July 1, 2023
It’s become the buzz word heard everywhere — ‘equity.’ Now, how do you access or apply it to the world of philanthropy, which is designed to ‘promote the welfare of others’ through a generous financial donation for a good cause.
It’s the reason foundations and nonprofits exist but the dialogue of Diversity, Equity and Inclusion has put a focus on how those generous funds are dispersed, to what communities, and is it an equitable approach to the people being served and those that need it the most.
The philanthropy research group, Candid, launched a research group of funders and grantees which aims to standardize the collection of data to help others strategically donate to minority- led organizations.
“Harnessing such data could help advance racial equity,” said Candid’s CEO, Ann Mei Chang, according to philanthropy.com
“Everybody talks about philanthropy,” Chang said. “But if you don’t have any idea where you stand, you can’t track your progress.”
During a recent Michigan Chronicle Pancakes & Politics forum, an intentional focus on equity for philanthropy is starting to be realized.
“My biggest takeaway from today’s forum is that we are in a room full of people who are willing and ready to change the game on how we invest capital into businesses,” said Regina Ann Campbell, president and CEO of Build Institute.
Most of the conversation centered on how can people who aren’t usually apart of the high-tech growth opportunity, such as Blacks, Hispanics and women, be brought to the table.
“So, I think we got a listening ear of awareness. I felt I learned a lot, heard a lot of affirming things in regards to underrepresented groups.
“I think what surprised me was seeing the data. Day to day I work and see what’s impacted, and 70 percent of the marketplace is not represented in certain places. But when they talked about it on a national level about Black and Brown businesses not being represented in the one percent or less than one percent of those millions and billions of dollars was an aha moment and a painful moment to hear it in that way.”
Many corporations and foundations announced billions of dollars in their aim to promote racial equity following the killing of George Floyd in 2020. But how much of those dollars went to Black-led organizations?
A survey by the Nonprofit Finance Fund discovered white-led nonprofits were more likely to receive corporate donations than minority-led groups.
“We need for the community to come together and support early stage start-up companies,” said Dawn Batts, director of growth capital, Tech Town Detroit. “We’re very well-positioned to do so. It’s just raising the awareness and then marshalling the troops.”
“A number of the programs mentioned I actually manage. I was happy to hear that these conversations were being elevated and hope that people reach out so that we can actually continue the conversation.”
“The whole idea of innovation, the whole idea of failing, particularly in the Black community, I don’t think we’ve had permission to fail, and we have not taken risks for many reasons.
Historically we have not had an opportunity to take risk, we feel like we have to be even better. So, I think understanding that we can take risk and embracing taking risk. It can be a game changer. And then you couple that with the resources and how to navigate — then I think we start seeing some change.”
A company in the business of funding underrepresented businesses understands the importance of bringing equity to the table in term of minority businesses history left out of the loop on capital resources.
“This is the world in which I live and that’s trying to help start-ups in Michigan get the capital they need to grow,” said Chris Rizik CEO, Renaissance Venture Capital.
“One of the exclamation points that came out of this is how underrepresented founders are really underrepresented in venture. We’re doing an event in two weeks where we are connecting 275-300 venture capitalists to meet only diverse start-ups here. So, we have 140 start-ups who are going to participate in one-on-one meetings.
“By venture funds not investing in underrepresented founders, they’re actually hurting their returns, and that’s a message I think everybody needs to hear.”
Whether it’s philanthropy or capital funding for Black-led groups or companies, there is a recognition of the disparities that need to find closure on equity, which hasn’t always existed for those who need it the most.