing.

To make investments, Prime's nonprofit team assesses whether investments meet our criteria for additionality as well as GHG impact potential, while investment managers (who may be Prime employees or independent partners bound by contract) assess whether investments have commercial potential. All three criteria must be met in order for catalytic capital to be provided.

Read our white paper, Additionality in Theory and Practice, to learn how additionality has guided every program design and catalytic investment since our founding in 2014.