As researchers and conveners, we know that addressing the root causes for our country’s racial disparities requires expertise and radical collaboration. On our quest to understand what it takes to achieve more equitable outcomes for all people in a country undergoing rapid demographic shift, Living Cities is not only doubling-down on the use of capital as a driving mechanism of change, but also exploring new approaches to close the racial wealth gap.
Living Cities has embarked on an exploration into the role that investors, both philanthropic and private, can play in advancing approaches that narrow the racial wealth gap. To that end, and in light of the themes that emerged during our first Builders and Benefactors convening, we commissioned the creation of The Radical Collaboration for Black Wealth Creation Report which embodies our efforts to go beyond addressing racial income disparities in order to focus on ways that could support people of color in generating wealth that can be transferred multi-generationally and contribute to undoing 400 years of harm.
The Report is a field guide for philanthropic institutions looking to use their investments to shift how capital is deployed within the market, for fund managers focused on race and impact, for Black founders seeking additional insight, and for anyone willing to reimagine. For Living Cities, the Report not only informs and reaffirms our applied research on business starts and growths, but also pushes us with greater urgency to challenge harmful and commonly-held-as-true notions of who gets to make capital decisions and which individuals are considered investable.
We recognize that in order to effectively address racial wealth gaps by influencing how capital and ecosystem supports are deployed, there is more unlearning necessary within our organization, the field, and beyond. As we continue to lay the groundwork for a new way of using our capital and influence to advance our focus on race and results, and ultimately change behaviors in the market, the Radical Collaboration for Black Wealth Creation Report is intended to encourage the field to step back and reflect on structural disparities that have been 400 years in the making:
How can philanthropy leverage its risk models to influence a system that allows the fact that for every $100 of white wealth, Black families have only $5.04?
What systems and practices have contributed to the fact that more than 25% of Black families have zero or negative net worth, while only 10% of white families fall into this category?
What would it take for Living Cities to use its investments and influence to shift how capital is deployed so that the average Black family with a graduate degree does not accumulate $200,000 less in wealth than its white counterpart?
As our research on what it takes to address the capital needs for founders and fund managers of color develops, the recommendations included in the Report, and our efforts to nurture our connection to the Builders and Benefactors group, will continue to inform our overarching efforts to help shift power in the market and to close income and wealth gaps.
To learn more about the historical and current state of black fund management, and examine the ways in which philanthropy can disrupt the systems that currently yield poorer results for people of color, download the Radical Collaboration for Black Wealth Creation resource. If you want to join the conversation do not hesitate to contact Demetric Duckett at DDuckett@livingcities.org.