Last week my wife and I went to see a movie called “A Case for Love,” a documentary which highlighted the work of Bishop Michael Curry.  This film showcased a series of interviews with everyday Americans around the country. It chronicled their stories, their struggles, and ultimately made the case for more brotherly love and understanding between us all, a universal love and altruism, often described by the Greek word agape.

Rob Kornblum

One story in the film was about a young Black man who had been jailed for possession of a firearm. He spoke of what it had been like in prison, and how the system is set up so that young men like him will fail. He was describing the prison system, but he could easily have been referencing the education system, the unemployment system, or most of the safety net and support systems that have been established to help low-income people.

As a country with so much wealth, it is seemingly unimaginable that the United States has the levels of poverty and income inequality that we do. Almost one in nine Americans live in poverty, and over 100 million Americans live on $55,000 a year or less, not at poverty levels, but not secure by any means (source: Poverty, By America, Matthew Desmond.) The numbers are even worse in terms of wealth. The top 10% of households hold 66.6% of household wealth (according to the St. Louis Federal Reserve), while the bottom 50% of households has only 2.6% of total household wealth.

The issues that impact poverty are significant and intertwined. Housing prices have skyrocketed over the last 20 years, as have rents. Healthcare is also extremely expensive, and the poor are often underinsured and trying to navigate Federal, State, and local programs. Decent food is expensive and difficult to obtain as “food deserts” grow in frequency. And of course, quality, stable, jobs are difficult to locate and more difficult to maintain. These issues produce a spiral of poverty, a vicious cycle from which it is extremely difficult to break free.

America also chooses to deal with many of these issues through incarceration. Many are incarcerated for petty crimes, or minor drug offenses. With only 4.2% of the world’s population, America has almost 20% of the world’s incarcerated.  Black Americans are incarcerated at a rate 5 times that of whites.

As with most highly complex challenges, we know that government, non-profits, and for-profit companies all have a role to play. In the for-profit area, we believe that high-growth startups can play a significant role in improving wealth and income.

Unlike government and philanthropy, high-growth companies can scale rapidly to touch hundreds of thousands or millions of people and do so efficiently and quickly. And they can innovate, using new technologies or business models to make their products more accessible, and more equitable.

Our VC fund aims to help address this type of economic despair within our economic opportunity thesis area. We seek out investments in for-profit companies that can help improve skills, wages, opportunities and wealth for low- and moderate-income Americans. We also seek to invest in startups which reduce the impact of the criminal justice system.

Our fund’s mission is to “close equity gaps” in America. We aren’t looking to close these gaps simply for moral reasons, although there are strong moral reasons to help people rise from poverty. We believe that economically healthy communities have a thriving middle class and also present opportunity for lower-income families to thrive and climb. Local and national economies operate more effectively for all with increased balance, with a more equitable breakdown of wealth, income, and opportunity. The Economic Policy Institute has shown that rising income inequality reduces overall GDP growth by 1.5% per year. The economy simply functions better when more people participate more equally.

Bringing new technologies, new approaches, and new business models to the market is key to solving decades-old challenges. We believe that talent is equally distributed, but opportunity has not been.

Chaarvi Badani

As my colleague Chaarvi Badani highlighted in her recent blog post, one area we are focused on is workforce development. Specifically, we look for companies that help low-and-moderate income Americans gain skills and knowledge that can improve their incomes. We want that training to be accessible in terms of cost. There are sectors where we know there are shortages of workers, and where that shortage will grow, such as nursing and other healthcare, the trades, manufacturing, and non-programming technology roles. These jobs generally do not require advanced degrees, and incremental training and credentials can produce meaningfully higher incomes. For example, our portfolio company EnGen and their partner Guild, Inc. provide workforce training for workplace language skills, provided by large employers like Amazon and Target.

Another area we invest in is improving wealth for low-income Americans. Most wealth in this country has come via home ownership, and from owning small businesses. Capital to purchase a home was historically limited to White Americans due to decades of bank red lining. Capital for small businesses remains difficult to access for women-owned businesses, and BIPOC-owned businesses. We invested in several companies such as Honeycomb Credit and CNote Inc. that help improve access to capital; we also invested in LoanSense Inc. to improve debt-to-income ratios for borrowers, so that they can qualify for home loans.

Within our FinTech focus, we continue to look at investment into startups that improve access to credit, and therefore to capital. We are also looking at improving retirement savings, both private and employer-sponsored plans.

Improving wealth and income for all Americans, especially those who have been marginalized in our economy, is also good business. When more Americans can thrive economically, there will be collectively more purchasing power, and greater GDP. Equally as important, when people have an improved sense of financial resilience and opportunity, their creativity can be unleashed. Imagine the innovation we could see in fighting our biggest challenges—like cancer or other diseases, climate change, clean water, and so much more—if hundreds of millions of our citizens felt empowered rather than disenfranchised. We could create a virtuous cycle.

Morally and economically, a case for altruism, for the concern of the welfare of others, makes sense. This is the future I am fighting for.