New financing approaches can change the way we build broadband
To bridge the digital divide, we need to fund the broadband providers that can best connect underserved communities

Photo by Bidgee (CC-SA 3.0)
We’ve written before about why community connectivity providers (CCPs) are necessary to provide affordable internet access to the millions of people still living without reliable connection across the US. But while community-focused providers have enormous potential, they face a lack of financial capital.
At Connect Humanity, we’re using different financing approaches to support CCPs and transform how we build broadband in the US and beyond, from rethinking how we conduct due diligence to reimagining the financing structures themselves.
Communities can’t access the investment capital they need
Existing capital markets do not provide adequate financing to community connectivity providers. Traditional lenders for small and medium sized businesses, like credit unions and local banks, are rarely familiar with network-related business models and their underwriting methods overestimate the risk of lending to CCPs. This means high, unsustainable interest rates and/or exorbitant collateral requirements.
Private investors and commercial banks who DO understand the business model are used to working with large for-profit providers. They write big checks and demand high returns. A CCP looking for $3 million to serve a low-income community of 1000 people is often seen as an insufficient return on investment, unless subscription packages are unaffordably high.
Neither route offers the flexible, sustainable finance needed to power the growth of CCPs. Instead, these networks often rely on a limited pool of grants. Grant funding may be enough to build a small, low-cost network and run a pilot, but not much more (think 20-50 subscribers). But networks need to be able to graduate from grants to impact investments and commercial capital to grow and reach financial sustainability.
Community connectivity providers are sustainable
There are already examples of successful CCPs across the US and around the world who have built sustainable models to connect underserved communities. Like in Chattanooga, Tennessee where residents have Gigabit speeds at some of the lowest prices in the country because the city built a municipal broadband network (9 of the 10 fastest ISPs in the US run on municipal networks). Or B4RN, a community-owned and volunteer-powered network that offers full fiber service in rural North England for £33/month. ILSR’s tracker of community networks has mapped 900+ community broadband projects in the US alone.
These networks have built sustainable businesses without consistent access to capital markets. But to catalyze more successful projects like these, we need investors that are equipped to fund CCPs. Connect Humanity was founded to be this kind of funder.
Building financial tools to expand internet access
As head of Connect Humanity’s impact investments, I look for network operators that are or can be financially sustainable.
We then find and structure the right investment that works for them from a range of financial tools to set a project up for success. For instance, we can build blended capital stacks, combining grants, sub-commercial investments, and traditional financing that provide the right size of capital at an affordable blended rate that gives a network a path to growth and sustainability.

Our ability to deploy a range of financial tools helps us de-risk networks to make them more attractive for commercial investment. Our philanthropic toolbox includes technical assistance to improve a project’s network design; grants to purchase necessary equipment; and support for digital equity master plans. These plans give the technical design, market research, and financial analysis required to make a project viable. All these can move a project towards sustainability.
What we invest in
Different communities will require different tools to create sustainable networks. We offer:
Project financing for network builds in a single community, secured by the network’s economics. We may look at tools like revenue-based financing as well as more traditional loans.
Enterprise credit for operators that work in multiple communities. Financing can include senior term loans, working capital, and lines of credit. We like to include digital equity covenants to ensure everyone is served.
Innovative finance: Creative investment vehicles that promote things like device access, telehealth content, and other programs to encourage uptake of digital services. Because infrastructure alone is not digital equity.
When we do due diligence, we look at digital equity and financial outcomes to make sure a CCP will meet a community’s digital needs. Closing the digital divide isn’t just about running a cable to residents’ homes but also removing other barriers to using the internet. So we’re rethinking the due diligence process to really dig into the drivers that lead to adoption and meaningful use. By better understanding how a network operator is advancing digital equity, we believe that also helps strengthen the business case for investment.
Bridging the digital divide once and for all
By funding CCPs we can change the way we build broadband in America. Rather than ISP monopolies charging communities high rates for poor broadband, communities can build, run, and own this essential service — while generating a recurring cash flow that remains within and serves the local area.
Of course, like all investments, CCPs come with risks. But no more than other infrastructure investments. Our approach to due diligence allows us to better disaggregate the specific nature of the risk, whether technical, strategic, operational, or economic, so we can tailor financing with the most relevant structures and most appropriate terms to balance risk mitigation with project success.
We’re early in our journey, but we’re already seeing the huge need for more capital and more relevant financing tools to fund the growth of CCPs. We want to speak with philanthropic funders, impact investors, and anyone else that shares our commitment to accelerating digital equity and is ready to get this done.
This is the third post in a series about our work. Read the first, about why we created Connect Humanity, by Chris Worman, and the second about why community connectivity providers are necessary to bridge the digital divide, by Jochai Ben-Avie.
Keep in touch
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