Where Is Rockefeller’s Support for BIPOC-Owned Businesses Headed?

When the Rockefeller Foundation rolled out its $65 million Equity and Opportunity Initiative a year ago, life in the United States looked very different. The nation was still in the midst of a decade-long economic expansion, and pandemic-driven lockdowns had yet to decimate entire sectors and render millions jobless. But Rockefeller’s new program acknowledged what personal experience had already taught millions of Americans: that the supposed economic recovery had been stupendously uneven, enriching the wealthy while consigning vast sections of the workforce to poverty wages.

Rajiv Shah, Rockefeller’s president, wasn’t afraid at the time to call out what was readily apparent in the data—that rosy employment figures don’t paint a full picture. The U.S., he said in a Chronicle of Philanthropy interview, “has taken a very large percentage of its own population and really suffocated their sense of hope and optimism around their economic and community prospects going forward.”

COVID-19 erased those rosy employment numbers and made it brutally clear that the economy favors some and penalizes others along lines of race, wealth, gender and a host of other factors. Many are acknowledging that in the pandemic and post-pandemic eras, good philanthropy must be targeted philanthropy, designed to empower people who’ve been structurally disadvantaged.

That’s the overall goal of the Rockefeller Opportunity Collective (ROC), an initiative the foundation debuted under its larger Equity and Economic Opportunity umbrella in June 2020. The timing was propitious. The ROC initiative, a place-based effort to decrease the wealth gap by eliminating barriers faced by Black and Latinx-owned small businesses, came just as racial justice protestors hit the streets in the largest mass protest movement of our time.

Since the program’s launch, Rockefeller has made some modest expansions to ROC, which is now a $15 million project operating in 12 locations. While it’s not the largest or sexiest of foundation initiatives, the program offers one window into how a bellwether legacy foundation is seeking economic equity in the U.S.—even though its economic development focus has traditionally been abroad. Here’s how ROC has evolved since its inception and where it sits next to Rockefeller’s larger funding goals.

Lowering BIPOC business barriers

Like Rockefeller’s 100 Resilient Cities initiative of yesteryear, ROC is a vote of confidence in place-based philanthropic funding. It’s also a vote of confidence in an ecosystem of capacity-building shops, incubators and networks operating on the local level to support BIPOC-owned small businesses (Rockefeller defines “small” as fewer than 250 employees and less than $2 million in annual receipts).

When it first started, ROC allocated $10 million over several years to a “collective” of sector-spanning partners in 10 locations. The idea was to guard against economic displacement and lower the barriers to capital and credit for small businesses owned by BIPOC people and women. The initial slate of ROC locations included the following places: Atlanta, Boston, Chicago, El Paso (TX), Miami Dade County, Houston, Louisville (KY), Newark (NJ), Norfolk (VA) and Oakland (CA).

According to Otis Rolley, senior vice president of the U.S. Equity and Economic Opportunity Initiative at Rockefeller, the foundation launched dozens of programs to spur investment in low-income communities over the course of 2020, particularly in communities of color. “In response to the magnitude of the COVID-19 pandemic and economic crisis facing workers of color, we expanded the Rockefeller Opportunity Collective twice,” Rolley said.

Those expansions have been fairly modest so far—a $10 million commitment to 10 cities grew by the beginning of this month to $15 million across 12 cities. But Rolley said the larger Equity and Economic Opportunity program is set to keep growing in 2021, and that the team is “exploring every possible way dollars and programs can have the most impact on families, small business owners and low-income communities.” In addition to those already mentioned, Jackson, Mississippi, and Baltimore, Maryland, are now on the ROC roster.

According to Rolley, the 12 ROC places were chosen “based on existing need for assistance, local partnerships and the potential to be catalytic, with the goal of eliminating barriers to access capital and credit among low-wage workers and small businesses operated by women, Black and Latinx owners.” One goal of the ROC program is to “catalyze $120 million in additional capital” for BIPOC-owned businesses by the year 2025.

Place-based opportunities

So what kinds of nonprofits are getting this money? Recipients include a fairly diverse set of technical assistance providers and social equity-oriented lenders, most of which operate in specific localities. One grantee, Our Village United, got $500,000 to provide technical assistance to Black-owned businesses in Atlanta. Another, the Florida-based Black Business Investment Fund, got $400,000 for its Contractor Assistance Program. The aim there is to grow the capacity of Black commercial construction contractors in Miami-Dade County.

Some ROC grantees cover a wider range of geographies and services. A grant of $1 million went to Accelerate 500/1863 Ventures to support small companies affected by COVID by giving them access to technical assistance and capital. In this case, businesses must be majority-owned by minorities, but can be located in nearly any of the ROC geographies.

Among the first ROC grantees was Main Street Alliance, a small business advocacy network that says it has engaged over 30,000 businesses in 11 states. With $350,000, Rockefeller is supporting the organization’s two-year Entrepreneurship & Mobility Platform pilot, which will identify local policies affecting Black and Latino business owners and advocate for the elimination of structural barriers. Rockefeller’s grant supports this work in two cities: Newark, New Jersey, and Norfolk, Virginia.

ROC has also been open to signing onto existing philanthropic efforts like Together We Win (Juntos Ganamos) a campaign created by Hispanics in Philanthropy (HIP), Ureeka and the Flo Lab to support Black and Latino small and medium-sized businesses directly impacted by COVID. Nancy Santiago, a senior advisor at HIP and the co-founder of HIP’s PowerUp Fund, put it this way: “When we conceived ‘Together We Win’, we wanted to create more than a campaign—we wanted a movement, a seismic shift” to let businesses recover in the short term and prosper going forward. Prior to Rockefeller’s involvement, Together We Win had already secured support from Google.org.

Other ROC grantees include the East Bay Community Foundation, PolicyLink and the Russell Technology Business Incubator.

In addition to partnerships like these, Rolley said Rockefeller wants to catalyze both public and private-sector investment via the ROC program. While public-private partnerships in this case would mostly involve local governments, the foundation has sought to amplify the impact of at least one federal program through its larger Equity and Economic Opportunity work—Opportunity Zones.

Created under the Trump-era Investing in Opportunity Act, Opportunity Zones are meant to incentivize private development in low-income areas. When it debuted its $65 million Equity and Economic Opportunity initiative, Rockefeller positioned as a key pillar making Opportunity Zones work better, along with expanding the reach of federal tax credits. Although Rockefeller no longer prominently features Opportunity Zones funding on its website, the foundation’s work to drive growth in the zones continues.

“Since 2018, we have invested more than $6 million to equitably embed community voice and social impact into Opportunity Zones,” Rolley said. “Rockefeller Foundation grants and contracts… built a significant amount of city capacity, ensuring Opportunity Zones are equitably embedding community perspective into wealth-generating processes, preventing more profit-minded actors from setting an Opportunity Zone strategy.” Rolley described ROC as an effort that builds on the foundation’s existing Opportunity Zones support.

A time for boldness

Laudable though Rockefeller’s place-based equity work is, one can’t help but feel like these totals—$15 million for ROC, $6 million for Opportunity Zones, even $65 million for the entire Equity and Economic Opportunity initiative—are smallish for a foundation like this. Maybe it’s the times we’re living in. Last year, the foundation world and a whole host of individual donors brought significant new heft to their U.S. giving. Next to all that, pre-COVID commitments like Rockefeller’s $65 million and even Gates’ $158 million Economic Mobility and Opportunity program look a bit timid.

To be fair, both Rockefeller and Gates are global grantmakers whose U.S. opportunity commitments aren’t their bread and butter. Gates’ economic mobility program is also only a bit more than double the size of Rockefeller’s, even though its endowment is larger by an order of magnitude. Also to Rockefeller’s credit, Shah and team have been unafraid to lean into bolder commitments in the pandemic era. Last fall, the foundation pledged $1 billion over three years to advance a “green and equitable” global recovery from COVID. That’ll almost certainly include at least some funds to ramp up the U.S. opportunity work.

Nevertheless, iconic U.S.-based global givers like Rockefeller and Gates now face a future in which American international leadership is by no means assured, one in which ongoing crises and evolving giving norms may pressure leading grantmakers not only to give more, but to give more in the United States. Need we mention sector-shaping newcomers like MacKenzie Scott, the majority of whose $6 billion 2020 giving spree went to domestic causes?

Rockefeller is a committed global funder—that won’t change anytime soon—but we’ll have to see how much further it’ll ramp up Equity and Economic Opportunity in the coming years. Besides the ROC funding, the foundation also announced over $7 million in grants last December to help Americans in hard-hit communities access the social safety net. That funding, which falls under the overall Equity and Economic Opportunity umbrella, includes contributions to prominent labor organizations like the National Domestic Workers Alliance, the National Employment Law Project and the 9to5 National Association of Working Women, as well as the Coalition on Human Needs.

Whether it’s to help small businesses or struggling workers, much more of this brand of funding will be needed as the nation confronts an uncertain post-pandemic future.

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