Help Reduce the Racial Wealth Gap by Investing in Families, Homes, and Small Businesses

Throughout the U.S. the racial wealth gap is staggering. The average wealth of a Black household (2019) stood at 20 cents for every dollar held by White families. For Native American families, it was 15 cents (2020). Huge racial disparities exist in terms of income, home ownership, student loan debt and business ownership.

Philanthropy and nonprofits can take a role in narrowing the gap.

The Minnesota Council on Foundations and members created the Minnesota Impact Investing Initiative (MI3) in 2017 to support affordable housing and small business projects throughout the state of Minnesota. This collaborative was the first in the country – focusing on a fixed income bond fund (part of RBC Global Access Management’s Community Access Capital). Today, MI3 has surpassed $110 million invested in our local communities.

The MI3 fund allows investors -- including foundations, nonprofits and government agencies -- to start with an investment of just $100,000 (typical minimums for this kind of investing are $1 million). Fund allocation can be targeted to specific counties across the state and to specific types of investments including loans for small businesses, for low income housing projects or for single family mortgages.

Because MI3 was created by MCF, we are here to help you understand the fund and the role that impact investing can play to achieve your mission. To get started, reach out to Susan Hammel, MCF’s Executive in Residence for Impact Investing at shammel@mcf.org.

For more background, read a summary of MI3.