The Citizen Recommends: ImpactPHL’s Total Impact

The Denizen Recommends: ImpactPHL'southward Full Impact

Among the speakers non to miss at this week'due south impact investing conference is Catherine Berman of CNote, a platform that funds women-owned startups

Apr. 29, 2019

Ever since Wall Street was founded in 1792, investing has had ominous undertones, conjuring images of greed and excess, pinstripe-clad white men at mahogany desks.

And for decades, the stereotype largely held true: Investing opportunities neither targeted, nor served, communities like women of color, young people, or those lacking major avails to play around with.

Catherine Berman is amongst the moving ridge of leaders breaking that mold.

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With a pedigree in traditional finance and a rails record of launching successful startups, she is now the CEO and co-founder of CNote , an impact investment platform that invests in women, minorities, and low-income communities across America. To date, CNote'southward investment products have a spotless record with zero losses.

Berman is one in a lineup of prominent leaders who will exist presenting at this Wednesday'south 2nd annual Total Touch on conference, for which The Citizen is a media sponsor. Here, she shares her accept on how investing can lead to meaning fiscal returns—and even more than meaningful social ones.

JP: What is CNote?

CB: We are a financial applied science [fintech] visitor on a mission to close the wealth gap through financial innovation. We believe that engineering, collaboration, and, frankly, humility can go a long way in creating a financial services industry that we're actually proud of. CNote technology helps democratize impact investments.

JP: How and so?

CB: When we think virtually democratization, we actually retrieve about things like making information technology very accessible. Accessible to u.s. ways things similar no minimums—so if you look at our flagship product, you'll see in that location's no minimum on that, yous tin [invest] with a dollar. Accessible to us also means transparency around business organisation models. We have no fees. So we're not tacking on an additional chunk that is gonna be burdensome to folks who want to invest with their values. I call up accessibility likewise ways the onboarding experience and reduction of friction.

For instance, we could've created our product and had you sign upwards, ship us back a 12-folio document, fax back a signature, correct? Simply we didn't want to practice that. We know that nosotros're dealing with wonderfully busy people who want to do good. And so how do nosotros make it easier for them to invest with their values? We put it online and [take a] banking company-level encrypted high security environment where investors tin feel safe, where investors can feel they've entered a trusted platform, and also accept the flexibility to toe-dip. You don't have to put $3 million to try this out and you don't even have to put information technology in for three years to effort this out. Then all of those things to us equal accessibility and actually aid do what we are passionate nigh, which is democratizing this opportunity.

The Wisdom Fund is simply a testament to that belief that if we do a better chore investing in women, and specifically women of color, the product of that is then powerful.

JP: You have your first, or flagship, product, which invests in women, minorities, and low-income communities throughout the U.S., and has variable returns. So you lot accept your new Wisdom Fund , which is a stock-still-income product, and invests specifically in women. Can y'all explicate why investing in women is a top priority for CNote?

CB: Women don't get enough venture majuscule, and that's an important problem to solve. But I would argue the bigger trouble is around access to upper-case letter for women doing small business, not venture-ready business. Those are the majority of businesses started by women, and that'due south really the wealth creator for women in the U.S. That's the problem we're addressing with the Wisdom Fund. And when you invest in women, I would argue 9 times out of 10 you're investing in something bigger than that woman. Because that woman volition not only go about creating jobs in her local community, she will take information technology even a step further and really expand the power of her business organisation. We meet it again and over again.

JP: Tin can y'all share an example of a woman CNote has been able to back up, who's done merely that?

CB: One of the women we've invested in, Yahaira Caraballo, is such a great example because non only did she abound a local nail salon business concern in the Southward Bronx and beginning hiring people and creating jobs, merely now she mentors other women entrepreneurs in the S Bronx. Another example is Cinde Dolphin, also a first-time entrepreneur [her product is Kili Medical Drain] ; she ended up including women on the base of Kilimanjaro every bit role of her supply chain and then that she could fund them and then that those women would have new sources of income to send their daughters to school.

JP: That'southward amazing!

CB: I have then many of these stories.  And the Wisdom Fund is only a testament to that conventionalities that if nosotros exercise a better job investing in women, and specifically women of colour, the product of that is so powerful. Almost inexplicably powerful. But nosotros need to see more of it.

The bigger problem is around access to capital for women doing small concern, not venture-ready business. Those are the bulk of businesses started by women, and that's really the wealth creator for women in the U.Due south.

JP: Do you invest directly in these women and their companies?

CB:  We work with Community Evolution Financial Institutions, or CDFIs. The CDFIs have been around for over 20 years, [with] incredibly inspiring impact and very strong financial performance. There are over i,000 CDFIs beyond the U.S., and when nosotros have CDFIs that are interested in joining our portfolio, nosotros put them through our three-part diligence process, and so one time they're in our portfolio, nosotros work with them on driving that flexible investment. Nosotros currently piece of work in over 37 states and accept CDFIs that run the gamut: CDFIs working on the environment, CDFIs working on food deserts, CDFIs funding women and minority businesses. It's tremendous, the breadth and depth of impact that these organizations are obviously delivering. And then we get to play that partnership part to make sure that investors are exposed to the high-performing, high-bear on CDFIs, and that CDFIs are getting admission to capital and exposure.

JP: Let'south talk about the Full Touch on conference. You probably constantly become invites to events—what made Total Bear on stand up out to you?

CB: Well I have a love thing with Philly. I retrieve years ago, touring the east coast and really just loving the free energy and the history behind Philadelphia. I too know that the wealth gap is felt prominently in Philadelphia, and that gentrification is a real and salient outcome in the city. And so for a lot of reasons I'm attracted to both the urban center and what's happening in the city.

And I retrieve every bit it relates to Total Touch, I have tremendous respect for those thought leaders and organizations that are trying to motion not simply the chat forward, but action forward. We've all been talking about this for a while; I would argue that many of those who are participating, take been working on this for years. But I do think nosotros're seeing a change from conversation to action. And how practise we speed that process up? And how do nosotros practice it thoughtfully? And how practise we practice it collaboratively?

I'm a big believer that we're only going to movement touch investing forward if we go new people in the room. Fresh perspectives in the room. And new people caring nigh this. And so clearly it's ane of the reasons nosotros think democratizing all of this is so very important. Where are the community voices, where is the varied and diverse sets of ethnicities and ages and opinions at the table? Getting to participate in all of that and and so really being part of the solution, not just the chat, is exciting to me.

Wednesday, May ane-ii, 8 am-v:xxx pm, discounted tickets for Denizen readers here, Convene, thirty S. 17th St.

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Source: https://thephiladelphiacitizen.org/the-citizen-recommends-impact-phls-total-impact/

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