People-Powered, Locally-Led Capital Deployment

Boston Ujima Project

Boston, MA

The Practice

Boston Ujima Project is putting working- class communities of color at the center of decision-making in the Dorchester, Mattapan, and Roxbury neighborhoods. Ujima Project does this by helping to gather community members in public planning assemblies, at both the neighborhood and city-wide levels, where hundreds of residents work collectively to hammer out shared values and plans for their local economy.

One of the grassroots decisions community members make is where and how to invest capital in their neighborhoods. That’s where the Ujima Fund comes in. It’s a $5 million community investment fund that pools contributions (as small as five dollars) from neighbors, outside supporters, and foundations, and deploys it in the form of small business loans of $5,000 to $250,000 or as grants. An investment committee of Ujima grassroots partners, business owners, and local finance professionals uses the community-created plans to review investment opportunities, conduct due diligence, and make recommendations to members before all investments come to a member vote. (Each general member of Ujima that is also a Boston resident, selected via an application process and, regardless of whether or not they’ve invested in the fund, gets one vote.)

The Ujima Fund is designed to remain accountable to residents by consulting with them through ongoing assemblies.

In addition, an annual business review by
a member-elected Community Standards Committee ensures investments meet community-defined and community-ratified Good Business Standards (e.g., businesses that pay employees fair wages).

During a pilot of this process in August 2016, Ujima members voted to invest in loans to five local Black- or immigrant- owned businesses using the Kiva Investment Platform. Among them was a Cape Verdean wholesale market that received a loan to install additional refrigeration; Fresh Food Generation, a food truck that was able to make the move to a brick and mortar location; and Norma Rosario Catering (who has been the first to pay off their loan and will be celebrated soon by Ujima).

The first investment of the Ujima Fund, which has raised $2 million so far,
was approved in December 2019. The community voted to provide worker- owned Cero Cooperative, which collects businesses organic waste to create compost, with a $100,000 loan to support the hiring of a sales team and expand their market. A next round of investments is being considered now. Among them is CityFresh, a 100-person firm that makes healthy school lunches. CityFresh and the community are ironing out how the company can ensure fair, predictable scheduling of employees’ shifts. This is one of the community’s standards for investment, but how it should be applied to food businesses in a way that makes sense is being discussed.

The fund invests in:

• Microfinance (e.g., a loan for a small equipment purchase for a new worker- owned catering co-op);
• Working capital (e.g., inventory purchase for a new bike shop);
• Growth capital (e.g., loan for a new truck for an energy efficiency company);
• Real estate (e.g. acquisition financing for a local community land trust); and
• Community infrastructure (e.g., seed financing for community-owned internet infrastructure).

“Ujima provides technical assistance services and peer learning to help businesses become loan-ready. The two workstreams in UMA’s Pathways to Patient Capital program — Whole-Entrepreneur Capital Readiness and Financial Product Innovation — will help Ujima provide a longer-term, higher-touch solution to supporting entrepreneurs of color here in Boston,” says Nia Evans, director of Boston Ujima Project. “We believe that many of our businesses are ready for capital, which is why we are willing to provide it, filling in a gap left by traditional lenders. Our technical assistance and other additional supports are more oriented around exhibiting trust and faith—that many businesses owned by people of color don’t often receive—with our actions.”

Ujima is also in the process of launching a Business Alliance made up of community- oriented business owners, managers,
and entrepreneurs who are committed to advancing social and economic justice through the private sector. Business Alliance Members align their corporate practices with Ujima values by creating good jobs, sharing ownership and wealth, meeting local needs, and generating community benefits. Business Alliance Members are finding strength in unity, and value cooperation over the competition to achieve shared success. This will be familiar to anyone who knows UMA’s effort to create similar “Local Branding” organizations in efforts to sustainable mutual support networks for new and established business owners alike. “Participation in UMA’s cohort provides an important opportunity for Ujima to expand our network, learn from peers, and refine our strategies as we expand and scale our programs,” said Evans.

The Practitioner

Nia Evans

Boston Ujima Project

Nia Evans says her professional history is made up of three pillars: education, entrepreneurship, and policy. All of that stands over her foundational commitment to community — a foundation as firm as cement.

The entrepreneurial spirit runs in her family. Her dad was a business owner, and she followed that same path in college, where she studied industrial and labor relations and launched her own enterprise with her friends. “I believe a lot in experimentation and taking risks,” she said.

But it wasn’t until landing a gig working on economic development at the NAACP’s Boston Chapter that she started to contemplate ways they could involve residents in the big financial decisions that affect their communities.

“There was a common thread of frequent school budget cuts [in the community], and this would hit families by surprise. I started to wonder: how can communities be a part of these conversations as early as possible, and as equal participants?” said Evans.

Evans is now director at Boston Ujima Project, a financial organization that’s breaking new ground in community-led investment at both the national and local levels. In December 2018 it launched what it describes as the “first democratically governed capital fund” in the United States.

For that fund, some of its investors are working class residents of color in the Boston area, although it is also open to investors outside of Boston.

More impressive than the dollar amount is how Ujima brings community members in to guide the investment plans for that money. No matter how much money you put into the pot, members get an equal say in how it’s used.

Evans described Ujima as leading a “‘financial commons’ that serves the needs of people and planet over private profit.”

Ujima works with residents to create community standard awards for businesses that advance ethical practices. They’re also building relationships with economic anchors like hospitals, universities, and financial institutions so that Ujima- supported companies can have access to major purchasing contracts.

The pilot they launched in 2016 suggests their strategy is a winning one. They raised $10,000 from 175 community members in three days at their first local summit. After that, they picked up donations from local non-profits that brought their total up to another $20,000. From there, they identified five businesses to invest in, and sent out texts to community members to receive feedback on their investment plan for those businesses.

They’ve joined the UMA’s Pathways to Patient Capital cohort because they want to bring more urban manufacturers into their strategy. Boston is endowed with hard- working manufacturers in food production and other areas that Ujima’s products could lift.

“In the end, all of the businesses ended up getting financed, with zero percent interest loans,” remembers Evans, talking about their first five businesses. “That was the moment that it all clicked. Amongst all of the challenges we face, this was something where we created something concrete, and I could see that it was inspiring for the entire group [of local investors],” said Evans.

UMA has assembled our Pathways to Patient Capital practitioner cohort because each member has found a successful or promising approach to helping entrepreneurs of color — including makers and manufacturers — to get access to the capital and know-how they need to realize their business ideas and plans at scale. We know there is great benefit in lifting up and sharing this information among other practitioners, but also with other audiences, such as policymakers, lenders, and other funders. We compiled the brief profiles you are about to read to give these audiences a sense of both the personal and the practical: one section describes the people and organizations doing this work and the inspiration that guides them (“The Practitioner”); the other describes the innovations in capital access or readiness that each is pioneering or bringing to scale (“The Practice”). You can read the full report here