Fear and uncertainty and anxiety is giving way to determination, affirmation and new possibilities.
A year ago, investors and founders were on the defensive in the face of legal and political attacks on ESG and DEI. At this year’s SOCAP gathering in San Francisco last week, Agents of Impact were singing a new tune: Investing for inclusion, equity and diversity is essential for long-term performance.
“This is about fiduciary duty,” said CapEQ’s Tynesia Boyea-Robinson, who co-founded Freedom Economy with Adasina’s Rachel Robasciotti to defend the rights of justice and sustainability investors. “We’re not pushing back. We’re not just fighting back. We are standing 10 toes down on what makes good financial sense.”
Settling accounts
Robasciotti and Boyea-Robinson have more freedom to act because of the strategic settlement of several key lawsuits. Atlanta-based Fearless Fund in September settled a lawsuit brought by the conservative-led American Alliance for Equal Rights that alleged racial discrimination in a small grant program for Black women founders.
At the private lunch on the sidelines of SOCAP, Founders First CDC’s Shaylon Scott shared for the first time publicly that the nonprofit arm of Founders First Capital Partners had also strategically settled a lawsuit brought by the conservative group.
“Our mission has always been to support and serve small businesses across the country, no matter where you’re from, no matter what your background,” said Scott. “Our focus is women-owned businesses, veteran businesses, LGBTQ businesses, those located in moderate-to-low income areas, everyone. And yet, we were still targeted.”
The settlements, which included concessions, protect the broader community, explained Boyea-Robinson. The terms mean the entities can’t be sued again, and protect against a broader court battle that could lead to a change in law. “When they position these things as losses, it’s a narrative loss, it’s not a legal change,” she said.
Getting beyond the lawsuits, opens a lane for affirmative litigation, says Boyea-Robinson.
“The only reason organizations are being targeted at times like now is because we’re being successful,” continued Boyea-Robinson. “It’s now time for us to play offense. Together.”
Reconstruction redux
Progress on climate and inclusive prosperity sparked the attacks in the first place. Moving forward confidently despite the headwinds became a theme of the conference, especially ahead of a consequential US election.
“If we take three steps forward and we take a step or two back, we can’t think that we’re back where we started,” Activest’s Micah Gilmer said following the screening of “Ownership and Equity,” ImpactAlpha’s documentary on Napoleon Wallace and his network of organizations in North Carolina that together form a multi-front strategy for Black wealth-building and multi-racial prosperity (watch the trailer and read the backgrounder, “From North Carolina, a playbook for the Reconstruction of Black wealth,”).
“We are actually at a moment where we have an opportunity to continue moving forward,” Gilmer said.
Intention to action
Moving forward requires overcoming inertia. “When you leave this conference, do one thing next week. Do something uncomfortable,” said Antony Bugg-Levine, who has stood up an impact investing advisory practice. “It is the comfort of people in positions of power that is stopping us closing the gap between this intention and action.”
Greg Neichin of Ceniarth took up Bugg-Levine’s call to action in calling on other wealthy families and institutions to take on more risk and even lower returns to drive more impact.
“Impact-first. Catalytic. The terms actually don’t matter. What matters are dollars getting into communities in need,” said Neichin, explaining Ceniarth’s decision to join other family offices and foundations in putting fresh funding behind the Catalytic Capital Consortium (for context, see, “C3 doubles down to scale up deployments of catalytic capital”). “Call it whatever you want, as long as you bring dollars into hard-to-reach places.”
New paradigm
Across SOCAP, Agents of Impact were working to bridge gaps and make unlikely connections.
For example, JW Carpenter is helping lead Prosper’s mission to make Birmingham, Ala., a destination for ideas, talent and funding. “We don’t think all the smart people live in seven cities in the United States,” Carpenter told ImpactAlpha. In Birmingham, “Outside talent, outside ideas, outside funding can couple with the talent we’ve got and the investment we’ve got locally to make cool things happen in industries across the board.”
In Mexico, SVX Mexico’s Laura Ortiz is leading a paradigm shift. “We need to move from a paradigm that separates the feminine from the masculine, that separates the North from the Global South, that separates the financial world from the real asset world,” said Ortiz, a general partner at Regenera Ventures. “We need to go into a unity paradigm.”
