Pushing Boundaries in the Name of Racial Economic Justice
Association for Black Economic Power
MINNEAPOLIS, MN
The Practice
The Association for Black Economic Power (ABEP) in Minneapolis is calling out racial economic oppression for what it is — and centering the conversation of economic mobility as one of justice. As one very obvious example, to combat the proliferation of payday lenders on the northside of Minneapolis, ABEP piloted an alternative tool: $500 no-interest Liberation Loans, repayable over 12 months. It was a success and they plan to offer them again on a wider scale beginning this summer. In addition to being less expensive than payday loans, they help borrowers build or repair their credit.
“At the same time, we’re asking ourselves and our community what ‘paying it back’ even means,” says Samantha Lee Pree-Gonzalez, the new executive director of ABEP. “In the case of a zero-interest loan, we’re asking if borrowers can contribute in some other ways that add value to the community. For instance, if they own a business, can they host an intern?”
Pree-Gonzalez wants to push the boundary in thinking about what’s possible. ABEP should be a testing ground, she says, for trying new models of economic participation and wealth-building that traditional institutions are afraid to try to to invest in.
The organization is poised to launch a credit union in order to pool the savings power of the community and help un and under-banked folks. They are in the process of capitalizing the credit union, Village Financial, with an initial infusion of $500,000 from city government and a plan to raise $15 million over five to seven years from city philanthropies and local depositors. Village Financial will be both a way to keep cash in the community and a tool for innovating community capital and wealth-building opportunities. “We have purchased some county property to develop in cooperative housing,” Pree-Gonzalez says. “A lot of folks won’t have the buy-in funds for their share, so we’re developing a co-op loan that will allow them to participate with a very small initial contribution. That’s not something any other bank is going to do.”
Pree-Gonzalez says they’re also changing the narrative on deploying capital in the community, especially among businesses and entrepreneurs. She and her colleagues have succeeded in getting other lenders to share their underwriting approach so that ABEP can understand how the communities it’s lending in are being rated. “There’s lots of money and programming available for new or growing businesses,” she says. “But when we look at who benefits from the capital and the support, it’s not our communities at all. Everyone talks about how so-and-so is a risky borrower because of X, Y, or Z reason. We’re creating a risk assessment tool that flips how we’re currently doing it. It looks at communities that are most vulnerable and asks the question: What’s the risk if we don’t invest here, in this person, in this business? And now we’re putting pressure on them to use our tool to evaluate requests for capital.”
Pree-Gonzalez wants ABEP to continue pushing boundaries like these in Minneapolis. “We should be a testing ground for trying new models that folks are afraid to try, or to invest in,” she says.
The Practitioner
Samantha Lee Pree-Gonzalez
Association For Black Economic Power
Samantha Lee Pree-Gonzalez leads the Association for Black Economic Power, and their Village Financial Cooperative program, in Minneapolis, the first credit union focused on black economic liberation in the United States. The “financial” part of their title is key, but it’s the “cooperative” part that most attracts her.
“My career history has had nothing to do with money but it does have to do with helping people,” she said. “That’s been a passion as early as I could remember.”
Pree-Gonzalez served in Afghanistan as a combat medic. After that she pursued different careers in the healthcare industry before arriving at an inflection point.
“I started to realize how this job was participating in the disenfranchisement of the culture that I love,” said Pree-Gonzalez, regarding the United States’ infamously expensive health care system. “I didn’t feel like I was making any real contribution to the community I lived in.”
From there, Pree-Gonzalez got involved in politics, launching her own city council campaign and later working as an advisor to another city council member. She got wind of Village Financial Cooperative when they came to her council member’s office to ask for $500,000 in funding, which caught her attention (and her respect) for its boldness.
The city said yes, and since then Village Financial has attracted nearly $1 million in funding from philanthropic and government sources. After that intro Pree-Gonzalez started helping Village Financial build out their organizational structure. Staff shake ups happened along the way, and she was selected by the organization’s board to lead the cooperative.
Village Financial hasn’t officially opened yet for deposits or transactions, but they plan on targeting their financial products at black entrepreneurs and makers of all sizes in the Minneapolis area. They joined UMA’s Pathways to Patient Capital cohort to learn from national peers about how to best do that.
Their work is rooted in Ujamaa, the Kwanzaa concept of cooperative economic growth that prioritizes the community over individualism. That mindset has helped their office become a beacon for the community. Pree-Gonzalez often gets calls and drop-in visits from neighbors interested in volunteering or just sharing words of support.
She drops what she’s doing and listens to them every time. “The impact that we’re making is not going to be just the programming or access to loans — it’s the culture we’re creating and ingraining within the community,” said Pree-Gonzalez.
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.
