Capital Investment, Finance, Inspiration, J.E.D.I.


RSF Social Finance: JEDI In Action

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“There’s so much systemic racism in the finance world. People don’t even realize it, but it’s part of the system. We’re excited about providing ways to break through these systemic issues that we see throughout the financial sector.”

 

In our JEDI In Action series, we profile local companies to learn about their commitments to integrate Justice, Equity, Diversity, and Inclusion (JEDI) into the fabric of their company. Keep reading to learn about how RSF Social Finance practices intentionality in their JEDI practices, internally and externally.


I’m Jasper Van Brakel. I’m the CEO of RSF Social Finance in San Francisco.

 

RSF is a financial intermediary. We fund the change makers. On the one hand, we work with investors and our loan fund, and on the other hand, we fund natural products companies, schools, as well as climate change organizations, so that they can do their work as change makers. We really define our role as activating money towards change, working towards social and environmental betterment.

 

The organization was founded in 1984. We’ve been around for 37 years now. I’m just really proud of our track record of working with hundreds of borrowers and thousands of investors in our fund, and also providing philanthropic services to donor advised fund account holders. Throughout this entire time, we’ve had social justice and racial justice as part of our DNA, but we’ve definitely accelerated that work in the past few years.

 

One really important aspect of that was bringing more diversity to our team, to our staff, to our board. We’ve gone through a really conscious effort over the past couple years to significantly increase the diversity of experience, of life experience, racial diversity, and gender diversity.

 

“Who are we? Who’s in the room when decisions are made? How are we supporting our BIPOC colleagues to grow professionally within the organization?”

 

Jasper Van Brakel, CEO of RSF Finance.

When talking about JEDI, for us it’s really an internal as well as an external aspect. The internal aspect is: who are we? Who’s in the room when decisions are made? How are we supporting our BIPOC colleagues to grow professionally within the organization? What’s the makeup of the board—who’s in the room, who’s making the decisions? About a third of our staff members identify as people of color, and that’s really important to us. On our executive team, 60% identify as female and 40% are people of color. On the board of trustees, 56% are women and 50% are people of color. This is the result of the last year of really intensifying that focus. As you can see, we are a white male led organization, so I really consciously seek out people around me that have a different perspective.

 

“We are a white male led organization, so I really consciously seek out people around me that have a different perspective.”

 

The external part is: who do we work with? Who do we fund? How are funding decisions made? The racial justice collaborative [launched last year] is a small fund of philanthropic capital that we’ve raised and are in the process of raising. Because it’s philanthropic capital, it doesn’t have to be returned to the investors. It can be used in a much more flexible way to fund BIPOC entrepreneurs and social enterprises in traditionally marginalized and underfunded communities. What’s really unique about this collaborative is that we’re working with outside advisors, recognizing that we’re somewhere on the learning curve. We’re learning from experts in the field, getting closer to those communities that we’re trying to support, really learning from those advisors who are much closer to the types of things that we’re trying to fund. It’s also a way to organize accountability—are we doing what we say we’re going to do with this fund?

 

“Because it’s philanthropic capital, [the money from our racial justice collaborative] doesn’t have to be returned to the investors. It can be used in a much more flexible way to fund BIPOC entrepreneurs and social enterprises in traditionally marginalized and underfunded communities.”

 

In terms of size, I want to be really honest and transparent, it’s a relatively small fund if you look at the total activities of what RSF does. But it’s important for us and for our team to learn from the experience that we gather there, to apply those [skills] to our larger social investment fund, out of which we do most of our lending, including our lending to natural products companies.

 

We’ve done a handful of transactions out of the racial justice collaborative since its inception last year. If I look at the larger social investment fund, a significant portion of our loans is to what we call “organizations that are active in food and agriculture,” which includes natural products. It’s probably about a third—a little more than a third at this point—of loans that are made to that vertical. This varies from companies like All Good, Lotus Foods, and Guayakí, to smaller ones and nonprofits that are lesser known. We’ve also slowly ventured into hospitality, to figure out how we can support the restaurant industry when it comes to natural, healthy food.

 

For us the JEDI lens is a cross-cutting lens. We don’t see it as a vertical. We have three verticals—Education in the Arts, Food and Agriculture, and Climate and the Environment—and we look at increasing the percentage of BIPOC entrepreneurs that we support across those three categories. We’re also looking to grow the number and the percentage of social enterprises that serve underserved communities within those three verticals.

 

“The JEDI lens is a cross cutting lens.”

 

One example is a not-for-profit in the LA region that was looking to purchase a shopping center—Downtown Crenshaw is the name of the project—that we were able to support with the racial justice collaborative. And that’s part of a much larger funding initiative, so we definitely don’t want to take credit for that. And in general, RSF is not an organization that wants to take credit for the impact that our borrowers have. That’s their impact. We’re just providing some funding, some connections, and networking. The impact, in this case, is community wealth building. It’s getting a significant center in a part of this city in the hands of the community, so that it can serve the community rather than go to an anonymous project developer that might have very different plans with it. 

Another example is a natural products company that in this case is female-led, owned, and founded, that over the course of the pandemic, got into quite some supply chain issues and needed an increase to their loan. We were able to provide them with the increase that they needed in a very short time period, so that they could continue to operate their business and do the important work that they do.

 

So those are the kind of impacts that we’re looking at. It’s from workforce development, to education, to community wealth building, to food and agriculture.

 

We’re super excited about really integrating JEDI efforts in everything that we do, so that it’s not a standalone, it’s not a separate department. We’re super excited about increasing the percentage of borrowers of color within our entire portfolio from where it is today. We’re super excited about really delving into the questions about money and power, you know, the power dynamic that money often comes with, to create examples of how to work with money in a different way—a community and stakeholder-oriented way, rather than an extractive way of working with money. There’s so much systemic racism in the finance world. People don’t even realize it, but it’s part of the system. So we’re super excited not only about the entrepreneurs that we are able to and want to be able to fund in the future, but also about providing ways to break through these systemic issues that we see throughout the financial sector.

 

We are looking to fund an increasingly diverse population of social entrepreneurs. We’d love to get in contact with social entrepreneurs and social enterprises who are looking to find a values-aligned lender. We’re increasingly finding that they’re saying “we care who our lender is and we want to understand where our money is coming from and what kind of intention it’s coming with.”

 

Sound like you? Get in contact with RSF about supporting your organization at info@rsfsocialfinance.org.


Interested in sharing your J.E.D.I. journey? Reach out to our team at jedi@naturallybayarea.org.

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