Three Roots Capital Upgrades Internal Infrastructure, Partners with Two Local Small Businesses

July 16, 2024

Small business graphic about downhome loan manager, Nerds2go, and omega digital

Much like Three Roots Capital (3Roots) invests in projects and companies throughout East Tennessee and greater Appalachia, 3Roots also invests in its own internal systems, tools, and processes.

“We are preparing for growth, planning for the long haul and being intentional in our pursuit of excellence because the communities we serve deserve it,” said Kim Krebs, Loan and Investment Administrator. “Our clients deserve to work with a community development financial institution (CDFI) that’s sophisticated but also still shakes hands and looks people in the eye. We want to help these businesses succeed.”

Prior to 2023, 3Roots explored and utilized several tools for portfolio administration and management. Beginning in earnest in January 2023, 3Roots began working closely with DownHome Solutions to fully implement DownHome Loan Manager (DLM), a cloud-based loan management software used extensively in the CDFI industry. DLM enables 3Roots to manage its entire portfolio in one place, consolidating databases and integrating with the accounting system, thereby increasing efficiency and positioning 3Roots for future growth.

“This move is extremely forward-thinking for a CDFI of our size,” said Kim. “We’ve been around since 2016. But as we discuss these updates with our bank partners and borrowers, we’re instilling confidence that we plan to be here for the long haul.”

The initial implementation process spanned from February until October 2023. It required fully capturing and cataloging the important business data and then organizing and harmonizing the data into the framework of the new software. This allowed the creation of a single, robust database that houses critical information for the staff at 3Roots to have at their fingertips to improve accuracy, productivity, and efficiency.

“Launching DLM was a huge undertaking,” said Kim. “However, I don’t think I could have learned this business as intricately as I have learned it without going through it. That process was priceless—baptism by fire.”

Kim spearheads implementation of additional operational solutions to set 3Roots up for long-term success, including partnering with Omega Digital Solutions.

In late 2023, 3Roots began working with Marcus Blair, founder of Omega Digital Solutions and graduate of 100Knoxville, to build an advanced reporting tool and business management dashboard. This new feature will allow the team to have daily updated information at their fingertips, enabling them to make better decisions with a growing portfolio. The tool should launch later this summer. “Marcus is wonderful to work with,” said Kim.

“DownHome Solutions and Omega Digital will never replace our hands-on approach, but the tools they provide will allow us to become more streamlined,” said Kim. “Instead of paperwork demanding so much of our resources, we can spend more time creating solutions, being hands-on and face to face with our clients.”

In early 2023, 3Roots President and CEO Grady Vanderhoofven introduced the company to Don Dally and his Farragut-based IT services company, NerdsToGo Computer Service. Grady had been friends with Don and acquainted with Don’s business for years. Grady asked Dennis Corley – because of his background in IT services – to help assess NerdsToGo as a potential local complement or supplement to 3Roots’ Nashville-based IT service provider. After an assessment period, 3Roots began working with NerdsToGo Computer Service to improve the company’s IT infrastructure to support new digital tools and a growing number of team members.

“They’ve been fabulous,” said Kim. “Instead of calling a helpline to be put in a queue for them to call you in several days, NerdsToGo will help us immediately and have even come to our office personally to offer support. That’s invaluable.”

“Three Roots Capital is an ideal client for NerdsToGo as we expand our presence in the small business enterprise sector. Our expertise and capabilities align well with their needs, allowing us to add significant value to their operations,” said Don. “Serving Three Roots Capital is particularly fulfilling, as we can support their mission to make a positive impact in our local community and the broader region.”

Looking ahead, 3Roots is in the discovery phase for a new software platform to support the deal intake process with potential new clients, and they are exploring options to increase tracking and reporting efficiency for grant administration and impact tracking.

“Contracting with NerdsToGo and Omega Digital allows 3Roots to directly support our local small business community as a customer,” said Grady Vanderhoofven, President and CEO. “This scenario is a win-win for us. We make loans and investments in our community, we provide coaching and mentoring, we help companies and projects establish beneficial connections, and when we can, we support our local small business community as a customer. 3Roots is a strong proponent of the concept of buying local when possible.”

“3Roots has dramatically increased our capacity to pursue and deploy high-impact capital for organizations and projects,” said Grady. “We have many financing tools in our financial toolbox, but there are other ways we can support local businesses, and we strive to do so. Our ability to positively impact our local and regional economy increases as we scale our back-office operations. I’m thankful for Kim’s drive and vision for 3Roots. She has allowed us to increase our efficiency and productivity, which empowers us to magnify our impact.”

Three Roots Staff Spotlight: Kim Krebs

July 16, 2024

Three Roots Capital (3Roots) welcomed Kim Krebs as its Loan and Investment Administrator in January 2023. Kim’s extensive experience in sales, HR, portfolio analysis, cost reconciliation, contracts management, and software implementation made her the perfect fit to join the 3Roots team in the new position.

“3Roots is growing and we needed to bring on someone with Kim’s expertise to drive the automation and streamlining of our portfolio administration infrastructure to prepare for future growth,” said Grady Vanderhoofven, President and Chief Executive Officer. “Kim came on and got right to work. She accomplished more in her first 90-180 days than we had accomplished in the previous four years in terms of implementing a new software platform. Kim’s passion, tenacity, and attention to detail have been a wonderful addition to our team.”

Kim grew up on a working farm in rural southern Ohio, where she was primarily raised by her grandparents. As a child, she worked with her grandfather in the tobacco fields, which instilled an early appreciation of hard work.

“I adored spending time in the fields,” said Kim. “I love a challenge, accomplishing something new and blazing a new trail.”

At 17, she left home to attend Ohio State University for two years before leaving school to work full-time. For a few years, she worked for a successful Ohio entrepreneur who worked with Dollar General outside of Goodlettsville, Tennessee, on a new product called voicemail. Later, she worked in the healthcare industry and wore many HR-oriented hats.

When her three children were little, she stepped back from her career to stay at home with them for 12 years. She finds this time of her life an essential part of her story because she wants to empower others to take breaks—or not—in their careers.

“I will never regret it, not for a minute. I think it’s important because it is a part of my resume and certainly a part of who I am today. I consider it a huge blessing to have been able to do that.”

In 2011, she returned to the workforce at The Pilot Company, where she worked for 11 years. She concluded her time as the Manager of Commercial Contracts, where her team oversaw the company’s fuel cost with their vendors, watching the bottom line.

“It’s been a long road to get where I am today, but I’ve worked with amazing people and had great mentors who have helped me along the way,” said Kim. “I love to think I’m just one of the millions who have torn the paper ceiling and did what they knew they could do by seizing opportunities and doing good ethical work.”

Kim and Dennis Corley, Director of Small Business Lending and Investing at 3Roots, attended the same church and have known each other for 15 years. When Dennis casually mentioned something about 3Roots’ need to implement a new software system, she said her “spidey senses” started tingling at the thought of a new challenge.

“I’d gone through two huge software implementations at The Pilot Company. They were a huge undertaking and were quite a challenge, but we also had a huge sense of satisfaction in the end,” said Kim. “But you can get to a point at a company where you feel you have done what you needed to accomplish. And as an Appalachian girl, I do like a new challenge.”

At 3Roots, Kim is responsible for loan and investment administration and tracking, including implementing and maintaining DownHome Loan Manager. This software platform provides comprehensive loan and fund management from inquiry through repayment.

“Grady is taking the steps to grow this company. And I respect that. I like working with Grady very much because there’s a like-mindedness,” said Kim. “One of the best compliments he ever paid me is when he said, ‘Kim, you’re not afraid to jump in the deep end and figure things out.’ Working with Grady is easy because I think we are cut from similar fabrics.”

Three Roots Capital Makes Two New Markets Tax Credit Investments in Rural Manufacturers

March 26, 2024

Pictured (from left to right): Jeremiah Miller (Upper Cumberland Workforce Connections), Representative Kelly Keisling (District 38, Tennessee House of Representatives), Becky Hull (Upper Cumberland Workforce Connections), Will Hatfield (Truist Bank), Robert Fitzgerald (CEO, Fitzgerald Trailers), Chris Miller (3Roots), Brandon Wright (Sales Manager, Fitzgerald Trailers), and Len Braner (Chief Operating Officer, Fitzgerald Trailers).

In 2023, Three Roots Capital (3Roots) received a $45 million allocation of tax credits from the Community Development Financial Institutions Fund’s (CDFI Fund) New Markets Tax Credit (NMTC) Program. With this allocation, 3Roots made two $22.5 million investments in rural manufacturers: Fitzgerald Trailers and Quality Metal Stamping (QMS).

3Roots’ NMTC strategy is to provide flexible, Qualified Low-Income Community Investment (QLICI) loans to manufacturing and office projects that create quality, accessible jobs throughout highly distressed communities in Appalachia and the Delta region. NMTC financing is one tool in 3Roots’ toolbelt for addressing the region’s lack of access to capital and the need for more quality, accessible jobs.

“The NMTC Program is incredibly competitive. Last year, only 102 NMTC applicants nationwide were awarded tax credit allocations. 3Roots is proud to be one of those 102 recipients,” said Chris Miller, Chief Financial Officer at 3Roots. “This investment allows us to better serve rural and low-income communities in our service region. By bolstering available job opportunities, we can help local economies create more high-quality jobs and attract additional capital to communities that need it the most.”

QMS is a fourth-generation family-owned and operated metal components manufacturing company. The company fabricates high-quality metal components and has two production facilities in Henderson and Humboldt, Tennessee.

3Roots’ NMTC support allows QMS to pursue a 20,000-square-foot expansion of its Henderson production space, purchase new manufacturing machinery and equipment, and increase its steel inventory. This project will enable QMS to create an additional 25 full-time positions, help it remain globally competitive, better service existing clients and more easily attract new clients.

“Quality Metal Stamping is thrilled to partner with 3Roots on our first NMTC transaction. They have been easy to work with and certainly understand the strategic alignment between capital providers, companies and the community,” said Colin Serling, Vice President of Strategy at QMS. “With newer equipment, the need to educate our current and future workforce has never been more important. We will continue to invest in education today for our future growth in the years ahead. Manufacturing is in our blood, and there has never been a more important time for this sector to flourish domestically.”

Backed by Fitzgerald USA, Fitzgerald Trailers is a new business that manufactures trailers for the commercial large truck transportation industry. Fitzgerald Trailers will equip two separate facilities to fabricate and assemble up to 2,000 commercial truck trailers annually in Byrdstown, Tennessee, and Tompkinsville, Kentucky.

NMTCs will allow Fitzgerald Trailers to fund its initial startup-up phase and accelerate its business plan by supporting faster access to equipment, purchasing inventory, and working capital deployment. Fitzgerald Trailers will be able to accelerate hiring beyond what it could self-finance, creating 282 jobs.

“The guidance provided by 3Roots made the process quick and efficient, allowing us to stay focused on bringing the product to the market while securing this vital financial support,” said Len Braner, Chief Operations Officer of Fitzgerald Trailers. “Thanks to the funding provided by the NMTC program via 3Roots, Fitzgerald Trailers can accelerate our time-to-market and capital investment for this product portfolio. Additionally, it will allow us to create quality manufacturing jobs in Byrdstown and Tompkinsville.”

“Truist has positively impacted businesses, created jobs and served communities through the New Markets Tax Credit Program since the program was founded,” said Chris Leutzinger, Senior Vice President and New Markets Tax Credit Relationship Manager at Truist Community Capital. “Our collaboration with 3Roots to support Fitzgerald Trailers will invest needed capital into Byrdstown and Tompkinsville, and is another example of how Truist inspires and builds better lives and communities across the regions we serve.”

3Roots is proud to leverage $45 million in NMTCs to help two rural manufacturers in Tennessee and Kentucky. These investments demonstrate 3Roots’ growth and ongoing commitment to pursuing high-impact projects in the Delta Region and Appalachia.

Contact the 3Roots team today to learn how NMTCs could benefit your project.

Three Roots Spotlight: Donna Gambrell

March 25, 2024

Three Roots Capital (3Roots) is honored to have Donna Gambrell, President and CEO of Appalachian Community Capital (ACC), as a member of its Advisory Board. With four decades of government and public service, Gambrell’s expertise is an asset to 3Roots and its clients.

“If you had asked me when I graduated from college if I would be going into the community and economic development field, I would have said absolutely not,” said Gambrell. “Life never happens in a straight line. Careers don’t happen in a straight line, either.”

After she completed her bachelor’s degree in communications and journalism, Gambrell’s father encouraged her to get a federal government job to pay off student loans. Eventually, she began working for the Federal Deposit Insurance Corporation (FDIC), leading to a 16-year career culminating with her role as the Deputy Director of Compliance and Consumer Protection.

“In consumer protection, I worked with folks who may not have known they were signing their lives away or being scammed. They often just needed more financial education. I found the consumer protection work fascinating,” said Gambrell. “When you’re poor or low income, you don’t always get the kind of services and products that others who are in a stronger financial position receive.”

After Hurricane Katrina struck the Gulf Coast Region in 2005, Gambrell and other FDIC officials visited the hardest-hit areas. There, she was struck by the devastation facing low-income communities and people of color. She saw how community development financial institutions (CDFIs) were on the ground, directly helping those most impacted by the storm and economic fallout.

In 2007, she became Director of the CDFI Fund at the U.S. Department of Treasury. She was the agency’s longest-serving director and the first African American woman appointed to the role. During her tenure, the CDFI Fund experienced significant growth.

“It was the best decision I ever made,” said Gambrell. “I got to see CDFIs in all their glory across the country. It was inspiring to see their work and know that they were using funding from the CDFI Fund to build capacity and create real impact in the communities they served.”

In 2013, Gambrell left government service and went into private consulting. After a few years, she began working with Appalachian Community Capital and became the organization’s second CEO in 2017.

“There is a strong entrepreneurial spirit in the Appalachian region,” said Gambrell. “There’s also great beauty, tremendous resilience and a strong community spirit. Those things attracted me and have kept me engaged in the region, wanting to know more.”

Several years ago, Gambrell met Grady Vanderhoofven, 3Roots’ President and CEO, through Ray Moncrief, a 3Roots Board Member and former Chairman of the Board of Directors for ACC, among other roles. She joined 3Roots’ Advisory Board a couple of years ago.

“In her advisory position, Donna offers unique, strategic insight gleaned from decades of experience in banking, community and economic development, consumer protection, grants management and community relations,” said Vanderhoofven. “It has been an honor to work with her at 3Roots and to witness her work with vital investment initiatives like Opportunity Appalachia, an ACC project.”

Gambrell has enjoyed supporting 3Roots and watching the firm grow during her tenure. She loves seeing its impact on the communities it serves.

“Anyone who has the time to devote to being on an advisory board should do so,” said Gambrell. “You get to see and hear about fantastic projects underway, like 3Roots’ latest New Markets Tax Credits deals. Their coverage, products and services — it’s tremendous.”

Gambrell refers to NMTCs as the “jewel in the crown” for CDFIs because of their impact.

Gambrell noted that “NMTCs are public-private partnerships that invest in some of the country’s most devastated areas — in many cases, the most poverty-stricken and the ones that need the most infrastructure investment. In addition, the projects often create quality jobs. I love seeing the impact. That’s the best part about what I do.”

Three Roots Capital 2023 Year-In-Review

January 18, 2024

Happy New Year! Looking back on 2023, we want to carry forward the theme from our Stakeholder Appreciation Reception and say again “thank you” to every individual and every organization that chose to work with Three Roots Capital.

We genuinely appreciate our borrowers, portfolio companies, bank partners, institutional partners, and state and federal partners. Our success is evident through our productive collaborations with our stakeholders.

Some significant 2023 accomplishments include:

Closing more than $50,000,000 of transactions, including more than $37,000,000 of new loan originations
Closing new equity and equity-like investments in six young Tennessee companies
Supporting companies and projects in seven counties throughout Tennessee
Raising more than $51,500,000 from new and current bank partners
Raising $2,000,000 from the LendTN Program to be used as matching funds and becoming Tennessee’s first investor/lender to deploy capital under the State’s FundTN Program
Receiving a $45,000,000 allocation of New Markets Tax Credits (first-time recipient)

3Roots deployed capital as equity, subordinated and convertible debt, and senior loans, including deals requiring collaboration with local economic development agencies in Oak Ridge and Morgan County to facilitate tax increment financing for high-impact economic development projects. The commitment of $25,500,000 to finance multiple projects at the University of Tennessee Research Park was one of the year’s highlights. 3Roots supported small businesses, startup companies, for-profit and non-profit entities, and construction and permanent financing for affordable multi-family housing, industrial/manufacturing, and office projects.

We added new team members in 2023 to bolster and enhance our capacity and capability, including impact tracking, measurement and reporting. We also upgraded our information technology infrastructure, implementing a more capable and sophisticated software platform to support loan and investment administration and reporting.

2023 was 3Roots’ most successful year in terms of the number of deals closed, capital committed and deployed, and capital raised. In December, we raised $38,700,000. Coupled with the $45,000,000 of New Markets Tax Credits we received in the fall, we can provide substantial financing to job-creating small businesses and impactful projects in 2024.

Looking back on a fruitful 2023, we look forward to an impactful 2024. Most importantly, we look forward to collaborating with existing and new partners to help them accomplish their goals for 2024.

Financial institutions: Partnerships on the road to economic prosperity

January 18, 2024

By Dr. Marianne Wanamaker, Dean, Baker School of Public Policy and Public Affairs, and Board Member, Three Roots Capital

I’ve enjoyed sitting on the Board of Directors for Three Roots Capital since early 2020.

The economic landscape has changed quite significantly during this time, and I’ve enjoyed watching 3Roots navigate these challenges and find their foothold in the new economic order.

I’d like to take a moment and define, in economic terms, what 3Roots is trying to accomplish and also what our local economy needs all financial institutions to provide.

I originally shared these comments at the 2023 Stakeholder Appreciation Reception. If you missed (or forgot) them, continue reading.

Where does prosperity come from?

Economists tend to view prosperity, or “economic growth”, as the main goal of an economy. We want our Knoxville regional economy to be bigger each year, reflecting a growing set of economic activities, rising incomes for Knoxville area residents, and rising public revenues with which to provide public services.

It turns out that economic growth stems from only two sources: we either need more working people, or we need increasingly more productive working people.

More people seems hard in Knoxville right now. Our housing costs are high and getting higher, and many of us are tired of being stuck in traffic. We need more school buildings to accommodate more students. UT needs more beds for freshmen.

But there isn’t a successful regional prosperity story that doesn’t include both of these elements: more people, and also more productive people.

National challenges: Population growth and productivity

Thinking about these two elements of growth from a national perspective, I’ll break the bad news to you first: Our country’s population isn’t growing. At all.

Right now, we’re hovering between 0.3 and 0.5% annual population growth. I always tell my undergraduate students that these figures round to zero – that’s bad. In the past 50 years, we’ve typically seen about 1% population growth. Right now, we’re registering only a fraction of that, mostly because our population is aging, and birth rates continue to decline.

But on the other hand, maybe our people getting more productive? We’re not doing so hot there, either.

Between 1960 and 1980, workers got, on average, 1.5% more productive each year. That means that each worker produced 1.5% more output, on average, in every successive year between 1960 and 1980 than the year before. But in the time since then, productivity growth has slowed considerably. Right now, we’re hovering around 0.75%.

We might break out of this, and the adoption of artificial intelligence may help. But overall, these are substantial headwinds that will make it challenging to grow regional economies across America.

In other words, if we do nothing and follow national trends, it will be hard for Knoxville to be increasingly prosperous because the average city won’t be.

What about Knoxville? Opportunities and challenges

The Knoxville metropolitan area is doing better than the national average on the population dimension, with 1.5 to 2% population growth each year. Even if none of these people became any more productive, we could continue to grow our economy. That’s excellent news.

But it would be better if we could also make Knoxville area workers more productive. And in that case, the big three – the University of Tennessee, the Tennessee Valley Authority and Oak Ridge National Laboratory – and the local entrepreneurial ecosystem have to play an outsized role.

Productivity growth comes from innovation, and we have all the right ingredients to lead in this area. I’m proud of the alignment between the big three and others locally who are promoting entrepreneurship and innovation.

So what are our potential roadblocks?

Knoxville might have solid population growth and opportunities to become more productive, but ultimately, people must be able to live here. To reach our prosperity goals, we will need to continue to be welcoming to new residents. After all, entrepreneurs are scarce resources. They’ll go elsewhere or choose other career paths if we can’t support them.

An important part of that is our housing market, which has become a real challenge.

According to the Knoxville Metro Area Housing Affordability Index, the median listing price is higher than the national average – and is still increasing. We can’t recruit or keep people here if they can’t afford to live.

What can our financial institutions do to enable prosperity?

Is Knoxville regional economic prosperity a lost cause? Attention, financial institutions. We need your help.

Financial organizations can facilitate population growth by supporting the availability of more affordable housing and by financing industrial and commercial spaces to facilitate the work of those new people.

To fuel rising productivity, financial institutions can provide capital for businesses of all types, allowing people and companies to reach their full output potential and bring others along.

3Roots does all of these things, and they do it at a scale that makes a difference.

3Roots has invested $25.5 million in real estate development at the University of Tennessee Research Park, where productivity growth is the name of the game, and is a significant investor in affordable housing projects across the region.

3Roots finances small businesses like The Houndry in Oak Ridge and provides technical support and capital to businesses like The Complete K9.

The evidence of 3Roots meeting the region’s needs is everywhere. They are fueling the prosperity of the Knoxville area economy, in concert with their financial institution partners. If you would like to become a partner or learn more about 3Roots’ work, reach out.

Three Roots leverages LendTN, bank partners and technical assistance to support two woman-owned small businesses

September 06, 2023

The Complete K9 and The Houndry are woman-owned brick-and-mortar businesses focused on serving man’s best friend. Three Roots Capital (3Roots) is proud to provide them with financing and technical assistance to promote their long-term success.

“3Roots supports small and growing businesses,” said President, CEO and Founder Grady Vanderhoofven. “The beauty of running an outside-the-box financing institution is that we work on major deals, like the recent projects at the University of Tennessee Research Park, and smaller, grassroots operations like The Complete K9 and The Houndry.”

Fallon Houser has always had a soft spot for animals. After running a dog rescue and working for a dog training franchise, she decided to forge her own path and form The Complete K9, a dog training provider focused on nutrition, training, wellness and athletics. It currently has six locations across the greater southeast.

“It’s extremely tough to open a business. Most people who haven’t done it have no idea the long hours, stress, and sleepless nights that go into building something that can help support you and your family,” said Fallon.

Fallon needed financing and business help. She connected with Director of Small Business Lending and Investing Dennis Corley through 3Roots’ relationship with Walt Bowman, a small business specialist at the Tennessee Small Business Development Center (TSBDC) office in Cleveland, Tennessee.

“3Roots stepped in and gave us a traditional commercial real estate loan with a fantastic rate, a business loan to help us consolidate some liabilities, and additional capital for the slower winter season,” said Fallon. “They also helped – and are still helping – us learn more about our industry trends and how to forecast our finances month by month.”

Fallon Houser of The Complete K9

To support Fallon, 3Roots leveraged the LendTN program, recently established by the Tennessee Department of Economic and Community Development as part of the Fund Tennessee program. The LendTN program utilizes funds made available to Tennessee as part of the State Small Business Credit Initiative (SSBCI), and the purpose of the program is to supplement private capital available to make loans to underserved small businesses in Tennessee. Grady and Dennis believe 3Roots is likely the first lender or investor in Tennessee to deploy capital under the Fund Tennessee program and the LendTN program.

“We’ve received a ton of support, allowing us to ride out slumps and stay on track to grow and offer better services,” said Fallon. “Dennis and Walt have been wonderful to work with and have helped us bring our business to the next level.”

Amanda Lovegrove has a background in managing dog daycares and boarding facilities, while Leah Hunter is a self-described “picky dog mom.” Together, they wanted to open a local daycare center that was transparent and trustworthy.

“We’ve always wanted to provide a space where dogs could be safe, have fun and socialize,” said Amanda.

In 2016, Amanda and Leah opened The Houndry in Oak Ridge, Tennessee. During 2020, they expanded their daycare into a dog adventure company that offers daily nature walks for dogs in the surrounding region. In May 2023, they opened The Backyard, a dog park and beer garden.

“We’ve found a core group of supporters, clients and friends. That makes a huge difference,” said Leah. “Many of our clients have been with us since the beginning. They’re like family to us now.”

3Roots connected with Amanda and Leah through 3Roots Board Chairman David Bradshaw, Oak Ridge Area Manager for Pinnacle Financial Partners. Pinnacle provided a construction loan to build The Backyard, but the business needed access to operating capital to pull the project over the finish line. The project was the right fit for 3Roots’ rural microloan program and additional business coaching.

“The 3Roots team is very welcoming and made the process easy. We are so thankful for their financial guidance and highly recommend them,” said Leah.

While providing access to capital is critical for small businesses, 3Roots is also committed to coaching and connecting entrepreneurs to needed resources and relationships that help them grow and thrive.

“I enjoy working with bright, engaging entrepreneurs with a vision for what they want to accomplish and the drive to see it through – because entrepreneurship is difficult, no matter the industry,” said Dennis. “Working with Amanda, Leah and Fallon has been a pleasure.”

Three Roots Staff Spotlight: Dennis Corley

September 06, 2023

Dennis Corley has been a valuable member of Three Roots Capital (3Roots) since 2017 and was recently named Director of Small Business Lending and Investing. With a diverse background as a technology executive, advisor and business owner, Dennis offers lending and business technical experience for 3Roots’ clients, especially startups and small businesses.

“I’m not big on taglines, but if I were, mine would be ‘Always be kind and helpful when you can,'” said Dennis. “I like helping people in general and have some business acumen that is helpful to the small businesses I work with.”

Born into a military family, Dennis moved around as a kid, eventually settling in Louisiana. He received his bachelor’s degree in computer science with a minor in physics from Louisiana State University, Shreveport.

“I had no idea what I wanted to do when I graduated high school,” laughed Dennis. “But computers were a big thing in the 1980s, and I’m pretty analytical, so I thought it would be a good field.”

After graduating, Dennis worked for IBM on federal, classified projects in the Washington D.C. area for several years. Following a company restructuring, he joined SAIC as a senior systems engineer, eventually bringing him to the organization’s East Tennessee office.

“I didn’t know much about Oak Ridge. I went to work for them to help them win a specific contract at the CIA – which we did,” said Dennis. “I told them I wanted to get back to the South because I didn’t like the winter weather in Maryland. And after a couple of years, they were true to their word.”

Through SAIC, in 1996, he began working as a loaned executive for Technology 2020 (Tech 2020), the first entrepreneurial support organization for startups in the region. At Tech 2020, Dennis met recently retired Melissa (Missy) Muendel, Shawn Carson, a current lecturer at the Haslam College of Business at the University of Tennessee (UT) and a former 3Roots team member, and Tom Rogers, President & CEO of UT Research Park and a valued 3Roots partner.

“We were doing some cutting-edge stuff for the time,” said Dennis.

Eventually, Dennis became a Tech 2020 employee, and he met future 3Roots Board Member Ray Moncrief and Grady Vanderhoofven, who would become 3Roots’ founder, president, and CEO. Vanderhoofven was working in the same building after he left Oak Ridge National Laboratory to run several venture capital funds with Moncrief.

“I always told myself that I would like to work with those guys someday because what they were doing was so interesting,” said Dennis.

In the early 2000s, Dennis left Tech 2020 to run Digital Crossing Networks, a young Tech 2020 creation and the first provider of data center co-location services in the region. During his tenure, the company was acquired twice – first in 2011 and more recently in 2016.

Shortly after this time, Shawn told Dennis about an opportunity to join the newly launched 3Roots. In 2014, Grady led an effort to help Tech 2020 obtain certification as a community development financial institution (CDFI), which happened in January 2015. In 2016, as Tech 2020 wound down, Grady leveraged Tech 2020’s CDFI status to launch 3Roots. For Dennis, it felt like a natural fit and coming “full circle” from his career at Tech 2020.

“I’m technically the longest-standing employee at 3Roots,” joked Dennis.

In his role, Dennis primarily works on small-business lending and business coaching projects, such as operating 3Roots’ rural microloan program and managing a federal grant with UT Research Park. Dennis also serves as 3Roots’ liaison for the Innov865 Alliance and manages inbound lending and investing requests from small businesses.

“Dennis is not only tremendously sharp and diligent, but he is a genuinely good person,” said Vanderhoofven. “He can operate both ‘in the weeds’ and on a higher, strategic level. From growing and exiting a company to working with startups in our portfolio, Dennis understands what it takes to operate a business, making him an ideal person at 3Roots to support up-and-coming entrepreneurs in our community.”

Three Roots Staff Spotlight: Dr. Melissa (Missy) Muendel

May 23, 2023

Photo of Grady and Missy at Missy's retirement paty

Dr. Melissa (Missy) Muendel has been a trailblazer her entire life.

She is an anthropologist, archaeologist and historian who recently retired from Three Roots Capital as its Director of Research and Reporting. With over 36 years of experience in research and development in the social sciences and humanities, she has made a lasting impact on her community and loved ones.

“I want people to think I did a good job, was a good coworker, was a faithful employee and knew how to have fun,” said Missy.

Growing up in New Jersey, she always wanted to become an archeologist or an anthropologist. After receiving her Master of Arts degree in Near Eastern Archaeology, she spent several years on archaeological research projects. Since the late 1970s, she has participated in 16 research and archaeological projects in the eastern United States, the Middle East and Germany.

“My parents had an extensive library when I was growing up, so I used to read all kinds of historical books about mummies, the Pharaohs and Egypt. I was fascinated by archeology and anthropology from an early age,” said Missy. “I still love being overseas – digging and participating in excavations. I love learning about how people used to live.”

In the late 1980s, she moved to Tennessee to pursue her doctorate in anthropology at the University of Tennessee, Knoxville, where she studied under Dr. William Bass, widely viewed as the foremost expert in forensic anthropology.

Before she began her studies, she took a research position at the Greater Knoxville Chamber of Commerce, where she launched and managed a research department for 11 years – while simultaneously completing her Ph.D.

In 1999, Tom Rogers, current president and CEO of UT Research Park, asked her to join Technology 2020, where he was CEO at the time. Missy became involved in all of Technology 2020’s initiatives related to access to capital. She remained there until she helped obtain CDFI certification for what would eventually become Three Roots Capital in 2016.

“Helping people is the best way to happiness and prosperity,” reflected Muendel. “I hope my work helped improve the lives of others.”

Over the last two decades, Missy wrote more than 84 grant and certification applications. Her work and insight supported the formation of Meritus Ventures, Southern Appalachian Fund, TennesSeed Fund, Southeast Community Capital (now Pathway Lending), and Three Roots Capital, as well as the receipt of New Markets Tax Credits, multiple CDFI certifications, and millions of grant dollars.

“It would not be an overstatement to say Missy has participated in projects and programs that have created and are continuing to create half a billion dollars of economic impact in Tennessee and the Appalachian region,” said Grady Vanderhoofven, president, founder and CEO of Three Roots.

In retirement, Missy is looking forward to traveling, continuing to teach at the National Forensic Academy and participating in archeological digs around the world. She already has several trips lined up over the next few months.

Freshly enjoying retirement life, she doesn’t miss working quite yet, but she does miss being alongside her coworkers – most of whom she has known and been close to for many years, including Grady. Missy and Grady first became friends over drinks at a conference at the Omni Grove Park Inn in the early 2000s.

“He was always someone I could be completely honest with,” said Missy. “I’m very proud of Grady and the rest of the team. They’ve done remarkable things the past seven years.”

When they met, Grady immediately knew Missy was uncommon and special. The office will not be the same without her, and she is welcome to stop by for a visit any time.

“The words I would use to describe Missy are teammate, loyal, tenacious, impactful and fun,” said Grady. “No matter the situation, I’ve always been able to rely on her to say, ‘We can do this.’ I wish her all the best in her next adventure.”

Three Roots Provides $25.5M for Real Estate Development Projects at the University of Tennessee Research Park

May 23, 2023

Close up of UT Research Park development

Collaboration between developers, banks, research institutions and innovative financing companies like Three Roots Capital on forward-thinking projects is critical for creating more economic development opportunities and access to capital in the greater East Tennessee region.

Over the past few years, Three Roots Capital has worked with the University of Tennessee Research Park (UTRP) on numerous real estate projects and efforts to support the region’s entrepreneurs. Three Roots has provided more than $25.5 million in financing for real estate development projects at UTRP, including the construction of the Innovation South building and the renovation of the Innovation North building.

“Three Roots has collaborated with UTRP since our founding in 2016. In 2020, we formalized the relationship by partnering to apply for a $645,600 grant from the U.S. Economic Development Administration to fund our joint effort to encourage and support development at the site,” said Grady Vanderhoofven, president, founder and CEO. “Through our work at UTRP, we want to attract additional private developers and capital to the location to continue making Knoxville a great place to start and grow a business.”

Successful projects at UTRP require participation by experienced real estate developers like Partners Development and community-focused banks like SouthEast Bank and CBBC Bank, as well as the full backing of UT Knoxville.

“The science and collaboration happening at Cherokee Farm is shaping the future of Tennessee’s economy,” said UTK Chancellor Donde Plowman. “We are at a time of incredible momentum and productivity at the UT Research Park, and none of it would be possible without partners like Three Roots, who share our mission to make life and lives better for all Tennesseans.”

Due to the complex nature of real estate projects at UTRP, Randy Jenkins, Chief Financial Officer and Financial Strategist at Partners Development, invited Three Roots to collaborate in creatively structuring the projects’ unique financing.

“Developing projects at UTRP benefits the university, collaborations between public and private institutions and the entire community,” said Jenkins. “We love having a partner like Three Roots to dive into complicated projects for creative financing strategies. They are always willing to jump into a conversation to build project financing solutions which support the vibrancy of our community.”

Innovation South, a project developed and owned by Partners Development, will enable UT and industry partners to educate a next-generation workforce, conduct cutting-edge use-inspired research, and scale up technology development for many critical sectors including automotive, biotechnology, forestry and manufacturing.

On the Innovation South project, Three Roots collaborated with multiple banks, including SouthEast Bank. As a local bank, SouthEast is committed to working with Three Roots and other regional partners to positively impact the community. Three Roots has worked closely with Jimmy Dalton, Chief Credit Officer at SouthEast Bank, on multiple projects over the course of the last seven years.

“We’re proud to work on a project that helps the university and UTRP offer tremendous opportunities for researchers, professors, students and private partners to do work that drives impact in their industries,” said Dalton. “Between rising interest rates and other challenges, without Three Roots, this project wouldn’t have been economically feasible. Grady is somewhat of an innovator in this space. We’re proud to work with Three Roots on this project.”

Three Roots recently teamed with CBBC Bank to finance the buildout of space in the Innovation North building to house the new Nursing Scholars Program at UT, established through a partnership between University Health Systems and the UT College of Nursing. The space will accommodate specialized training for hundreds of nursing students beginning in the Fall of 2023. Because of the critical need for registered nurses in the community, the project had an ambitious and aggressive schedule, so it was essential to have the support of financial partners that could be creative and move quickly.

“We’ve teamed with Three Roots Capital to finance multiple projects at UTRP,” said CBBC Executive Vice President and Chief Lending Officer John Harris. “We share their commitment to supporting projects that benefit our community, and we value our relationship with them.”

In addition to real estate projects, Three Roots has financed four innovation-based companies affiliated with the university and UTRP, including a $150,000 participation in a $1 million seed funding round for Shift Thermal (formally Active Energy Systems) and a $300,000 loan to Eonix in the fourth quarter of 2022.

For Tom Rogers, president and CEO of the Research Park and a valued Three Roots partner, Three Roots has been critical in helping further the mission of UTRP, which is to serve as a gateway for collaboration between the University and public and private partners.

“Three Roots has provided value in two primary ways: Helping finance building projects and providing important seed capital for some of our most promising Spark Innovation Center clients,” said Rogers. “We’ve established some significant momentum, and Three Roots has been a great strategic partner in making this happen.”

Three Roots raised $33.7 million from six bank partners in 2022

February 22, 2023

In 2022, Three Roots Capital raised $33.7 million from six bank partners, making it one of the organization’s most successful fundraising years to date. With these funds, Three Roots is better positioned to support companies and projects in low-and-moderate income and rural communities throughout the greater East Tennessee region.

“Sometimes you get so busy working that you forget to look up and reflect on the progress you have made. 2022 was a really big year for us,” said Grady Vanderhoofven, president, founder and CEO. “This additional $33.7 million is especially significant in light of broad economic uncertainty and the rising interest rates we all experienced last year.”

Three Roots forged new relationships with Regions, Truist Bank, Coffee County Bank, and First Bank & Trust and raised additional funds from existing bank partners, Pinnacle Bank and CBBC Bank. One of the first new community partnerships formalized in 2022 was with Regions.

“Regions is proud to work with Three Roots Capital in strategically deploying resources to communities that need them the most,” said Rob Stivers, market executive, Regions. “This directly complements our long-term focus on creating more inclusive prosperity in East Tennessee. Grady and the rest of the staff have done a fantastic job educating banks and the broader financial community about the importance of having a viable CDFI in today’s market.”

For Truist, partnering with CDFIs helps their community development managers and regional leadership meet the unique needs of the communities in which they operate. More than just connecting capital with people and projects, Three Roots also offers essential business coaching and wraparound services that help businesses grow and thrive.

“Truist’s partnership with Three Roots Capital is an example of our purpose to inspire and build better lives and communities,” said Lauren Butler, Community Development Financing Initiative Relationship Manager at Truist. “Our investment with Three Roots provides much needed resources to support the needs of businesses and projects in the greater East Tennessee region. It’s a great partnership focused on growth in the community.”

Looking ahead, Three Roots will focus the additional funds on projects and companies in low-and-moderate income areas. With the funds from Truist, Three Roots seeks to emphasize the deployment of capital to minority-owned and controlled businesses and affordable/workforce housing projects. With the funds from CBBC, Three Roots will support specific projects and opportunities at the University of Tennessee Research Park.

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Watch: Stakeholder Appreciation Reception Video

By Dr. Marianne Wanamaker, Dean, Baker School of Public Policy and Public Affairs, and Board Member, Three Roots Capital

Where does prosperity come from?

National challenges: Population growth and productivity

What about Knoxville? Opportunities and challenges

What can our financial institutions do to enable prosperity?

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