Surdna to use impact investing to support entrepreneurs of color

Gloria Freeman, Meda’s Entrepreneur of the Year, is the founder and chief executive officer of Minneapolis-based Olu’s Home. (Image courtesy of Meda and Olu’s Home, Inc.)

The excerpt below is from:
Building an Inclusive Economy by Supporting Entrepreneurs of Color
By Don Chen & Shuaib Siddiqui of The Surdna Foundation

As other contributors to this series have pointed out, the US economy is deeply inequitable. The median household wealth for black and Latinx families is 12 times less than white households. And as the US population grows more diverse, racial economic inequity will impact more and more Americans. By 2050, people of color will represent half of America’s total population. Simultaneously, median household wealth for black and Latinx families is expected to drop nearly to zero, which means half of the population will face significant structural barriers to economic opportunity and mobility—barriers that ultimately prevent them from fully participating in both the economy and democracy. This is profoundly unjust. Considering that consumer spending drives 70 percent of US gross domestic product, it also stands to impede the country’s ability to compete in the global market.

The Surdna Foundation, one of the oldest family foundations in the United States, is committed to addressing these inequities and building a more inclusive economy for future generations. Our mission is to foster communities guided by principles of social justice, and distinguished by healthy environments, inclusive economies, and thriving cultures. We work to fulfill this mission through a variety of approaches.

In terms of impact investing, we announced our commitment in 2017, allocating $100 million—10 percent of our total endowment—for mission-related investments (MRIs), program-related investments (PRIs), and a variety of other strategies intended to both fulfill Surdna’s social justice mission and grow the field of impact investing. Since our initial announcement, we have committed more than $50 million in impact investments, and have reported on our experiences and lessons, with the aim of helping other foundations achieve positive social, environmental, and financial returns.

In 2018, we reasserted our commitment to social justice by refining our focus and centering on racial justice—a shift based on our belief that the most effective way to build a more just society is to address historical and structural racial inequities.

Focusing on Racial Justice

As part of this shift, we are targeting three outcomes through all of the foundation’s efforts, including impact investing, grantmaking, and other initiatives:

  • Building wealth among communities of color,

  • Building accountability by supporting the capacity of community-based organizations to hold policymakers and institutions accountable to the goal of equitable investments and benefits in communities of color,

  • Increasing democratic participation by strengthening the power and expertise of often overlooked communities of color to shape decisions that impact their lives.

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