Background

The conditions for equitable communities – opportunities to thrive, create wealth, and live healthy and fulfilling lives – are distributed unevenly in the United States. In particular, measurable elements such as access to housing, fair and secure jobs, clean environments, community-oriented businesses, and political empowerment are extracted from marginalized communities, particularly communities of color. The flow of capital and wealth creation in and out of communities is one of the key systemic forces that aggravates the disparity in access to these conditions.

Speculative real estate investing that uproots long-standing residents, the availability of healthy food options only in affluent neighborhoods, the privatization of public infrastructure, municipal revenue strategies that put the burden on communities of color through the justice system are but some examples of how capital flows extract from and systemically exclude communities from access to equitable outcomes.

At the same time as communities are working to fend off the most nefarious consequences of capital, there are inspiring examples of grassroots-led approaches to capital that empower communities and provide democratic control over capital and assets: ecosystems of cooperative development, community-governed capital funds, shared ownership models over land, and more.

The emerging models have captured the interest of many, both on the community side and with financial support organizations, such as community and national-scale foundations, local anchor institutions, and financial intermediaries, such as CDFIs and credit unions. There is now a need to understand what works, and what is missing, to scale and replicate grassroots initiatives in different contexts.

As more funders and financial intermediaries acknowledge the importance of fostering and centering community-led processes, we need to understand the role that philanthropic and impact capital can play in support of these efforts.

The Project

This project aims to contribute to these inquiries by performing a field scan of the types of grassroots, community-led projects that lead to more racially and economically equitable outcomes, and the role of capital in supporting those projects. To do so, we seek to answer the following questions:

  • What does it look like for capital to be part of the agenda for equity at the local and regional level?

  • What are the main initiatives – and types of initiatives – that take a grassroots approach to redirecting capital flows?

  • What are their pain points and recipes for success?

  • How has philanthropy succeeded in supporting these efforts, and what strategies can philanthropy and financial intermediaries take to provide further support?

We aim to generate materials that help each player in the broader ecosystem accelerate the requisite knowledge and support for the work of grassroots economic organizing. Ultimately, the project’s outputs will support the broader ecosystem of democratized power and wealth such that communities of color and other marginalized communities have a say in the financial activities that affect them.

Current Stage of the Project

We are conducting a taxonomy of grassroots-led initiatives and want to gather the experiences of practitioners engaging in such projects. If you are involved with or know of models that place communities at the center of asset ownership (e.g. cooperatives, community land trusts), capital vehicles (e.g. community loan funds, committee that works with local banks), or other forms of economic development (e.g. technical assistance providers, community-oriented accelerators), we want to hear from you!

This collaborative project is an opportunity to share experiences, co-develop strategies that can onboard aligned philanthropic and investment capital into initiatives like your own, and help develop the national ecosystem of grassroots-led projects. We are ultimately seeking to lift up the work of those leveraging community assets for a more racially and economically just world, and make sure that it is properly scaled and replicated.

We are also looking for research support for this project. Please reach out if you are interested in supporting this work.


Do you work to democratize capital, ownership of land and business, and decision-making around finance in your community? Are you a provider of capital looking to support grassroots projects that lead to equitable outcomes? Reach out at info@transformfinance.org to learn more about this project and get involved.