Succession Goes Local
V.2, N.20
No, I'm not referring to the megalomaniacal Logan Roy in the popular HBO series, but to 2.9 million U.S. small businesses whose owners will soon retire. According to Project Equity, an imminent Silver Tsunami will endanger 32 million jobs and more than a quarter of our gross domestic product (GDP). But creative initiatives are emerging to help these businesses survive under new local ownership. Project Equity itself is developing succession plans around worker ownership. Another approach, which is our top article in this issue, is New Majority Capital’s efforts to help BIPOC entrepreneurs build wealth through the acquisition of legacy companies.
The Providence (RI)-based company is structured around a foundation and a fund. The foundation runs one set of classes for retiring entrepreneurs looking for new owners, and another set for aspiring entrepreneurs interested in buying into one of these businesses. Graduates are then eligible to access capital from the company’s $50 million fund. Unlike venture capital schemes, the fund makes finance arrangements that, according to cofounder Kris Schumacher, are “designed to be as non-extractive as possible.” They will also help the new owners organize investment crowdfunding campaigns to supplement and speed up the transition to local ownership.
Our second article is on the Black Wealth Builders Fund, which has been put together by a mostly white church in Berkeley, California. The fund provides zero-interest loans to help African-Americans come up with a downpayment to purchase a home in the Bay Area, where the real estate market remains eye-poppingly expensive. The absence of interest means that the loans are technically not securities, so the fund avoids many of the legal complications that impede other community funds.
We also have two articles on how the recent banking crisis, which already has brought down the Silicon Valley Bank and Signature Bank, is afflicting banking in communities of color. Immigrant entrepreneurs unlucky enough to have deposits in SVB have been scrambling to make payrolls. And this turmoil is a reminder of the need for new local banks owned by African-American investors. At one time there were 134 black-owned banks, there are now 21.
Finally, we have a story of how MIT’s CoLab Fellows are improving the lives of healthcare workers by creating new cooperatives.
NEWS
Is Entrepreneurship Through Acquisition The Answer To Building Wealth For People Of Color?, Forbes (February 22)
These Zero-Interest Loans Help Black Americans Buy Houses, Next City (March 22)
Silicon Valley Bank’s Collapse Should Concer Founders of Color, AP News (March 27)
Black-Owned Banks: How Fintech Presents Untapped Community Reinvestment Potential, NewsOne (April 1)
MIT CoLab Fellows Build Community Wealth for Long-Term Care Workers, Kresge Foundation (March 29)
PARTNER VOICES
Participatory Investment in Banking: Opportunities and Options for Banks, Transform Finance (March 28)
Inaugural Employee Ownership Equity Summit Builds Momentum, Project Equity (March 2023)
Chicago Enlists Project Equity in Community Wealth Building Initiative, Project Equity (March 2023)
Financial Institution Aims to Help BIPOC Business Owners, Albuquerque Journal via Prospera Partners, (February 2)
EVENTS
Connecting Capital To Neighborhoods That Don’t Normally Get It – In-Person Conference (Jackson, Mississippi). April 24-26, 2023. Jackson, with its 80% Black population, in the poorest state in the nation, provides a clear example of the racial wealth gap. The tools that Neighborhood Economics is identifying can be deployed in Mississippi to repair the damage caused by the connection between race and poverty. This event will bring together investors, philanthropists, entrepreneurs, problem-solvers, and people of faith in a city that needs them all.
NC3: National Coalition for Community Capitol: SuperCrowd23 - Virtual Conference. May 10-11, 2023. Two days of learning about impact crowdfunding that will provide entrepreneurs with invaluable information for fundraising but will also facilitate networking. Use code NC3friend to register for half off. Register here.
Total Impact Summit 2023: Investing for People, Planet, and Place – In-Person Conference (Philadelphia, Pennsylvania). May 1-2, 2023. A two-day, dynamic event for individual investors, family offices, foundations, fund managers, and financial advisors to connect with aligned peers and partners, learn about proven and new investment tools, meet leaders of investable opportunities, and move toward action and investment. See FAQ here.
11th International Public Markets Conference – In-Person Conference (Toronto, Canada). June 8-10, 2023. For over 35 years, the International Public Markets Conference has brought together visionary market managers, community advocates, and civic leaders to explore the changing forces that are shaping public markets today. Register here.
Rural Innovation Webinar Series - Virtual Conference. March 31, April 12, April 26, May 10, and May 12 2023. This free six-part webinar series will talk about how discovering how automated intelligence can save you oodles of time to learning the basics and debunking myths of crowdfunding, this 6-part Rural Innovation Webinar Series has it all. Sign up today to learn something new that can help your business. Register for one, or all of the conferences by clicking the video here.
ICYMI
Opinion: Government Banks Never Went Away. Just Don’t Call Them Bailouts, The Globe and Mail (April 1)
Could We End Wealth?, Yes Magazine (February 27)
New Businesses Ready to Contribute to Local Economy, The News-Herald (March 4)
Community Wealth Building: A Pathway to Advancing Economic and Racial Justice, Ontario Nonprofit Network (March 30)
JOBS BOARD
Vermont Community Loan Fund is hiring a Director of Housing and Community Facilities Programs
Vermont Community Loan Fund is hiring a Career Technical Education Loan Program Project Manager
Mission Driven Finance is hiring for multiple positions
Project Equity is hiring a for Business Engagement and Partnerships - Outbound Manager
Project Equity is hiring a Regional Engagement Program Manager - California
Project Equity is hiring a Financial Analyst
FREE SHORT VIDEOS ON LOCAL INVESTMENT
If you want to short answers to your most pressing questions about local investment, we have prepared a series of 5-10 minute videos. You can find them posted on our website under the “Local Investing Videos” page. Or click on the links below to be directed to videos based on the topic:
BECOME A MAIN STREET CHAMPION
Have you always wanted to start a local investment club? A website of local investment offerings in your community? A local investment study group? Whatever your interest or ambition, we invite you to “go public” to help others in your region find you, scheme with you, and start a local investment movement in your community. Our goal is to identify dozens, then hundreds, then thousands of Main Street Champions like you across America. We already have Main Street Champions across the U.S., from San Luis Obispo, CA to Providence, RI, and even Australia! Together, we can move our hard-earned savings from Wall Street back into our communities. Fill out the intake survey below to join this growing cohort!
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About The Main Street Journal
The Main Street Journal aims to catalyze the movement of $50 trillion from Wall Street to Main Street to facilitate economic development and economic justice. It’s sponsored by the National Coalition for Community Capital, with a grant from the Heron Foundation. We welcome feedback about everything, from our design to content. And we welcome suggestions of other groups to involve as partners, and other information to include. Please send ideas to Melea Huon-Dumentat at melea@main-street-journal.com.
PARTNERS
We welcome any nonprofit or for-profit committed to local investment as a partner. If your organization is interested, please contact Melea Huon-Dumentat at melea@main-street-journal.com.