What is Giving Compass?
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Giving Compass' Take:
• The Rockefeller Foundation describes its effort to tear down the racist financial structures that bar minority-owned businesses from equal opportunity.
• While funding can be instrumental for minority-owned businesses, why is it critical to focus on systemic change? How can you use your giving to dismantle these racist structures?
• Read more about the connection between philanthropy and minority-owned businesses.
Institutional racism has been rampant since…well, always. Minority entrepreneurs have never been afforded the same access to capital and credit as white entrepreneurs. As a result of this dearth of access, communities across the United States suffer.
According to the U.S. Department of Commerce, minority-owned businesses are more likely to forgo applying for loans for fear of rejection, less likely to receive them when they do apply, and more likely to pay higher interest rates on business loans compared to their non-minority counterparts.
But the track records of minority-owned businesses don’t support this reluctance to invest. In fact, according to that same Commerce Department report, minority-owned businesses drive the creation of well-paying jobs, serve as anchors in their communities, and grow faster than non-minority-owned businesses.
As Andre Perry, a fellow at Brookings, often says, “there is nothing wrong with Black people that ending racism can’t solve.” We alone are not going to end racism, but in an effort to move towards a more equitable society, we are investing in reducing barriers to accessing capital and credit for Black and Latinx-owned businesses.
As part of The Rockefeller Foundation’s $65 million commitment to America’s working families announced earlier this year, we made an initial $10 million commitment in June to help eliminate barriers to access capital and credit among small businesses operated by Black and Latinx owners in 10 cities.
The Rockefeller Foundation Opportunity Collective will support a collective of government, business, foundation, and nonprofit partners over the next several years, and the first ROC collaboration to get off the ground in two minority-majority cities is with Main Street Alliance. This effort leverages the Foundation’s close relationships with stakeholders in Newark and Norfolk along with MSA’s robust experience building local small business leadership networks.
Read the full article about minority-owned businesses by Brett Mons and Amanda Ballantyne at The Rockefeller Foundation.