The current thinking in the impact investment, philanthropy and asset allocation community is that if we make capital available to more diverse people it will drive economic justice. In the very important fight for equality and shifts in our financial systems, we are increasingly making allocation decisions based on demographic details (ie gender, sexual orientation, race etc). The reality is that if anyone gets capital before they have a sound strategy, adequate leadership capacity and infrastructure to deliver, it will harm them, not help them. It is necessary to ensure that small businesses, organizations and asset managers from marginalized communities have a plan to be sustainable and not reliant on debt, investments and grants to survive. Silver Lining has spent the last 3 years testing this premise by issuing loans to underserved small business owners based 100% on its technical assistance behavioral data. With a small business support first, capital second strategy, we have been able to dramatically outperform industry standards on the diversity rates, approval rates and repayment rates of our portfolio. In addition, we have been able to operate our capital business with a budget that is 90% less than the industry norm. In this session, we will outline our business model, portfolio metrics and the key lessons and learnings that other allocators can take away to implement in their work and create more success for them and the communities they serve.
Why Deploying More Capital To Marginalized Communities Will Fail - And How To Solve It
Track
Learning & Capital: Investing in Education
Format
Brief and Bold (1 Speaker, keynote style)
Speakers
- NameCarissa Reiniger
- TitleFounder & CEO
- OrganizationSmall Biz Silver Lining
Description
The current thinking in the impact investment, philanthropy and asset allocation community is that if we make capital available to more diverse people it will drive economic justice. In the very important fight for equality and shifts in our financial systems, we are increasingly making allocation decisions based on demographic details (ie gender, sexual orientation, race etc). The reality is that if anyone gets capital before they have a sound strategy, adequate leadership capacity and infrastructure to deliver, it will harm them, not help them. It is necessary to ensure that small businesses, organizations and asset managers from marginalized communities have a plan to be sustainable and not reliant on debt, investments and grants to survive. Silver Lining has spent the last 3 years testing this premise by issuing loans to underserved small business owners based 100% on its technical assistance behavioral data. With a small business support first, capital second strategy, we have been able to dramatically outperform industry standards on the diversity rates, approval rates and repayment rates of our portfolio. In addition, we have been able to operate our capital business with a budget that is 90% less than the industry norm. In this session, we will outline our business model, portfolio metrics and the key lessons and learnings that other allocators can take away to implement in their work and create more success for them and the communities they serve.
