Systemic Racism in Education: A Persistent Problem

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Key Takeaways:
  • Systemic racism in education refers to the entrenched racial disparities in systems and policies that negatively impact the U.S. education system.
  • Systemic racism permeates almost every aspect of the U.S. education system. Common examples include inequitable funding, a lack of diverse curricula and an underrepresentation of teachers from different cultures.
  • To fix systemic racism in education, government officials need to implement comprehensive reforms and policy changes. However, there are steps that educators and caregivers can take to mitigate it.

Table of Contents

    From an early age, many of us are told that the path to success starts with doing well in school. If you work hard enough and do your best, you will be rewarded. However, this promise is more of a fantasy than a reality for some people, especially for those from underrepresented communities.
    This is the direct result of an issue that has permeated the U.S. education system since the country’s inception: systemic racism. The obstacles created by systemic racism in the education system have negatively impacted generations of students from underrepresented communities. Many of these barriers continue to limit the success of students from marginalized groups.
    Below, we explore what systemic racism in education is, including a brief history. In addition, we highlight common examples of systemic racism in education and solutions.

    What Is Systemic Racism in Education?

    Systemic racism in education explains the embedded racial inequities that adversely affect the U.S. education system. To better understand, it may help to break down how racism and systemic racism are connected.
    Racism refers to the oppression of people based on race on an individual basis. Systemic racism is that same oppression but extended beyond individuals. Essentially, racism becomes ingrained in the systems and organizations within society. Systemic racism is the reason organizations and systems mirror individual racism.
    Systemic racism in education includes any education-related systems, laws, policies, actions or beliefs that accept and continue the unfair treatment of people from underrepresented groups. These deeply rooted issues manifest in barriers that make the road to success harder for marginalized communities. Some of these barriers include disparities in funding, resources and access to quality education.

    The History of Systemic Racism in Education

    The history of systemic racism in education dates back hundreds of years. Centuries of discrimination led to the formation of separate school systems. Schools developed for Black Americans, for example, commonly received less funding than schools with primarily white student populations. In addition, schools for marginalized groups often faced overcrowding, a lack of supplies and inequitable pay for education professionals.
    These disparities negatively impacted the educational opportunities available to Black students. According to the U.S. Census Bureau, just 7% of Black Americans earned a high school degree in 1940 compared with the national average of 24% at the time.
    The Civil Rights Movement of the 1960s led to the desegregation of public schools through measures like court-ordered busing that forced school districts to diversify. Cases like Brown v. Board of Education were major civil rights victories for Black Americans, but implementing the new laws was commonly met with resistance. Even after schools were integrated, inequitable funding, resources and school content continued to harm opportunities for Black students to gain equitable learning experiences. Many of these issues remain problematic for students from underrepresented communities today.

    Five Examples of Systemic Racism in Education

    Systemic racism impacts nearly every aspect of the U.S. education system. Examples of systemic racism in education include unequal funding, a lack of diverse curricula and an underrepresentation of Black and Brown teachers, among others. Ahead, we discuss examples of systemic racism in education in more detail.

    1. Unequal Funding

    School funding is essential to creating a safe and well-rounded educational experience for students. Disparities in school funding throughout the U.S. is an issue for many schools that primarily serve students from underrepresented communities.
    Public school funding often comes from property taxes, which means schools in wealthier neighborhoods are usually funded better than schools in poorer areas. Black and Latino households hold less than 3% of the wealth in the U.S., which usually results in less funding for schools in Black and Latino neighborhoods.
    According to data from EdBuild, predominantly nonwhite schools across the U.S. receive $23 billion less annually than majority-white districts. Schools with less funding are more likely to be understaffed and have fewer resources, making them more likely to underperform compared to schools that serve a primarily white student population.

    2. Unfair Disciplinary Actions

    Students from underrepresented communities, particularly Black students, commonly face disproportionate amounts of disciplinary action compared with their white peers. According to research published by the American Psychological Association, these punishments can harm a student’s educational experience and have a negative impact on their future success.
    A study conducted by the same organization found that 26% of Black students were suspended for small infractions over a three-year period. In the same time frame, just 2% of white students were suspended for similar offenses. The implementation of zero-tolerance policies in U.S. public schools led to an increase in these disciplinary disparities.
    These policies stem from the Gun-Free Schools Act (GFSA). Originally, the act was created to outline punishments for bringing a firearm to school, but it led to the formation of zero-tolerance policies to include other transgressions. These policies have exacerbated the school-to-prison pipeline. This pipeline explains the policies or systems that inequitably lead students from underrepresented communities into the criminal justice system.
    The discriminatory use of these measures and calls to law enforcement make this problem worse. When students from marginalized communities are unfairly impacted by these policies, it can set them up for long-term failure.

    3. A Lack of Diverse Curricula

    It is integral that school materials are as diverse as the population they serve. Providing students with materials that reflect their culture and that of their peers nurtures a sense of inclusion. In addition, it acknowledges the presence of diverse identities and cultivates an educational setting where every student can excel. While, in most cases, curriculum materials have become more diverse, and teachers have adopted new teaching practices in the last few decades, studies show that significant disparities still remain.
    In recent years, government officials have developed and passed policies that dictate teaching practices and what materials teachers can use in classrooms. Many of the materials that teachers are restricted from using include mentions of race. Data published by book publisher Lee & Low indicates that just 13% of children’s books depicted diverse content in the last 20+ years. Over the same period, the research also shows that only 7% of authors were people from underrepresented communities. It also highlighted the fact that required school reading lists are primarily comprised of classic books. Many of these classics primarily depict the white middle-class to upper-class experience.
    This lack of diversity is not limited to children’s books. A study highlighted by Edutopia, shows that the pictures used in U.S. history textbooks primarily depict white, European Americans, sometimes more than 80%. By comparison, the research shows that people from underrepresented communities are barely represented. To put it into perspective, the representation of some racial groups in the same textbooks studied was as low as 1%.

    4. Racial Achievement Gaps

    While there has been progress in reducing learning disparities since the Civil Rights Movement, there is still much work to be done to bridge the racial achievement gap. In simple terms, the racial achievement gap is a way to compare the educational and professional success of one racial group with another. The primary way the U.S. gauges growth is through standardized tests administered by the National Assessment of Educational Progress (NAEP).
    NAEP, also known as “the nation’s report card,” tests the academic capabilities of a sample of students in different age groups every few years. According to an analysis done by Stanford CEPA, the achievement gaps have shrunk significantly since the 1970s. Progress stagnated, and achievement gaps grew in the mid-1980s and into the 1990s. But, recent data shows that the achievement gaps continued to shrink again after the 1990s.
    During the 2022-2023 school year, the National Center for Education Statistics (NCES) measured the skills in reading and math of 13-year-old students. The math results revealed that Black students scored a 13-point decrease compared with the six-point decrease of their white peers. This decrease boosted the Black-white achievement gap from 35 points in 2020 to 42 points in 2023.

    5. Underrepresentation of Black and Brown Teachers

    Having a diverse teaching staff offers many benefits to students of all racial backgrounds. A summary of a study conducted by the Learning Policy Institute found positive impacts for students from underrepresented communities who have teachers who look like them. Some of these benefits include better academic performances, better reading and math scores, fewer absences and higher graduation rates.
    Today, there is a significant lack of Black and Brown teachers in classrooms throughout the U.S. Many attribute this disparity to the Brown v. Board decision. While a crucially important and precedent-setting case, it significantly impacted Black teachers.
    When schools were ordered to integrate in 1954, schools for Black students were shut down. As a result, thousands of experienced and credentialed Black teachers were fired or pushed to resign. Since the decision, the Black teacher and education leadership pipeline never fully rebounded.
    Before the Brown decision, Black teachers accounted for 35% to 50% of public school teachers in the 17 states that had Black-only schools. Data reported by TIME in January 2022 shows that just a little more than 20% of U.S. public school teachers identify as people from underrepresented communities. Of that percentage, only 7% classified themselves as Black.

    How to Change the Course of Systemic Racism in Education

    All forms of systemic racism, including systemic racism in education, are deeply ingrained in U.S. social, economic and political systems. Given it is such a multifaceted challenge, it requires comprehensive reforms and policy changes to dismantle.
    Federal and local officials and school district leaders can certainly seek remedies in their official capacities. But, caregivers and education professionals can also take steps toward progress. Some of these steps include the following:
    • Caregivers and educators should make a concerted effort to build genuine relationships to keep track of how students are doing.
    • Education professionals should be required to complete anti-bias training. This can help mitigate discrimination or assumptions about different cultures.
    • Caregivers and education professionals should advocate for students from underrepresented communities.
    • Families and educators need to advocate for leadership diversity within schools and school districts.
    To learn more about other important topics, follow Robert F. Smith on LinkedIn. And see what Smith has to say about systemic racism in the video below.

    Across our Communities

    MBE Entrepreneurship & Supplier Diversity

    1. Provide technical expertise: offer subject matter and technical expertise to catalyze and support community initiatives 

    E.g., tax/accounting experts to help MBEs file taxes

    E.g., business experts to help MBEs better access capital and craft business plans to scale their teams and operations

    Access to Capital (CDFI/MDI)

    2. Fund modernization & capacity-building and provide in-kind subject matter experts – $30M: help 4-5 CDFIs/MDIs over 5 years modernize their core systems, hire and train staff, expand marketing and standup SWAT team of experts to conduct needs diagnostic, implement tech solution & provide technical assistance

    Systems and technology modernization – $10M-15M: Add/upgrade core banking systems, hardware and productivity tools, train frontline workforce on new systems & technology and hire engineering specialists to support customization and news systems rollout – over 5 years

    Talent and workforce – $10M: hire and train additional frontline lending staff and invest in recruiting, training, compensation & benefits and retention to increase in-house expertise and loan capacity – over 5 years

    Other capacity-building and outreach – $8M: hire additional staff to increase custom borrower and technical assistance (e.g., credit building, MBE financing options, etc.) and increase community outreach to drive regional awareness and new pipeline projects – over 5 years

    Education/HBCU & Workforce Development

    3. Offer more paid internships: signup onto InternX and offer 25+ additional paid internships per year to HBCU/Black students 

    Digital Access

    4. Issue digital access equality bonds: issue equality progress bonds and invest proceeds into SCI’s digital access initiatives

    5. Fund HBCU campus-wide internet – up to $50M in donations or in-kind: Partner with the Student Freedom Initiative to deliver campus-wide high-speed internet at ~10 HBCUs across SCI regions

    Advocacy

    6. Be an advocate for SCI priorities: engage federal and state agencies to drive policy and funding improvements to better support SCI’s near-term priorities

    E.g., Engage the Small Business Administration and Minority Business Development Agency to increase technical assistance programs and annual spend to better support Minority Business Enterprises (MBEs) with capital and scaling needs

    E.g., Ask the Federal Communications Commission (FCC) to include multi-dwelling unit connectivity in its new broadband connectivity maps and ask the National Telecommunications and Information Administration (NTIA) to allow non-FCC data in state broadband plans to unlock ~$285M in potential government broadband funding for 5 SCI regions

    Directly Fund SCI

    7. Invest directly into SCI (coming soon): provide funding for SCI to pool and invest in community initiatives that are most well-positioned for funding and can drive direct community impact.

    Memphis, Tennessee

    Lead community organization: The Collective Blueprint

    MBE Entrepreneurship & Supplier Diversity

    Our ambition:

    Increase the volume and value of Black-owned businesses – through corporate MBE spend and MBE startups & scaling

    1. Scale technical assistance – $15M: fund* to expand technical assistance through business coaches and wrap-around services for 500+ MBEs over 5 years to help them scale from <$1M to $5M+ in annual revenue

    2. Standup MBE fund – $15M: standup/scale MBE fund* to offer more flexible access to capital arrangements 400-500 MBEs over 5 years

     * Lead organization: The Collective Blueprint; Contributing local organizations for community strategy include (but not limited to): Community Unlimited, Women’s Business Center South, Epicenter, others

    Estimated impact (of all initiatives): 2.3x increase in MBE value & 20K+ new jobs, boosting Black community’s net worth by ~$3B+

    Access to Capital (CDFI/MDI)

    Our ambition:

    Modernize CDFI/MDI systems and tech as well as recruit and upskill talent to increase CDFI/MDI capacity and ability to inject more capital into Black communities

    3. Provide loan guarantees – $15M: create a fund* to provide 80% loan guarantees over 5 years to encourage lender participation and inject more capital into the community

    4. Conduct advocacy: ask US Treasury & Tennessee State to allow Tennessee CDFIs/MDIs to retain SSBCI capital & offer loan guarantees to boost loan issuance

    5. Fund modernization & capacity-building and provide in-kind subject matter experts – $30M: help 4-5 CDFIs/MDIs** over 5 years modernize their core systems, hire and train staff, expand marketing and standup a SWAT team of experts to conduct needs diagnostic, implement tech solution & provide technical assistance

    • Systems and technology modernization – $10M-15M: Add/upgrade core banking systems, hardware and productivity tools, train frontline workforce on new systems & technology and hire engineering specialists to support customization and news systems rollout – over 5 years
    • Talent and workforce – $10M: hire and train additional frontline lending staff and invest in recruiting, training, compensation & benefits and retention to increase in-house expertise and loan capacity – over 5 years
    • Other capacity-building and outreach – $8M: hire additional staff to increase custom borrower and technical assistance (e.g., credit building, MBE financing options, etc.) and increase community outreach to drive regional awareness and new pipeline projects – over 5 years

    * Leading organizations for community strategy include (but not limited to): Community LIFT, Memphis CDFI Network, etc.

    * In partnership with National Bankers Association and Appalachian Community Capital; CDFIs/MDIs being considered include: Community Unlimited, Hope Credit Union, River City Capital, United Housing Inc, etc.

    Estimated impact (of all initiatives): ~$330M+ in additional loans per year to support ~30K+ MBEs

    Education/HBCU & Workforce Development

    Our ambition:

    Lower financial burden for Black students, increase number of Black college graduates, increase Black workforce and executive representation and their access to high-paying jobs

    6. Standup training hub – $30M: fund* the establishment a world-class training hub that offers certificate-granting STEM and innovation programs in advanced manufacturing, health care, etc. to 10K+ youths

    7. Fund SFI program – $7M: fund the Student Freedom Initiative’s Income Contingent Alternative to Parent Plus to support ~15 Black STEM students per year forever at 4 HBCUs**

    * Lead organization: The Collective Blueprint; Contributing local organizations for community strategy include (but not limited to): Greater Memphis Chamber and Workforce Midsouth

    ** Minority Serving Institutions / HBCUs with STEM programs being considered: Le Moyne-Owen, Baptist Memorial, University of Memphis, Rust College

    Estimated impact (of all initiatives): 8K+ additional college graduates and 10K workers with high-paying wages to drive ~$1B+ in economic growth

    Digital Access

    Our ambition:

    Increase accessibility, affordability and adoption of high-speed Internet

    8. Accelerate digital access initiatives – $75M: partner with local orgs* to invest in setting up internet connections / installing hotspots, offering laptops and supporting adoption (through government subsidy technical assistance and digital literacy) to connect ~135K homes to high-speed internet in the Memphis region

    9. Raise community awareness & adoption of Emergency Broadband Benefit: increase door-to-door and community outreach in low-income neighborhoods to get households onto EBB to help connect ~135K unconnected households 

     * Lead organization: The Collective Blueprint; Contributing local organizations for community strategy include (but not limited to): CodeCrew

    Estimated impact (of all initiatives): ~135K households connected to high-speed internet to unlock ~$2B+ in economic potential

    Houston, Texas

    Lead community organization: Greater Houston Partnership

    MBE Entrepreneurship & Supplier Diversity

    Our ambition:

    Increase the volume and value of Black-owned businesses – through corporate MBE spend and MBE startups & scaling

    1. Scale team – ~$3M: hire 3-4 FTEs over 5 years for One Houston Together* to help companies increase MBE spend from ~2% to 5-10%+ as well as BIPOC workforce advancement and BIPOC board representation 

    2. Increase MBE certification and scale technical assistance – ~$2M: partner with One Houston Together* and the Houston Minority Supplier Development Council (HSMDC)** to certify additional MBEs, develop Minority Business Finder database tool and provide resources and services to help local MBEs scale and participate in Pathways to Excellence program

    3. Commit to increase racial diversity in supply chain and procurement: increase MBE spend in Greater Houston region* to 5-10%+

    * One Houston Together serves as lead (please contact if you are interested in funding these initiatives)

    ** Houston Minority Supplier Development Council (HSMDC) serves as a partner organization (please contact if you are interested in learning more about this initiative)

    Estimated impact (of all initiatives): 2.5x increase in MBE value & ~55K new jobs, boosting Black community’s net worth by ~$12B 

    Access to Capital (CDFI/MDI)

    Our ambition:

    Modernize CDFI/MDI systems and tech as well as recruit and upskill talent to increase CDFI/MDI capacity and ability to inject more capital into Black communities

    4. Fund modernization & capacity-building and provide in-kind subject matter experts – $30M: help 4-5 CDFIs/MDIs* over 5 years modernize their core systems, hire and train staff, expand marketing and standup SWAT team of experts to conduct needs diagnostic, implement tech solution & provide technical assistance

    • Systems and technology modernization – $10M-15M: Add/upgrade core banking systems, hardware and productivity tools, train frontline workforce on new systems & technology and hire engineering specialists to support customization and news systems rollout – over 5 years
    • Talent and workforce – $10M: hire and train additional frontline lending staff and invest in recruiting, training, compensation & benefits and retention to increase in-house expertise and loan capacity – over 5 years
    • Other capacity-building and outreach – $8M: hire additional staff to increase custom borrower and technical assistance (e.g., credit building, MBE financing options, etc.) and increase community outreach to drive regional awareness and new pipeline projects – over 5 years

    * In partnership with National Bankers Association and Appalachian Community Capital; CDFIs/MDIs being considered include: Unity National Bank, Unity Bank of Texas, PeopleFund, Houston Business Development Inc, etc.

    Estimated impact (of all initiatives): ~$330M in additional loans per year to support ~30K MBEs

    Education/HBCU & Workforce Development

    Our ambition:

    Lower financial burden for Black students, increase number of Black college graduates, increase Black workforce and executive representation and their access to high-paying jobs

    5. Fund SFI program – $120M: fund the Student Freedom Initiative’s Income Contingent Alternative to Parent Plus* to support ~1.2K Black STEM students per year forever at 7 HBCUs**

    * Student Freedom Initiative serves as lead (main contact if you are interested in learning more and funding this initiative)

    ** Minority Serving Institutions / HBCUs with STEM programs being considered: Texas Southern University, University of Houston, Prairie View A&M University, Houston Baptist University, University of Houston-Clear Lake, University of Houston-Downtown, University of St Thomas.  

    Estimated impact (of all initiatives): 5K+ additional college grads & ~600 workers with senior exec positions / high-paying wages to drive ~$0.2B in economic growth

    Digital Access

    Our ambition:

    Increase accessibility, affordability and adoption of high-speed Internet

    6. Accelerate SCI’s digital access initiatives – up to $80M in donations or in-kind: invest in setting up internet connections / hotspots, offer laptops/Chromebooks and support adoption (through government subsidy technical assistance and digital literacy) to connect ~145K homes to high-speed internet in the Houston region*

    7. Raise community awareness & adoption of Emergency Broadband Benefit: increase door-to-door and community outreach in low-income neighborhoods to get households onto EBB to help connect ~145K unconnected households 

    * Community organization(s) being identified 

    Estimated impact (of all initiatives): ~145K households connected to high-speed internet to unlock ~$3B in economic potential

    Greater New Orleans, Louisiana

    Lead community organization: Urban League of Louisiana

    MBE Entrepreneurship & Supplier Diversity

    Our ambition:

    Increase the volume and value of Black-owned businesses – through corporate MBE spend and MBE startups & scaling

    1. Scale Black Business Works Fund – $10M: grow the Urban League of Louisiana’s Black Business Works Fund to support ~3K-4K MBEs over 5 years with emergency working capital needs to support/sustain ~$1B+ in annual revenues

    2. Scale technical assistance – $20M: fund the Urban League of Louisiana, New Orleans Business Alliance, Thrive New Orleans and Propellor to scale bookkeeping, B2C payment, marketing support & subsidized rent to scale 200+ MBEs from <$1M to $5M+ in annual revenue

    Estimated impact (of all initiatives): 2.5x increase in MBE value & 8K+ new jobs, boosting Black community’s net worth by ~$2B+

    Access to Capital (CDFI/MDI)

    Our ambition:

    Modernize CDFI/MDI systems and tech as well as recruit and upskill talent to increase CDFI/MDI capacity and ability to inject more capital into Black communities

    3. Fund modernization & capacity-building and provide in-kind subject matter experts – $30M: help 4-5 CDFIs/MDIs* over 5 years modernize their core systems, hire and train staff, expand marketing and standup SWAT teams to conduct needs diagnostic, implement tech solution & provide technical assistance

    • Systems and technology modernization – $10M-15M: Add/upgrade core banking systems, hardware and productivity tools, train frontline workforce on new systems & technology and hire engineering specialists to support customization and news systems rollout – over 5 years
    • Talent and workforce – $10M: hire and train additional frontline lending staff and invest in recruiting, training, compensation & benefits and retention to increase in-house expertise and loan capacity – over 5 years
    • Other capacity-building and outreach – $8M: hire additional staff to increase custom borrower and technical assistance (e.g., credit building, MBE financing options, etc.) and increase community outreach to drive regional awareness and new pipeline projects – over 5 years

    * In partnership with National Bankers Association and Appalachian Community Capital; CDFIs/MDIs being considered include: New Orleans Business Alliance (community convener), Liberty, TruFund, LiftFund, NewCorp, etc.

    Estimated impact (of all initiatives): ~$330M in additional loans per year to support ~30K MBEs

    Education/HBCU & Workforce Development

    Our ambition:

    Lower financial burden for Black students, increase number of Black college graduates, increase Black workforce and executive representation and their access to high-paying jobs

    4. Subsidize internships & apprenticeships – $40M: fund the New Orleans Youth Alliance, YouthForce NOLA and the Urban League of Louisiana to place and help subsidize apprenticeships, internships and other work-based learning experiences for ~20K young adults in high-pay sectors (e.g., energy)

    5. Fund SFI program – $12M: fund the Student Freedom Initiative’s Income Contingent Alternative to Parent Plus to support ~120 Black STEM students per year forever at 3 HBCUs*

    * Minority Serving Institutions / HBCUs being considered: Dillard University, Southern University – New Orleans and Xavier University of Louisiana

    6. Scale career prep – ~$10M: scale the New Orleans Youth Alliance and YouthForce NOLA with 15-20 coaches over 5 years to equip ~20K young adults with skills for high-paying industries, job search & prep and subsidized transportation

    Estimated impact (of all initiatives): ~2K additional college graduates and ~20K workers with high-paying wages to drive ~$1B in economic growth

    Digital Access

    Our ambition:

    Increase accessibility, affordability and adoption of high-speed Internet

    7. Accelerate SCI’s digital access initiatives – up to $35M in donations or in-kind: partner with New Orleans’s Office of Information Technology & Innovation and Education SuperHighway to invest in setting up internet connections / hotspots, offering laptops/Chromebook and supporting adoption (through government subsidy technical assistance and digital literacy) to connect ~55K homes to high-speed internet in Greater New Orleans region

    8. Raise community awareness & adoption of Emergency Broadband Benefit: increase door-to-door and community outreach in low-income neighborhoods to get households onto EBB to help connect ~55K unconnected households

    Estimated impact (of all initiatives): 55K households connected to high-speed internet to unlock ~$1B in economic potential

    Charlotte, North Carolina

    Lead community organization: Charlotte Regional Business Alliance

    MBE Entrepreneurship & Supplier Diversity

    Our ambition:

    Increase the volume and value of Black-owned businesses – through corporate MBE spend and MBE startups & scaling

    1. Offer in-kind FTEs: provide 2-5 in-kind FTEs to the Charlotte Regional Business Alliance (CRBA) over 5 years to convene corporate partners, assess their MBE spend, develop pipeline to increase MBE spend to 5-10%+

    2. Offer technical assistance expertise: partner with the Charlotte Regional Business Alliance (CRBA) to advise/mentor ~200 MBEs on capital/loan access to help them scale from <$10M to $50M+

    3. Commit to supplier diversity: increase MBE spend in Charlotte region to 5-10%+

    Estimated impact (of all initiatives): 3x increase in MBE value & ~13K new jobs, boosting Black community’s net worth by ~$2B+

    Access to Capital (CDFI/MDI)

    Our ambition:

    Modernize CDFI/MDI systems and tech as well as recruit and upskill talent to increase CDFI/MDI capacity and ability to inject more capital into Black communities

    4. Fund modernization & capacity-building and provide in-kind subject matter experts – $30M: help 4-5 CDFIs/MDIs* over 5 years modernize their core systems, hire and train staff, expand marketing and standup SWAT team of experts to conduct needs diagnostic, implement tech solution & provide technical assistance; in-kind experts to also help build out the MBE ecosystem through CDFIs/MDIs, market CDFI/MDI offerings and programs and help draft final loan agreements to qualify borrowers between investment fund(s) and CDFIs/MDIs

    * CDFIs/MDIs being considered (examples and not exhaustive): Security Federal Bank, Institute / North Carolina Community Development Initiative, Sequoyah Fund Inc, Self-Help Credit Union, BEFCOR, Aspire Community Capital, etc.

    • Systems and technology modernization – $10M-15M: Add/upgrade core banking systems, hardware and productivity tools, train frontline workforce on new systems & technology and hire engineering specialists to support customization and news systems rollout – over 5 years
    • Talent and workforce – $10M: hire and train additional frontline lending staff and invest in recruiting, training, compensation & benefits and retention to increase in-house expertise and loan capacity – over 5 years
    • Other capacity-building and outreach – $8M: hire additional staff to increase custom borrower and technical assistance (e.g., credit building, MBE financing options, etc.) and increase community outreach to drive regional awareness and new pipeline projects – over 5 years

    * In partnership with National Bankers Association and Appalachian Community Capital; CDFIs/MDIs being considered include: Security Federal Bank, Institute / North Carolina Community Development Initiative, Sequoyah Fund Inc, etc.

    Estimated impact (of all initiatives): ~$330M in additional loans per year to support ~30K MBEs

    Education/HBCU & Workforce Development

    Our ambition:

    Lower financial burden for Black students, increase number of Black college graduates, increase Black workforce and executive representation and their access to high-paying jobs

    5. Fund SFI program – up to $10M: fund the Student Freedom Initiative’s HELPS program to support ~1.5K+ students per year at HBCUs* with emergency expenses – e.g., unexpected health costs, late rent payments, etc.

    * Minority Serving Institutions / HBCUs in Charlotte that are being considered: Johnson C. Smith University, Johnson & Wales University – Charlotte, Charlotte Christian College

    6. Provide in-kind staff: offer 2-5 FTEs to the Charlotte Regional Business Alliance (CRBA)over 5 years to track Black-/Brown-executive representation, convene corporate partners to develop executive pipeline and hiring plans and support corporate partners to increase representation from ~10% to 30%+

    Estimated impact (of all initiatives): 2.5K+ additional college graduates and 2.5K workers with high-paying wages to drive ~$0.2B in economic growth

    Digital Access

    Our ambition:

    Increase accessibility, affordability and adoption of high-speed Internet

    7. Raise community awareness & adoption of Emergency Broadband Benefit: increase door-to-door and community outreach in low-income neighborhoods to get households onto EBB to help connect ~35K unconnected households

    Estimated impact (of all initiatives): ~35K households get connected to high-speed internet to unlock ~$700M in economic potential for Charlotte

    Birmingham, Alabama

    Lead community organization: Prosper Birmingham

    MBE Entrepreneurship & Supplier Diversity

    Our ambition:

    Increase the volume and value of Black-owned businesses – through corporate MBE spend and MBE startups & scaling

    1. Fund startups and give access to investor network – $70M: grow the Prosper Health Tech Fund – powered by Gener8tor – and offer venture capital technical assistance to scale 50+ startups from <$1M to $5M+ in annual revenue; near-term priority is to secure $4M in venture investment by end of May 2022

    2. Fund technical assistance – $25M: fund Prosper Birmingham, Magic City Match, and Birmingham Business Alliance to establish/expand business advisory programs, renovate and subsidize retail/office space for MBEs and scale coaches & support services (e.g., digital footprint, B2C platforms, accounting & bookkeeping, recruitment, etc.) to help 100+ MBEs scale from <$1M to $5M+ in annual revenue

    Estimated impact (of all initiatives): 3x increase in annual MBE revenue & 8K+ new jobs, boosting Black community’s net worth by ~$2B+

    Access to Capital (CDFI/MDI)

    Our ambition:

    Modernize CDFI/MDI systems and tech as well as recruit and upskill talent to increase CDFI/MDI capacity and ability to inject more capital into Black communities

    3. Fund modernization & capacity-building and provide in-kind subject matter experts – $30M: help 4-5 CDFIs/MDIs* over 5 years modernize their core systems, hire and train staff, expand marketing and standup SWAT team of experts to conduct needs diagnostic, implement tech solution & provide technical assistance

    • Systems and technology modernization – $10M-15M: Add/upgrade core banking systems, hardware and productivity tools, train frontline workforce on new systems & technology and hire engineering specialists to support customization and news systems rollout – over 5 years
    • Talent and workforce – $10M: hire and train additional frontline lending staff and invest in recruiting, training, compensation & benefits and retention to increase in-house expertise and loan capacity – over 5 years
    • Other capacity-building and outreach – $8M: hire additional staff to increase custom borrower and technical assistance (e.g., credit building, MBE financing options, etc.) and increase community outreach to drive regional awareness and new pipeline projects – over 5 years

    * In partnership with National Bankers Association and Appalachian Community Capital; CDFIs/MDIs being considered include: First Bancshares, Commonwealth National Bank, TruFund, Sabre Finance, Bronze Valley, etc.

    Estimated impact (of all initiatives): ~$330M in additional loans per year to support ~30K MBEs

    Education/HBCU & Workforce Development

    Our ambition:

    Lower financial burden for Black students, increase number of Black college graduates, increase Black workforce and executive representation and their access to high-paying jobs

    4. Fund scholarships and hire coaches – ~$35M: scale Birmingham Promise fund to financially support 200-250 students per year over 4 years to increase college retention and graduation rates

    5. Fund endowment – $2M: support 50 University of Alabama at Birmingham college students per year with housing to reduce their financial burden and increase college retention and graduation rates

    Estimated impact (of all initiatives): 6.5K+ additional college graduates & 35K workers with high-paying wages to drive ~$1.2B in economic growth

    Digital Access

    Our ambition:

    Increase accessibility, affordability and adoption of high-speed Internet

    6. Raise community awareness & adoption of Emergency Broadband Benefit: increase door-to-door and community outreach in low-income neighborhoods to get households onto EBB to help connect ~35K unconnected households

    Estimated impact (of all initiatives): 48K households get connected to high-speed internet to unlock ~$700M in economic potential for Jefferson County

    Birmingham, Alabama

    Lead community organization: Prosper Birmingham

    MBE Entrepreneurship & Supplier Diversity

    Our ambition:

    Increase the volume and value of Black-owned businesses – through corporate MBE spend and MBE startups & scaling

    1. Fund startups and give access to investor network – $70M: grow the Prosper Health Tech Fund – powered by Gener8tor – and offer venture capital technical assistance to scale 50+ startups from <$1M to $5M+ in annual revenue; near-term priority is to secure $4M in venture investment by end of May 2022

    2. Fund technical assistance – $25M: fund Prosper Birmingham, Magic City Match, and Birmingham Business Alliance to establish/expand business advisory programs, renovate and subsidize retail/office space for MBEs and scale coaches & support services (e.g., digital footprint, B2C platforms, accounting & bookkeeping, recruitment, etc.) to help 100+ MBEs scale from <$1M to $5M+ in annual revenue

    Estimated impact (of all initiatives): 3x increase in annual MBE revenue & 8K+ new jobs, boosting Black community’s net worth by ~$2B+

    Access to Capital (CDFI/MDI)

    Our ambition:

    Modernize CDFI/MDI systems and tech as well as recruit and upskill talent to increase CDFI/MDI capacity and ability to inject more capital into Black communities

    3. Fund modernization & capacity-building and provide in-kind subject matter experts – $30M: help 4-5 CDFIs/MDIs* over 5 years modernize their core systems, hire and train staff, expand marketing and standup SWAT team of experts to conduct needs diagnostic, implement tech solution & provide technical assistance

    Systems and technology modernization – $10M-15M: Add/upgrade core banking systems, hardware and productivity tools, train frontline workforce on new systems & technology and hire engineering specialists to support customization and news systems rollout – over 5 years

    Talent and workforce – $10M: hire and train additional frontline lending staff and invest in recruiting, training, compensation & benefits and retention to increase in-house expertise and loan capacity – over 5 years

    Other capacity-building and outreach – $8M: hire additional staff to increase custom borrower and technical assistance (e.g., credit building, MBE financing options, etc.) and increase community outreach to drive regional awareness and new pipeline projects – over 5 years

    * In partnership with National Bankers Association and Appalachian Community Capital; CDFIs/MDIs being considered include: First Bancshares, Commonwealth National Bank, TruFund, Sabre Finance, Bronze Valley, etc.

    Estimated impact (of all initiatives): ~$330M in additional loans per year to support ~30K MBEs

    Education/HBCU & Workforce Development

    Our ambition:

    Lower financial burden for Black students, increase number of Black college graduates, increase Black workforce and executive representation and their access to high-paying jobs

    4. Fund scholarships and hire coaches – ~$35M: scale Birmingham Promise fund to financially support 200-250 students per year over 4 years to increase college retention and graduation rates

    5. Fund endowment – $2M: support 50 University of Alabama at Birmingham college students per year with housing to reduce their financial burden and increase college retention and graduation rates

    Estimated impact (of all initiatives): 6.5K+ additional college graduates & 35K workers with high-paying wages to drive ~$1.2B in economic growth

    Digital Access

    Our ambition:

    Increase accessibility, affordability and adoption of high-speed Internet

    6. Raise community awareness & adoption of Emergency Broadband Benefit: increase door-to-door and community outreach in low-income neighborhoods to get households onto EBB to help connect ~35K unconnected households

    Estimated impact (of all initiatives): 48K households get connected to high-speed internet to unlock ~$700M in economic potential for Jefferson County