Racial Justice Collaborative supports BIPOC-led social enterprises
RSF Social Finance’s newest philanthropic fund uses integrated capital to support U.S. social enterprises promoting community wealth and ownership
RSF Social Finance has launched the Racial Justice Collaborative, a new philanthropic fund that provides diverse forms of capital to U.S.-based social enterprises with Black, Indigenous and people of color owners and leaders.
Starting with an inaugural group of four organizations dedicated to creating community wealth and ownership, the initiative backs BIPOC organizations that consider all stakeholders — the community, employees, customers and the environment — in their work.
The initial $225,000 of grant funding ($200,000 from the Racial Justice Collaborative and $25,000 from the Food and Agriculture Collaborative) supports Downtown Crenshaw, CA BIPOC Farmer & Land Steward Relief Fund Collaborative, Higher Purpose Co and East Bay Permanent Real Estate Cooperative.
Project shifts who decides as well as who receives funding
The collaborative strengthens RSF Social Finance’s broader efforts to support racial and economic justice.
“BIPOC entrepreneurs and founders face much higher hurdles than their white counterparts in accessing capital across the funding spectrum due to systemic racism that’s woven throughout the finance sector, which includes RSF,” notes Casey Johnson, manager of Food and Agriculture Lending at RSF and one of the originators of the Racial Justice Collaborative concept. “The Racial Justice Collaborative isn’t just about who we’re funding, but also about how. As a white-led organization creating this collaborative, RSF felt it was vital to shift funding decisions to racial justice–centered partners.”
A working group of RSF staff and external advisers with community wealth building and racial justice expertise makes funding decisions. Advisers include Rodney Foxworth, CEO of Common Future; Nwamaka Agbo, CEO of the Kataly Foundation and managing director of the Restorative Economies Fund; and Kate Poole and Tiffany Brown, founders of Chordata Capital.
“We are grateful for this opportunity to participate in RSF’s expanded commitment to racial and economic justice,” says Brown. “We look forward to not only helping to get these funds to aligned individuals and institutions, but also shaping the internal analysis and governance that creates lasting change for future work.”
Agbo notes, “RSF’s Racial Justice Collaborative is placing the emphasis on the ‘impact’ of impact investing. The collaborative’s success is not determined by the returns back to investors, but rather by the improved quality of life and well-being that these BIPOC organizations are creating in their communities through self-determined strategies.”
Goal is to expand access to early-stage capital
The launch of the Racial Justice Collaborative is “a key step in demonstrating our commitment to justice, equity, diversity and inclusion,” says RSF CEO Jasper van Brakel. The advisers play an essential role, he adds. “There is much for us to learn in the area of racial justice finance, and we are thankful for the deep knowledge and accountability our advisers provide.”
A $350,000 lead gift from The Schmidt Family Foundation and two other gifts catalyzed the new Racial Justice Collaborative, which continues to fundraise for future loans and grantmaking. Jamie Dean, director of impact investments at the foundation and a recent Integrated Capital Institute fellow, said the gift reflects The Schmidt Family Foundation’s commitment to improving diversity and inclusion in its work.
She adds, “We are excited for this new collaborative’s decision-making model and value the opportunity to invest in it. For far too long, BIPOC entrepreneurs have faced barriers that have hampered their business success, which in turn holds back wealth building. In particular, our foundation is excited to help create more access to early-stage capital so that BIPOC businesses can take flight.”
Downtown Crenshaw: Putting the community in control of economic development
Downtown Crenshaw is a project and a movement to preserve one of the last predominantly Black areas of Los Angeles. Headed by Black-led Downtown Crenshaw Rising, a nonprofit community corporation and activist group, the project aims to purchase and redevelop a 40-acre mall in Crenshaw into a 21st-century urban village built upon principles of community wealth building. The plan is to create an environmentally sustainable urban village with a mix of cooperative businesses, retail, restaurant, grocery, housing, office, hotel, entertainment and green spaces that results in a regenerative, restorative and reparative local economy. The Racial Justice Collaborative is supporting the project with a $75,000 grant.
CA BIPOC Farmer & Land Steward Relief Fund Collaborative: Laying the foundation for resilient local food systems
The CA BIPOC Farmer & Land Steward Relief Fund Collaborative distributed $835,000 in pandemic relief grants to 80 BIPOC farmers and land stewards in California during 2020. In its second round of grants, the group brought the community into the decision-making process by inviting farmers from the first round to support others in their community; this allowed grants to go quickly to those most in need. The CA BIPOC Farmer & Land Steward Relief Fund Collaborative includes the First Nations Development Institute’s California Tribal Fund, Minnow, Agriculture and Land-Based Training Association (ALBA), Mandela Partners, The Butterfly Movement and Kitchen Table Advisors. RSF’s grant funding of $50,000 from two of its collaboratives will help the group build on this momentum to create a foundation for resilient local economies and food systems.
Higher Purpose Co: Building a Black community wealth hub in the Mississippi Delta
Black-led Higher Purpose Co is building community wealth with Black residents in Mississippi by promoting ownership of financial, cultural and political power. RSF supported the organization with a $100,000 loan guaranty in 2020 to enable more loans to Black women entrepreneurs; the $50,000 grant from the Racial Justice Collaborative contributes to HPC’s $1 million capital campaign for phase one of its new headquarters, designed to serve as a hub for Black entrepreneurs, farmers and artists in the Delta. The building will house HPC offices, mission-aligned business tenants, a food hall, a retail store, a civil rights museum, a creative conference room and a multipurpose theater.
East Bay Permanent Real Estate Cooperative: Revitalizing a historic Black arts and business corridor along West Oakland’s Seventh Street corridor
The East Bay Permanent Real Estate Cooperative, a community real estate developer that supports BIPOC communities’ access to land and housing, is leading the reactivation of a historic Black arts and business corridor in West Oakland centered around Esther’s Orbit Room, a legendary former blues and jazz club. The Esther’s Orbit Room Cultural Revival Project, a multistage, community-designed cultural arts center with a goal of creating a space for the Black arts community for generations to come, will bring to the Seventh Street corridor a fine arts and movement arts gallery, three units of cooperative artist housing, a juice bar and café, outdoor festival space, a community stage and a weekly Black farmer’s market. The Racial Justice Collaborative’s $50,000 grant contributes to getting the project off the ground.
