Corporate Responsibility for Closing the Wealth Gap

corporations have a responsibility. Here the blueprint presented by Northwestern Mutual Misfireside Discussion will delve into the critical role of corporate responsibility and addressing the wealth gap through real time examples of how Northwestern Mutual is doing it. Especially they have this SARE task Force, which is a sustained action for Racial Equity task Force, or they're putting people whose jobs it is to make sure this thing happen happens

in collaborations with global partners. These speakers will explore successful strategies, actionable frameworks, and best practices that companies can adopt to actively participate in closing the wealth gap, ultimately promoting economic equity,

financial literacy, and inclusive financial well being for all. So we're going to have this conversation with Abim Kola, who is vice president, chief audit executive and a member of the company's Enterprise Leadership Group and was appointed executive sponsor for the CEO led Sustained Action for Racial Equity initiative aimed at helping to close the racial wealth gap. And the moderator here today is Dennis Kale, co founder and CEO of Zert You and So Zert You So. And

he's also a Navy veteran. Any veterans in the building right now, any families of veterans, I like that, thank them and thank you guys for your service. He's an SMU Graduate Bank board member and award winning entrepreneur, including afro Tech Future fifty honoree this year Forbes Next one thousand, d CEO five hundred n Ey Entrepreneur of the Year winner. Welcome to the stage, moderator Dennis Kale and our panelist Abim Cola.

be talking about today. I saw a company that was so committed. The vision of the company is to eliminate financial anxiety from Americans in particularly. We know that undersilved communities, there's this gap within other SILF communities and I could see at that time twenty years ago when I was packing up from New York City, I'm moving to Wisconsin, Milwaukee, Wisconsin, that I was going to connect with a company that had a deep vision and mission around financial security fall.

And he came away really committed even more committed building on all the things that he had been doing, that we had been doing for years to really make sure that we have a program which I'm very proud of to be the executive sponsor today that is leading the charge.

And again I'm sure we'll get into the details, but high level, we created the Sustained Action for Racial Equity, a task force cheered by the CEO, and I say cheered by the CEO because in this day and age, there's nothing more important in my opinion, that leadership courage.

I was reading a little about Joon Sanders day and they talked about the audacity to be brave, and I am just so proud to work for a CEO who is so brave to be in a position like this myself to recognize that people are waiting for us to

take a step back an instead we're leaning forward. So I'm sure we're getting too a lot of the programmatic aspects of the things that I'm very proud of how we're leading and supporting black businesses, But just want to say that this commitment we've had is built on generations. But we're even more committed to make sure that we are reaching and touching lives, particularly in the underrepresented communities.

our success fee. So that's how we make money. And came up with this idea probably ten plus years ago because my sister and other family members would borrow money from me and I had limited success in getting that money back, and so my thought process was, how do I take the awkwardness out of this but also help make them more accountable. But the big issue I had was not really knowing that the money was being used

for the intended purpose. And so I give you that context because my background started and my career started in the Navy as a systems engineer sett an up shift to shore ship to ship communications. But prior to that, I grew up in very humble beginnings. I grew up

in low income public Housing and Monroe, Louisiana. We didn't have banks or credit unions or financial services companies in my neighborhood, but we had several liquor stores and pawn shops that would cast your check for thirty percent of whatever your check was. So even at seven years old, I knew that was bad math. And so you fast

forward walked outside the naval base after boot camp. There was a lot of payday lenders, etc. And so I say that to say me founding Zertu and starting this company is really mission driven, but it also goes go back to making sure that I was being intentional about finding investors like Northwestern Mutual that are aligned with our mission, because that is extremely critical and it's not ever about

just taking money from anyone. One of the first questions I ask any investor is what do you bring beyond the capital? I think that's important, and I think you have to have people around the cap table, around the table that are in it with you for the mission and understand that you can do good. You can do well by doing good. And so that's what ZRCHU sets

out to do. And I think it really starts with those early checks from investors and partners like Northwestern Mutual that are willing to take a risk on you and then understand that you're going to do everything you can not to make a liar out of them and make sure you have a strong ROI. And so for us, it's really about aligning yourself with the right partners early, because I do think that has a lot to do

with your success. And by the way, they've made several introductions from a corporate standpoint, so we can drive our revenue as well, and so there's so much more that they bring to the table. And that's what I encourage any founder of Color to seek out, is those investors that are aligned with you, that understand you, that understand the bridge that you're trying to build, because that's going

to drive your success. And so I take very little credit for the success we've had to date and give most of that to the support system that we have around us.

our vision. But we recently had another conversation with our CEO and where we landed is this is simply a growth strategy. It is good for business. It's more than just being altruistic. Investing in your communities, doing what you can to really enable black business is good for business. We want to grow, we want to be relevant, we want to be competitive. Marketplaces have a change in and if you stick with your old business model, you will never grow, you will not be relevant, and you will.

So we created a strategy and we make sure we allocate funds on par with every other corporate strategic initiative. And I was asked to be the executive sponsor, So I was given a portfolio, I was given the money allocated to be able to do that, and that gave everybody the confidence that this is not just some bite side but again that spoke to kind of the sustained

aspect of it. So getting into the exactly what we did, we recommended that we created we created a hundred million dollar impact investing fund.

to make sure we start creating an ecosystem. Why don't we create an accelerator, And we studied the Northwest Mutual Black Fund Accelerator as a complement of that, and we're in the process of graduating the thirtieth cohort sorry thirty members from the accelerator. It's a twelve week program. People coming to the program get one hundred thousand dollars, they get an executive mentor from Northwest Mutual and they graduate from the program and gone to get other funding sources.

As part of the Impact Investing Fund, we've also been partnering with local community development financial Institutions CDFIs in the local area to make sure that they are able to loan to make loans to local business because they have the expertise on the ground game. And then we decided that also we wanted to take a look at our supplied diversity program to make sure we come brought in that program.

make people trust us, particularly again underrepresented communities. So I share the strategic approach with you, and I know it's a little painstaking to go through all the initiatives, but they say, this was a very well thought out strategy that's resourced with specific initiatives and people aligned with those initiatives. And then we're beginning to measure proof points, and the proof points that are material, how do we know we actually make an impact. We want to make sure that

the businesses we're funding actually growing revenue. We want to count the number of people they're hiring because obviously they're creating jobs, and we want to for the accelerators the founders come in, we want to track sort of full on funding among many other ways of tracking actual, real impact.

one call to action. Let's be bold, let's be audacious. Obviously we have to think constructed and make sure it's grounded in the business. So that's number one. Number two is it's beyond just activity. Even though I mentioned a number of things that are very positive. I talked about how we want to measure progress at the end of the actual impact you're making, and let's make sure that the programs we're doing actually tailored to deliver actual impact and not just activity.

to my tried and true ways or traditional ways. The third call to action here is for you know some of us are from corporations, but within your vantage point, within your power, construct find ways to determine the kind of impact you can make, what door you can open. Even if you're an entrepreneur, you probably have a network

that you can expose other entrepreneurs too. And I'm sure you have thoughts around this, Dennis, but it's a universal call to action for us or to believe that as a as a community, we're much better off if we uplift one another.

VC standpoint, and from an entrepreneurial standpoint. I'm sure you've experienced a little flavor between all those three, what advice would you have from your unique vantage point given some of the challenges and nuances of experience for each one of those constituents.

think it's the wrong start. I think you know that conversation doesn't go far and those commitments are going to fall off fairly quickly. So that's what I'm encouraged by what you guys are doing at Northwestern Mutual in terms of understanding, you know, and vetting deals. Right. So when I'm talking with corporate investors and you guys know this, it's the same diligence process as it would be if I'm talking to a VC. So for me, I approach it as if you know, it's the same common conversation.

But when I hear organizations sort of give me clues that you know they're viewing this as a nice sort of thing to do because it's the right thing to do in the moment, versus this being baked into their culture. I shy away from those corporate investors because I know they're not really committed to me, to investing in black founders and really helping us be successful. So that's one thing.

And I never got that impression with north with Northwestern Mutual, So I would I would say to corporations, organizations, bake it into your culture. Okay, make sure that founders of color and not underrepresented founders know that they have just as much of a shot as getting an investment, assuming they're button up, you know, and they can sort of demonstrate demonstrate the ROI from there. Vcs are very very different.

They're different animal corporations. From a corporate venture standpoint, that's not your core business. So you kind of have that luxury of sort of not living and dying off of these investments, but yet you approach it like it's a true investment. And I think this is important for founders in this room to understand how the vcs think. I have.

I had two term sheets earlier in the year. I'll give you an example that I turned down from VCS because I felt like there was a lot of overreach in those term sheets and felt like they were just sort of taking advantage of the market and you know where we are collectively, and that's hard to do, as any one of you in this room will know, that's hard to do in this this market. You know, when you're burning through capital, you have a certain number of months in runway and all that. But I did it

because it was the right thing to do. But I also knew I had other investors around the cap table that I can go to and say, look, I'm not feeling this deal. I don't like it. I don't think it's good for the company long term. And we had a couple investors, including Northwestern Mutual, that stepped up and led and co led this recent round of funding our

Series A that we've done. So that's a that's you know, this is a real time example of making sure you have the right investors on your cap table early because you're going to need them later, right, And so sort of looking at it from a what would I recommend to corporate venture as well as founders, And I think from a founder standpoint, as well as vcs. If I'm giving any founder in the room advice. When you're talking

with vcs, I typically like to give them permission. And this may be counterintuitive, but I give them permission early on to say no. Now. The reason I do that is because I need them to I need to have an objective conversation with them, and I need them to be able to actually hear my pitch right, because a lot of times these vcs feel like they're under pressure because you're a black founder and oh, you know it,

maybe taking the wrong way if I say no to them. No, first thing I say to them is, look, you know I'm viewing this first call. It's just an introduction call. You know. Whether it goes anywhere or not, that's okay. You know this is you and I getting to know

each other. And I think more of us need to look at these investor conversations like dating, right, And I always compare talking to investors as if I'm dating because and what you don't want to do is ask an investor to marry you on the first date, right now. True story. I actually wanted to ask my wife to marry me on our first date, but I knew she would have run away, right, you know, and that would have been a bad thing for both of us. But so I had to get to know her.

the game works. I'm just talking about how psychology work and how people are. You know, meet people where they are because at the end of the day, investors, especially venture capital investors, and what I've learned is two things that's important to them. They don't want to be embarrassed by making a bad investment, and they always want to

look smart by making great investments. Right, So understand that psyche going in and just kind of humble yourself and say, let's just have a conversation and get to know each other and never go into an investor deal. Thinking I need you guys to invest in the next two to three weeks. Not going to happen. I started relationships with Northwestern Mutual about a year before they actually made an investment, and that's likely true for most of our investors now.

So give yourself time, give yourself enough runway to make the right decisions. Don't marry the first investor you meet.

that VC in. I was actually hell bent on not taking any money from venture capital as part of our Series A, because I really want to show other founders that there's a different path to get where you're going, right, And so many times we put so much dependency on venture capital, which, look, we need venture capital, but at the end of the day, they're still only investing one percent into black founders, right, So that's just a data point we can't ignore. So we need to get creative

and start thinking outside of the box. And corporate partners are just stepping up more and more, but you have to deliver too at the end of the day. So it's about seventy thirty.

a sponsor or someone to mentor you. Where would you suggest people go for those kind of interactions build obviously like networks like this, you can build, you can build relationships, but like, are there programs or are there certain avenues you suggest new or young entrepreneurs to spaces.

alluding to, right, because that's what we want. We want those resources, we want those introductions, We want the opportunity to be in the room to at least make our business case right. And some people are going to say no, some are going to say yes, please get us in the room.