Featured Paradigm Shifter

At Work…

What inspired you to start aligning your loan fund with your mission? Rende Progress Capital (RPC) is the only racial equity focused loan fund and CDFI in Michigan committed to economic equity by providing small business capital to Excluded Entrepreneurs of Color in order to eliminate the racial wealth gap. Recognizing entrepreneurship as a key tool to address this gap, we aligned our small business lending with the mission of racial equity guiding our outcomes through two key initiatives: (1) providing loans to marginalized business owners of color and ( 2) facilitating free technical assistance programming in both group and individual coaching sessions.

What have been the biggest obstacles at your foundation for mission alignment? As a racial equity loan fund CDFI founded and managed by professionals of color, there have been notable obstacles through which we have persevered. The first challenge was making the transition from a successful and impactful proof of concept to growth. The second obstacle is remaining competitive in the labor market, which is limited to begin with, and we compete with other long-tenured CDFIs and conventional financial institutions. Lastly, we need to continue the growth of being joined by foundations and corporations outside of our region and state.

How far along is your foundation in this journey? As of FY 2024, RPC is in our sixth year. Last year was our inaugural fifth year in which we received CDFI certification from the U.S. Treasury CDFI Fund.

What’s next in your mission alignment? RPC considers our “next” right now. In late FY 2021, we observed that we (1) had pilot years of impactful lending, a great track record, effective financial and management operations, portfolio performance, and lessons learned; (2) were organically expanding lending geographic markets beyond our post-launch market; and (3) that FY 2023 would be our fifth inaugural year where such five-year outcomes should necessitate a plan for growth. RPC board and staff developed a strategic plan framework, secured a strategic planning partner, and developed our strategic plan objectives for growth in assets, services, and impact for the next five to eight years.

What about perpetuity or spending down? Since our founding, RPC has committed to a focus of conducting our mission and services for perpetuity based on the fact that there will always be a case and cause for providing alternative/mission-based capital to businesses of color. Also, we unfortunately know that the permanent reduction or elimination of the racial wealth gap will not be achieved in our lifetime. There may be conditions and needs in the future for RPC to envision possible racial equity asset allocation and financing to businesses of color via another asset class or different form of a CDFI.

What’s a favorite mission aligned investment of yours? We have so many favorites, and I always appreciate this question. I recall during our first two years of how loan closings – like today – were so enjoyable as new loan customers would celebrate with selfies, some would cry amid the opportunity that they were given, etc. One investment with strong impact, growth, and loan portfolio performance is Soldadera Coffee, a Hispanic-owned family business with a unique-tasting cold brew coffee developed from a recipe from their grandmother, a Mexican social activist. They strive to bring more awareness to women’s issues in the United States, and their continued success was catalyzed by a RPC loan in 2021. They have grown their revenue and product placement and are now in 112 locations across the Midwest.

Have you ventured into shareholder advocacy? How so?! No. However, we appreciate that a few RPC investors who are institutional investors have engaged in shareholder activism.

What’s the most convincing thing to get others on board? Fortunately, the past notable barriers to convincing institutional investors have been diminished as representative by the investments of foundations such as UnTours (our first out-of-state provider of capital), corporations, banks, and federal and state governments now journeying with us. However, during our launch phase there were some barriers with potential grantors and investors. Some were simply needing to be convinced when we did not have a track record while others were not fully knowledgeable of impact investing or CDFIs. I recall by name individuals, foundations and banks that gave us a ‘no’ many times because they were contrarian to the term “racial equity.” We also faced racial bias given that RPC was founded and managed by professionals of color. I recall meetings where the majority of the time was spent explaining (or debating) racial equity or our professional merit.

Unfortunately, inequities exist between people-of-color led CDFIs relative to white-led CDFIs. A US Treasury CDFI Report from 2016 shows 22% of CDFIs were owned or controlled by people of color with total assets of about $750 million compared to $7 billion by white-led CDFIs. Such disparities have significant implications for POC-led CDFIs as their comparatively low asset size limits their ability to leverage resources and expand their impact on communities.

After Work…

Guilty pleasure: DJ’ing and mixing on the turntables. Playing Xbox.

Kickback film: I have several but can narrow it down to movies within three genres: In non-fiction/biographical: Malcolm X; In fiction: Rudy; In sci-fi: Anything Star Wars.

Last series you binge-watched: “For All Mankind” on Apple+ TV

Favorite caffeine source: Coffee

Sweet or salty: Both

Happy place: With my wife, and off-roading in my Jeep

A favorite novel: Baltimore, or The Steadfast Tin Soldier and The Vampire by Mike Mignola and Christopher Golden

Animal friends: Our dogs, Alex (English Bulldog) and Dude (English Shorthaired Pointer)

Childhood ambition: Governor of Michigan and meeting Halle Berry. No longer goals.

Biggest challenge: Several growing up, but in general the challenge has been/is on overachieving. The two other challenges most recent in past memory to now were launching Rende Progress Capital (and the current challenge is growing it) and successfully moving to my ‘red/black’ belt in martial arts.

Soundtrack of your life: Almost any song from Public Enemy

Music that lifts your spirits: Almost anything from Sounds of Blackness particularly “Optimistic” and “Soul Holidays.”

Most unusual gift received: A hand-knit scarf.

Last splurge: Star Wars mini Millenium Falcon ship for my office and several video games.

Mission Aligned Investees