In Times When Black Lives Finally Matter, Building Purpose-Driven Businesses is Key to Economic Empowerment
|The Opportunity Fund will invest only in companies led by people of color, and is the first such fund to be created in response to growing protests.|
Earlier this month and following the death of George Floyd, SoftBank announced a $100m investment fund for minority-owned businesses. The Opportunity Fund will invest only in companies led by people of color, and is the first such fund to be created in response to growing protests, in the US and worldwide, against racism and lack of equal opportunities for black people. While the initiative is not the first of its kind in the US or abroad (South Africa has several financial institutions dedicated to providing financial support to black entrepreneurs), its significance is much stronger now.
The US is in fact home to several financial institutions dedicated to supporting low- and moderate-income communities of color. However, as their relevance grows in the wake of the current crisis, their number has been steadily declining over the past years. One of the oldest such institution still in business today is the Unity National Bank. It is Texas’ only black-owned bank and an example of what purpose-driven businesses can accomplish for their communities and their country.
The Unity National Bank was established in the early 1960s and has since then supported the banking and capital needs of low- and moderate-income communities across Texas. While it used to operate in a banking industry with 47 African American-controlled banks in the early 2000s, the recession of 2008 took its toll on its peers. In 2019, the US had only 22 remaining black-owned banks.
Since 2005, the Unity National Bank is majority-owned by Nigeria-born oil executive Kase Lawal and his family. Kase Lawal is also Chairman of CAMAC International and seen as one of the few successful black entrepreneur in the energy sector, which remains an industry widely dominated by white men. He currently serves as Board Chairman of the Unity National Bank and, under his leadership, the bank has been able to weather the storm since 2008 and keep expanding. In 2018, it opened in Atlanta, its first expansion beyond the state of Texas, in order to consolidate and serve the African American community better.
Its lending program is focused on supporting and rebuilding its community, especially via commercial and mortgage loans. Unity National Bank has forged a network of partners and agents that are able to support the very core of its activities, from lending to supporting financial literacy across community.
While the bank, like other African American-owned banks, has struggled in recent years due to its smaller size and financial performances, its management is putting the foundations in place for the business to continue growing. It recently partnered with Citigroup and introduced a Paycheck Protection Program (PPP), which reportedly allowed the saving of 3,000 jobs. The PPP loans, acclaimed for their support to small black-owned businesses, even earned Unity National Bank a visit by Vice President Mike Pence this year.
“Kase Lawal is real, a legend. He is an improbable driver for black empowerment through entrepreneurship, even as most people never saw him coming and counted him out. I am not surprised that he will rise to the occasion, walk the walk and execute during these times when our communities are dealing with the scourge of Covid19 and difficult economic conditions,” stated NJ Ayuk Executive Chairman of the African Energy Chamber. “His humanity and humility lets him walk with the little guy and still keep his virtue. He may seat with Presidents and Ministers yet never loses the common touch or forgets where he came from. He is always thinking about the poor and the upward mobility of those who have not been dealt a fair hand by our economy,” added Mr Ayuk.
Now that the Covid-19 pandemic has taken its toll on American jobs and lives, and even more so for African American communities, and at a time when the world calls for better support to black entrepreneurs and businesses, the Kase Lawal-chaired institution is set to benefit. It remains one of the few institutions in the US with a true purpose of working with communities and linking their fate together to create a better future for African American families and gives countless of talented young women and men the means to build a successful future.
As the world seeks new ways to build equal societies, developing successful business models that promote equal opportunities and bring much-needed capital to talented communities is becoming the need of the hour. In doing so, looking at black-owned banks and businesses and learning from their experience would prove very beneficial. Beyond looking at pure business principles and balance sheets fundamentals, these companies are driven by a true social purpose which could well be the kind of basis the world needs to build fairer societies.
*Africa Energy Chamber