Giving Compass' Take:
- Y. Elaine Rasmussen explains how impact investing can be made more inclusive and has the potential to empower entrepreneurs of color.
- How will impact investing help drive progress in local community development initiatives? What are successful examples of impact investing spurring inclusiveness and diversity?
- Read about this impact investing approach to support economic inclusion.
What is Giving Compass?
We connect donors to learning resources and ways to support community-led solutions. Learn more about us.
There is an ever-apparent disconnect between real systems change and this thing we call “Impact Investing” — one I continue to see over and over again. Today we have a great deal of what I affectionately call hyperbolic do-gooding — yes, I made that word up — when we really need to use money in socially conscious ways that drive deep social change.
if the goal is to disrupt the social change systems — such as the providing alternative routes to capital for entrepreneurs to attain sustainable success — then impact investing must not be set up to resemble the very same exclusionary systems its working to dismantle. I would argue that in its current form, its success as an innovative tool is limited by the access it does and does not provide.
Here are a few practices that limit access: Investment portfolio/policy limitations such as $100,000 investment minimums, lack of cultural competence to know what enterprises best serve community (social good) and have returns on investment; (i.e. beauty shops in black communities, Halal grocery stores in Muslim communities) just to name a few.
Inspired by the words of Gandhi, “be the change you want to see, I created ConnectUP! MN. It's a day and a half convening that bridges the 180 degrees of separation between investors interested in local investing and entrepreneurs of color.
ConnectUP! MN will highlight entrepreneurs of color and innovation in Minnesota and across the nation with the a focus on four goals:
1. We are the sum average of our network and if our networks look like us, they will continue to look like us. Entrepreneurs and investors need to expand their networks be connected in meaningful engagement and relationship building.
2. Raise the transparency of the variety of financial instruments and capital raising options for entrepreneurs of color — who are typically only offered debt options.
3. Bring together the entrepreneur ecosystem (other sources of capital like CDFIs, academia, incubators, accelerators, etc.) to co-design a new vision for a more equitable access and options.
4. To create a dynamic butterfly effect. If we all flapped our individual wings what wave could we make together. Participants will asked to make a commitment to an action that moves toward the new vision.
Read the full article about impact investing and inclusivity by Y. Elaine Rasmussen at BALLE Views.