 Yeah, good afternoon Okay, yeah Thank y'all for being patient good Well, hi Good afternoon. Y'all are really very impressive. Good. Look at folks. Thank you for being here My name is Jessica Norwood. I am the founder of the runway project The runway project solves this friends and family gap for African-American entrepreneurs, and I'd like to describe it You know when you've got a really great idea for your business and everybody's like, yeah, lovely idea Call your friends and family But then when we climb into this racial wealth gap that we're here to talk about We realize the disparity between that and so something that seems really benign very possible for everybody Isn't actually really possible. In fact, the wealth gap for African-American entrepreneurs So somewhere around $11,000 Comparison to whites is a hundred and forty two thousand dollars So that means that if you're starting this idea You may not have your friends or family to go to to help you capitalize your business in the earliest stages And so you would come to me and I will be your friend and family and I'm here joined by my lovely partner in everything Condom Mason who helps us with strategic partnerships When we started this panel, I Had this idea and I maybe I was drawn to the point around Being at a place in my life where I'm really valuing the wisdom keepers folks who have been Doing the work will put a lot of rigor a lot of skill into the into what they've been doing and for me Nobody better Exemplifies that then Deborah freeze and mark Watson who are sitting to the end They run the Boston impact initiative and what I hope to do today was to talk a little talk to them a little bit about Really what the vision is around the Boston impact initiative, but more of the heart of why they do this Why would they have a fund that is explicitly dealing with closing and addressing the racial wealth gap? And so this is an opportunity for us to maybe turn the tables a little bit to our partners and talk about why they're here doing this work So I'm gonna start there if that's cool So tell a little bit more just so we get the context about Boston impact initiative Boston impact fund a little bit More about the details of that and then we want to go into the conversation great So I founded the Boston impact initiative back in 2013 and at first it was a privately held LLC Because we had a hypothesis that it is possible to take a place-based approach. So Eastern, Massachusetts Using integrated capital blended finance layering equity debt and grants in combination to close the racial wealth divide in our community And we live in the number one most unequal city by income in the country and that is absolutely built around race So that was the issue we wanted to solve to create a healthy and resilient Boston and we deployed 3 million across 30 different investments And at the end of which we say yep, you can do this But we need to do it differently. It has to be this blended capital going in That and grants and going out equity debt grants royalties warranties What happens if we put relationship long-term relationship with an enterprise at the center of our work and we bring whatever Capital we have to bear social capital financial capital every kind of financial capital in order to support that enterprise as it develops so we then Said the pilot was a success and we created a 501c3 charitable loan fund last year And we're raising 10 million dollars to deploy other people's money debt and grants into this same strategy And part of the way that we chose to do that was even to change the way that we solicit the capital So we are able to engage Non-accredited investors in our case it will mostly be Faith-based institutions in the same communities that we're deploying the capital which is unusual to get to participate in this Process as well as accredited investors and philanthropic capital We've engaged all the stakeholders from the investment side To work on this project with us on the deployment side in addition to providing blended capital in the ways that the entrepreneurs needed We also invoke what we call non financials social covenants So these are covenants that are binding equally as binding as debt repayment schedules Where the entrepreneur commits to relating to the community that they are working in in a different way So they might be locally sourcing 30% or locally hiring or providing living wages or Instituting an ESOP program. So these are in every deal that we've done. We've closed just over a million two In transactions so far, but it's again a whole new model and an approach for addressing a very tough issue That's really you know what I I love that when you all talk about the model that you have it's so Holistic, it's it's it's completely Comprehensive in a nature. It's just not kind of checking a box And so I love the thought that has gone into it and the effort and and the innovation in it And I think about all of us here at so cap, right? We come to so cap I don't know many of you have been here years before I know I have and we have the Conversation about the racial wealth gap. We have the conversation about How to change our money how to change how to how to make changes in this area and yet The gap is getting bigger and bigger nothing is Changing really very little is changing and yet we have the same conversations over and over every year and I really am wondering What is it? What is it that is missing? How are we missing the mark when this is why we're here supposedly is to change the way we do finance and yet The gap just gets wider and wider Okay, so let's really go into that and go underneath it. So my background is in systems thinking and Systems living systems self-organized And the in the case of human systems. We organize around us self And that so self-organizing we organize around a self and for human systems. That is a set of values and beliefs and So I believe that we are Shifting we're not there yet though from what I would call an economics of separation To an economics of relationship and those of us who are in the impact investing in the social entrepreneurship space We're trying to move toward this new world But we haven't actually recognized how deeply immersed we are in the values and beliefs of the economics of separation right, so how I would articulate that is These beliefs we are self-focused rugged individualists Our biological reality is survival of the fittest Right competition is our natural state Which means that some of us work harder and are smarter and therefore earn what we gain and others are lazy and less Capable and they need our help which gives rise to philanthropy Right he who wins the competition has the right to accumulate and nature is here to serve our needs and support our growth So I'm not saying we're all That's all that we are but there is a dominant narrative in our culture That is about individuals and competition and accumulation and what happens is we're out there trying to change the world and We're still operating from Individualism and competition and accumulation in our social enterprises and in our impact investing And so we get more of the same we get a little bit better Right, we are doing definitely we are doing incremental change work There's no question that we're nailing it on incremental change and maybe there's transformative change from time to time But to truly deal with transformative change the system that we're in has to organize around a different set of values and beliefs and the values and beliefs of an economics of relationship are That we are fundamentally interdependent we move from competition to cooperation That we think about resources that flow instead of accumulate So this is where recognizing that nature is our teacher the wisdom of nature and in nature When resources accumulate, it's called stagnation, right nature resources flow They're meant to move through the ecosystem to where they're needed most So now when we ask the question back to the impact investing in social entrepreneurship sector is Flow at the heart of your financial model right is Cooperation a higher value than competition in your business model If it's not you're staying in the economics of separation and we're getting more of the same it's like I what I'm hearing you say too is that If we were to actually align our values and our activity In alignment with how nature works that there would be different outcomes Because we I mean one of the things we know is that we are living on something like seven earths And we only have really one and so we know we have overshot We're overshooting and and and I want to bring this back to social justice because there is not a A ecological Issue that does not have a corresponding social justice issue. Is that right? Would you agree with that? So so here we are back on how do we match our Investment and and the way that we see money and the way that we deal with money In alignment with actual transformation in with a social justice lens Conduct I might add a lot of our products all of us are involved in these are Market rate return we use this term market rate. Yeah, and I just wanted to tie it back to Deborah's comment Where there's an assumption that market rate actually on our part is is exploitive It's an extractive threshold if you're extracting who are the casualties? So our fun is actually trying to redeploy Some of those excess returns back into the communities that where they were extracted in the first place So I mean this is a connected logic, and I just wanted to highlight that And let me add in going back to this notion of biomimicry or learning from nature right if we want to think about returns And you know we get these debates about market rate or concessionary. What's the basis of that debate? It's looking backward at returns So what is a fundamental shift in the way we think about risk and return? So one way to think about return that I'm doing we're doing in our place is So a mature hardwood forest in New England grows at a rate of four percent a year There's something from nature a bamboo forest grows at a rate of 35 percent a year and colonizes Everything it's in its path wiping out other subspecies That should sound a little bit familiar in the way that we treat people in our communities So how do we think about returns and how do we think about justice and how do we think about inclusion? We have to start thinking like healthy ecosystems and not like extractive industrialists And it feels like we're also talking about yeah, right You're fundamentally talking about a shift a mind shift I mean our entire the way that we are world view it's a heart mind shift that that we're talking about because Right now these values that we are that we are living by and and doing business by and investing by are not connected with this heart mind that we're talking about because deep caring deep empathy deep compassion deep love for each other and Actually shifting and allowing can you imagine if we allowed those values to lead? The way we invest Maybe that's what the problem is. I mean when I see it. I really know that we are talking about there really has to be a fundamental shift in the way that we see things and Otherwise this band-aids were great at band-aids We're great at walking by a homeless person and putting you know and feeling like you put a dollar in the can And you think well, you know you've done something when fundamentally There should be no homeless person on the street, right? There's systems changes that need to take place and how do we? With the capital and resources that we have actually make systems changes And that is what I see bi what you all are doing and what we're doing with the runway project I mean we have a systems problem when we talk about the statistics that they just said earlier about the wealth gap another statistic is that it would take 228 years For a black family's wealth to reach a white family's wealth if the white family stayed static it would take 228 years that is crazy and That is the system that we with the runway project are working with in terms of Filling in that gap for the friends and family money that just doesn't exist What we can learn from nature or what we can learn about how our natural sort of Ecology would really move But I think that they're the question that I have inside of this is all right So we have some examples of some places that we can look to learn Why aren't we doing that like really what's happening and and is there a tension around Race inside of that like I just have to name it really explicitly like we're keep saying quote racial wealth gap But we don't act and we put a lot of the finance stuff ahead of This conversation that we just don't have that has to do with race So I'm wondering where the two things marry around what we can learn from from the in from the environment What can we can learn from nature what we can learn from how things move and how we do the heavy work Around talking about something like race inside of that So I think we have got to look at The position we have to talk about power We cannot talk about the wealth divide without talking about power and the question of how attached Folks are particularly white folks right to holding on to power and When we start to move toward you know racial justice has gone into the main stage, right? I mean we're here. We are talking about this But it tends to mean Diversity and inclusion initiatives, which is a fraction. It's a necessary but way insufficient Shift for us to actually take any ground in a meaningful way on the issue of racism and racial justice And so we have to start talking about power Meaning who's making decisions about the allocation of capital Right and that's part of you know For example, our fund is majority governed by community-based Organization so that we are not the ones sitting in an ivory tower making all the decisions we partner with another fund That's participatory democracy and decision-making So I think one of the issues is we can start talking about racial justice work in closing the racial wealth divide And if all we're doing is writing checks differently, we're not going to take ground We have to talk about seeding power and transitioning power same thing from where it's accumulated To where it's been extracted from and white folks need to do that work And this might be controversial but my belief is that the US is moving toward financial apartheid Where where you have a browning of the population and the resources are puddling in a very small part of the community And one of the ways to deal with that is to change who the decision-makers who allocate capital So my challenge and and I've been the investment business for 30 plus years At all levels of the business is for everybody in this room to consider within your own organizations Who's making the decisions about allocating capital what screens or what what biases are built in and we all have them But part of that I mean we have to start there to turn to turn around this apartheid scenario the strong part about Really pushing against these places where power is being is actually disrupting this flow of capital from us living into Show up as a community of folks here at conversation Pardon me. You can't hear me. So, sorry. I'm back Microphone is falling here. Sorry, but I'm thinking about where we as a community here who gather at SoCAP Start to engage this question this week. We're opening this up Engages question this week around power dynamics and engages question about how we're We're looking at building our work Inside of this more natural kind of flow that happens what kind of Work would you have us do as a community here? We're all assembled here. We all Imagining wanting to really challenge. We're here to show up to do this good work What are we saying? And I'm gonna throw you into this as well. What are we saying to this group of folks about? What it means to be doing work to close the racial wealth gap something very practical that that we want to people to start leaning into Yeah One of the first things that comes up for me is that we have to do some internal work Because externally we again the Band-Aid situation, which we do often and we do really well But if we don't do an internal Investigation within ourselves and really change some fundamental and look at the own our own participation in in in racism in America and white supremacy in America if we don't start looking at that and really You know being able to to be honest Then because what happens is that? There's so much benefit by not looking at it seemingly benefit although I don't believe that anybody's winning I really believe that it's a lose-lose situation that we're in those there are those that seemingly are winning But nobody's really winning when the air you can't breathe the air when you know All the all the things that we share and until we can fundamentally understand that we are deeply interconnected Not only to each other, but to the planet as well that we are nature That we fundamentally are nature walking and breathing until we understand that deep interconnection Then the exploitative Mindset of me me me mine mine my I I Will continue to to lead in everything that we do and we see the results of what we get from that and so I really think that a deep understanding of our deep interconnection and Is fundamentally important as as as step one Really seeing that differently because we have we have separated ourselves when you talk about Separation we've separated ourselves from our own cells from our own soul We separate ourselves from each other certainly from the planet You know if we could trash it the way that we do and so I just really think that that's a really fundamental change That needs to happen So if we had more time We would probably ask you to sit and notice what is The narrative in your head that says this is why I can't make the shift Right, so so people in our space impact investors like well There aren't any black and brown owned businesses to invest in or Foundations who are trying to find fund managers who are inclusive. Oh well There aren't any black and brown fund managers with track records out there Check the narrative because it's actually false So you may not be in relationship with the folks that you need to be in relationship with But there are abundant people talent skills Enterprises creativity all of that is out there We're not looking in the places that we need to look which means check the narrative Find out what the objection is and then go back to the belief system underneath and Talk to someone about it at least be witnessed in the practice of finding out what narrative did I inherit it from inherit from this? Culture that I could choose to walk out of and step into relationship with others To really begin to explore we have no shortage of pipeline We have great businesses to invest in So it's possible Look at who you're not investing in Look at who's not showing up in your pipeline look at What investors are not investing in your fund and and understand the reasons why? And that's sort of the canary in the coal mine to sort of trigger where we're in your organization There are blocks against groups or sectors or gender or whatever, but that's what we actually have done this process ourselves internally I mean we're racial justice fund and we had an introspective look So I would encourage people to run that process themselves And it's not okay to Stay with the status quo We have to get to the point to where not only are we concerned about it, but oh well and keep going We have to say it is fundamentally not okay I cannot continue the way with this portfolio looks like I cannot Continue because I am supporting something that I know is detrimental to the planet to each other And that is not going to fundamentally get us where we need to go and so we have to really make it so that it's just not okay We can't just glaze it over and wish it were different It takes effort. It takes relationship building. It takes comfort coming out of your comfort zone Going into a place of discomfort Which is where the learning happens, which is where the juicy part of life is is in that little discomfort zone It takes being able to do that and being willing to do that and being committed to a different world Because as long as we're committed we will have that lens on everything we do and if we're not committed It will be a check the box and we'll go about our business and say it's okay, and it's really it's not okay well, I want to thank you all of you for being my guest on my panel and I also want to let all of you know runway is always looking for folks who'd like to support and work with us We are currently raising monies now, and so please find us talk to us right right and And if you'd also like to talk to us about how we're doing what we're doing and the possibility of doing that in your area We love those conversations as well. So thank you so much. Enjoy your so cap. Thank you. Thank you so much