Engaging Hard to Reach Users in Designing Civic Tech

When St. Louis’ municipal court system came into the national spotlight in late 2014, our local Civic Tech and Data Collaborative—a partnership between Open Data STL, Rise, St. Louis County, GlobalHack and LaunchCode—saw an opportunity to bring data and technology to bear on the urgent problem.

After an initial round of surveying St. Louis residents and court clerks, our collaborative settled on a specific issue to address: reducing confusion for residents engaged in the court system due to non-violent offenses, such as traffic violations. Almost all court users we spoke with expressed confusion about the process, and several didn’t even know whether they were in the right place — an easy error in a county with over 80 municipal courts. Over the years, this system led to incredible numbers of unresolved warrants and oftentimes vicious cycles of fees and fines that disproportionately fall on poor residents and residents of color.

Over a weekend at GlobalHack and a year of further development, the team built YourSTLCourts.com, a website and text tool for individuals to easily access information about the courts and their outstanding tickets.

Like any software developers, we knew that a successful tool meets real needs of potential users and is easy to use. Thus, we needed to reach the residents who would benefit most from the solution, to test the tool and get feedback, and to promote its use. But our strategy needed to go beyond that of a typical new website to reach our audience — people who faced difficulty in resolving their court cases, due to both the complexity in navigating one or more courts and oftentimes the inability to hire an attorney. Because socioeconomic factors influence the ability and decision to hire an attorney, many of our users who were “going it alone” would likely be people of low- and moderate income and also disproportionately people of color, due to persistent racial economic disparities in St. Louis.

To identify whether our tool addressed the needs of these users, we originally intended to meet with some court users from the initial surveys and convene a Civic User Testing (CUT) Group, a model developed by Smart Chicago (now CityTech). However, the response from people we asked to come in for user testing was tepid and people without an active court case could only give a limited amount of input.

We needed current court users, and we had to go directly to the courts to find them.

We needed current court users, and we had to go directly to the courts to find them. So our team, with volunteers, spoke with people waiting in line outside the courthouse to be called into court. For those interested in talking (whether because they were excited to participate or simply to pass the time while waiting), our team prompted people to use their own mobile devices or a tablet we provided and use our live website to look up their court case information. We gave sample scenarios for them to walk through and asked questions based on Smart Chicago’s user-centered design methods.

The response was overwhelmingly positive and provided us with a lot of feedback. The experience highlighted ways that we could change the user interface for clarity, and surfaced unexpected questions and common challenges that we could address on our FAQ page. These were much-needed fixes that we were only able to obtain from people using the site with fresh eyes.

Surveying at court also has its limitations. Ultimately, the court sessions only gave us a few hours to gather responses. We also did not reach those who were not able to keep their court date or who may get a ticket in the future. Finally, many people who are attending night court simply wanted the experience to be over with as quickly as possible and were not in the mood to talk with us.

Our timelines, budget, personnel, and strategy went through multiple phases where our team had to say: “This isn’t working, what can we do better?”

To overcome these drawbacks going forward, we will be doing more direct community engagement, especially in municipalities and zip codes with a high concentration of unresolved tickets. We plan to familiarize more of our neighbors with the project so that, even if they don’t interact with the court system now, they’ll be aware of the tool if they ever need it in the future. We will deploy a host of strategies that are more community- than court-based, led by a our new community engagement specialist. This approach will complement our parallel track of engaging local government and the municipal court staff.

Having the agility to change our approach throughout this project was key to achieving our goals. Our timelines, budget, personnel, and strategy went through multiple phases where our team had to say: “This isn’t working, what can we do better?” Our various re-evaluation processes had us asking for help, working long hours, and discovering our own resiliency as we moved forward even at times when progress was met with setbacks. Doing so has resulted in stronger collaborations, a better product, and more honest feedback from St. Louisans. As other groups look to use civic tech to solve community challenges, mental flexibility and persistence will be required to make these products a success.


St. Louis was a participant city in the Civic Tech and Data Collaborative, which harnesses the power of technology and data to make local governments and civic organizations more effective in meeting the pressing challenges of the 21st century. Led by three national organizations – Code for America, Living Cities, and the National Neighborhood Indicators Partnership – the Collaborative was a two-year project providing grants and technical assistance to seven urban communities around the country to improve civic tech and data ecosystems. Funding for this collaborative was made possible with support and partnership from the John D. and Catherine T. MacArthur Foundation.

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New Impact Investing Strategy Puts Race Front and Center

Too often, race-neutral approaches fail to deliver results for low-income people of color in the US. The lack of race-informed efforts worsens racial gaps in jobs, income, and wealth and systematically ignores historical disparities. In this context, the Blended Catalyst Fund (BCF) has recently committed to a more defined impact focus: closing the racial wealth gap by supporting the development of jobs, income, and wealth for low income people of color. We are actively seeking new transactions; please reach out with opportunities (catalystfund@livingcities.org).

Living Cities manages two structured debt funds. The Blended Catalyst Fund (BCF) is the second fund, which is capitalized at $36.9 million. Two-thirds of the fund remains to be invested. BCF’s twelve investors include some of the world’s largest financial institutions and foundations.

BCF was created to support Living Cities’ evolving programmatic objectives, while also serving as a new collaborative model for the impact investing field. More specifically, BCF blends capital from different types of investors; seeks to be on the cusp of innovation that help addresses long-standing economic disparities; leverages capital from other sources through its investments; and is transparent about lessons learned.

The investment team, under new leadership and in the context of clearer impact parameters adopted by the Living Cities Board, has recently committed to a more defined impact focus for BCF around closing the racial wealth gap. Any new investments made out of BCF will incorporate this focus.

This more defined impact strategy is in keeping with Living Cities’ commitment to racial equity and inclusion, driven by the fact that racial disparities exist in most key indicators of well-being. Communities of color tend to lack access to good jobs, decent wages, quality education, and access to opportunity. Additionally, research shows that the population of disadvantaged individuals – children, families and communities – is overrepresented by people of color. Despite the best efforts and intentions of many institutions, organizations and individuals, substantial inequities persist. Therefore, Living Cities believes addressing race and racism must be squarely at the center of how we work.

We believe this more focused impact strategy has numerous benefits, for BCF, Living Cities, and the impact investing field more broadly. These include:

  • Stronger organizational alignment between BCF and the broader Living Cities platform.
    • Living Cities is more likely to achieve its impact goals when the investment team is working alongside the rest of the organization to support those goals.
    • Deal sourcing, diligence, and post-close investment management for BCF will be more effectively supported by the rest of the organization.
  • Closing the racial wealth gap is a unique impact focus in the impact investing market. Lessons learned from this investment strategy will provide additional value to BCF investors and the broader impact investing field.
  • This focus aligns our investment strategy more directly with people. This makes it is easier for us to understand how Living Cities is doing and to hold ourselves accountable.
  • We believe this is an impact strategy that can be implemented with little to no financial implications.

We are actively seeking new debt opportunities that fit this impact profile. Please reach out to us if you have a transaction we should consider (catalystfund@livingcities.org).

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#BensTake: What Can We Learn from Amazon HQ2?

Amazon recently announced the cities still in the running for the company’s second headquarters, setting off a new wave of frenzied speculation. Over 200 cities applied, and the list is down to 20. Only one will win. What then happens for the prospective cities still grappling with slow job creation and wage stagnation? Do they wait for the next RFP?

Cities are waiting for a knight in shining armor to solve their economic woes. This strategy is based on a popular “urban myth”: that a local economy can sustain itself and grow in the long-run by attracting established businesses away from other regions. On the contrary, research from the Kauffman Foundation has shown that recruiting companies—even providing incentives like tax breaks—doesn’t correlate with creation increasingly shows the importance and power of fully leveraging your existing assets–keeping “place” in the forefront as a tool for change.

We see the same dynamic with other gargantuan, subsidized investments like sports stadiums. Most economists agree that, in the long-run, these projects don’t translate into sustained economic growth. And they can worsen a city’s existing challenges, such as affordable housing. Mega projects like these can actually drive financial instability for many and massive displacement for low-income families and families of color, in particular.

And the opportunity costs are staggering. Most cities in the HQ2 running are offering Amazon economic incentives valued in the billions of dollars (offsetting a huge portion of the $5 billion investment). Those billions of dollars could be going to health initiatives, infrastructure investment, education and more—long-term investments that we know sustain the economic security of residents and can even help reverse long-standing racial disparities. Richard Florida and Amy Liu, among others, have already made this case convincingly.

That’s why, if HQ2 is to be a net positive wherever it lands, equity must be front and center. Without efforts to ensure that job creation is inclusive, such growth will undoubtedly replicate patterns of racial inequities, and widen income and wealth gaps. Amazon could lead the charge by putting pressure on cities to consider strategies for inclusivity in their pitches. As Brookings Fellows Andre Perry and Martha Ross aptly point out, “by targeting the factors of diversity and inclusion, Bezos can create a model for companies to follow that maximizes the talent that our changing racial demographics present.”

But if Bezos won’t, then it’s on the cities to take both historical inequities and today’s rapidly changing demographics into consideration as they prepare for HQ2. Rather than touting massive incentives, they should be competing to demonstrate that they are the best stewards of their residents’ tax dollars, and that means using all the resources in their own back yards to generate sustainable, inclusive economic growth.

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5 Lessons for Harnessing Data and Tech to Meet Community Needs

Putting the principle of designing solutions “with, not for” residents into practice can pose a challenge for those working with low-income communities to bridge economic and opportunity gaps. This is particularly true for civic tech and data experts seeking to leverage their distinct expertise to meet pressing community needs and address complex problems. Even after adopting a community-driven approach, making that commitment a reality can be challenging.

In our previous post, we reflected on our experiences as members of a public-private partnership in Seattle/King County. Here, we share five lessons we will carry into the next phase of their work. We hope our experience will help other cities looking to harness civic tech and data in a way that truly addresses community needs:

  1. Start with the problem, not the solution. From the start, we were committed to taking a community-driven approach to identifying a problem amenable to a civic-data-tech solution. But after months of leading with civic data and technology in our pitches to community-based organizations, it became clear that we were essentially offering a treatment, and then going to residents in search of symptoms. In our future work, we will strive to identify a high priority issue first, such as affordable housing, and then examine how data and tech might add value when developing solutions.
  2. Prioritize the community perspective. Projects have the greatest impact when they are built on authentic community values, respecting the diverse languages, educational backgrounds, and identities of those who live, work, and play there. Community voice should be integrated into as much of the project as possible – for example, by hiring or engaging community members in data collection, or by creating a community advisory board that has true oversight and control over the direction of the project.
  3. Build long-term, trusting relationships and commit to a continuing presence in the community. While this kind of relationship-building is ideal, our lean staffing model often forces us to rely on temporary student assistance. When students represent us in the field, we have found it important to assure communities that the relationship will endure beyond a student project. Similarly, community organizations have provided feedback that the impact of one-day “hackathons” is greater when tech developers continue their relationship with the community after the event, and are available to provide some kind of ongoing support. At a minimum, expectations about the length of engagement should be made clear at the beginning of a project.
  4. Offer multiple, structured opportunities to identify priorities, share perspectives about data, and bridge across sectors. Even in this digital age, it is important to build relationships face-to-face, especially when working with communities to reduce disparities. Our future work may include a series of in-person data walks or community cafés, within which neighbors can identify community concerns and discuss ways to address them. As discussions converge on specific issues and “civic data tech” solutions, we can invite relevant partners to join the project.
  5. Identify and nurture a data and technology champion within the community. Having someone with data expertise embedded as a staff member or committed volunteer in a community-based organization can strengthen the roles of data and tech in solving community problems. A good data champion can bridge gaps that might otherwise impede progress, and can advocate for the community in situations where the wealth and expertise of the tech world could create a power imbalance.

While every community is different, we believe these five lessons from Seattle/King County are a good start for anyone supporting collaborations between low-income communities and those who work in data and tech.


Seattle is a participating city in the Civic Tech and Data Collaborative, which harnesses the power of technology and data to make local governments and civic organizations more effective in meeting the pressing challenges of the 21st century. Led by three national organizations – Code for America, Living Cities, and the National Neighborhood Indicators Partnership – the Collaborative is a two-year project that provides grants and technical assistance to seven urban communities around the country to improve civic tech and data ecosystems. Funding for this collaborative was made possible with support and partnership from the John D. and Catherine T. MacArthur Foundation.

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Leveraging Data to Address Community Needs in King County

Driven in part by successes of our region’s innovative tech industry, Seattle leads the nation’s large cities in its rate of population growth. As real estate developers rush to accommodate the housing needs of skilled and highly-paid tech workers, low-income families are being displaced and homelessness has increased so dramatically that Seattle and King County formally declared a state of emergency.

Technology has profoundly altered our local culture and economy. But its powers have not been optimized to mend the growing divide between the “haves” and the “have nots.”

Faced with this paradox of prosperity, Communities Count, a public-private partnership, sought community-driven answers to the question, “How can we leverage tech and data to bridge the ever-widening economic and opportunity gaps in our communities?”

Read on for reflections from Louise Carter and Elaine Albertson, of Communities Count, on their efforts to lead with community needs in crafting a partnership with the tech community:

As data experts, why were you interested in bridging tech and data to benefit low-income residents?

It is absurd and shameful that King County, an iconic home to the transformative power of technology, harbors deepening disparities in health and wealth. We believe the data and analytic capacities of our community-based organizations and government agencies offer opportunities for synergy with our strong tech sector.

Technology has profoundly altered our local culture and economy. But its powers have not been optimized to mend the growing divide between the “haves” and the “have nots.”

For example, integrating King County’s population-level data (on close to 200 indicators) with data from our regional Homeless Management Information System (HMIS) could offer service providers, community-based organizations, and Public Health staff coordinated data that they could use to guide interventions and understand community conditions associated with homelessness. Joining HMIS demographic analyses of local homeless populations with general population data could anchor the HMIS data in a meaningful local context. Policymakers could immediately see, for example, that in 2015, while Blacks/African Americans represented 41% of people experiencing homelessness, they comprised only 6% of the general population.

Disparities

41%
King

We might then be able to drill down into the integrated data to uncover risk factors that would not show up in either data set alone. Integrating our data systems could surface opportunities for new approaches to stem the tide of homelessness and share our economic prosperity more broadly.

What did you learn through taking a community-driven approach to identifying a problem?

We are always wary of top-down solutions to complex problems. Members of OPEN Seattle, our local Code for America brigade, were eager to enlist our help on existing projects for significant public issues (for example, monitoring a toxic-waste clean-up or mapping areas underserved by transit routes), but we didn’t want to pre-empt the opportunity for residents of low-income neighborhoods to set their own course.

We decided to go to where we felt there was greatest need, and focused on a South King County community with a high poverty rate, poor health outcomes, and the lowest life expectancy in the county. Communities Count had not previously worked in this community, so we gathered names and introduced ourselves to librarians, health educators, city government officials, and staff of community-based organizations. We pitched the project at community meetings, initially asking about the “civic tech and data needs” of low-income residents. The question elicited enough blank stares and stammering “not-sure-what-you-mean” responses that we quickly shifted to language that was more easily understood.

By the time we fielded an informal survey – primarily by distributing it at meetings of community-based organizations and human services staff – we were asking about “the kinds of community information” useful to residents and service providers and how that information was typically accessed and shared.

While the survey offered useful guidance about ways to improve our existing data products and partnerships, it didn’t yield a clear directive for a new app or new civic data and tech partnership to improve the lives of low-income residents. In retrospect, our insistence that the community come up with a problem amenable to be solved by data and technology was akin to a doctor prescribing treatment for an illness before the patient has described the symptoms.

With that experience in mind, what will the next phase of your work look like?

We’re still committed to a community-driven approach, but now we’re starting conversations in places where we – or one of our partners – have established relationships. For one thing, having these relationships means we are starting from a basis of trust and don’t have to spend as much time convincing the community of our commitment to them. We will of course continue to forge new relationships in new communities, recognizing that that a coordinated, multi-sector effort will be needed to engage communities that are not already connected with government agencies or nonprofit organizations.

For example, through the Communities of Opportunity initiative, Public Health staff and members of the Communities Count steering committee have extensive experience in White Center (a neighborhood south of Seattle). A 2017 survey of residents by the White Center Community Development Association (CDA) identified access to affordable housing and supporting people experiencing homelessness as top priorities. With this data about residents’ self-identified needs as a launching point, we may be able to dive into problem-solving more quickly—rather than leading backwards from our solution (i.e. “a civic tech and data project”).

Communities Count is well-positioned to take on issues such as affordable housing – not alone, but as a data partner, a connector, and a catalyst for creative solutions. For example, one community-based organization requested assistance with data analysis because they couldn’t afford the appropriate software. We provided technical assistance, but we also reached out to local libraries to see if they might offer statistical software. One next step may be to host a community café where we invite neighbors and regional data and tech partners to share perspectives on housing and homelessness.

Now that you’ve honed in on an issue area, how will you identify the partners and resources to involve in addressing the problem?

As participants in the Civic Tech and Data Collaborative, we mapped the rich data and technology landscape in our region. This exercise helped us to see – and connect – many ways that community-based social services and housing-development organizations already use data strategically. For example, the Housing Development Consortium curates valuable data resources (administrative, government, and educational) to inform programs and policies. Local organizations – especially community development associations – engage with communities to collect primary data about housing and other topics, and use that data to organize and advocate for change. These efforts bring needed community voices to the decision-making table. Already, neighbors have shared their visions about crowd-sourcing, data-sharing, improved data infrastructure, and democratization of data.

We also want to tap national data resources, such as the National Housing Preservation database and innovative projects from other places, including the Housing Insights open-source affordable housing preservation tool from our CTDC counterparts in Washington, DC.

Economic inequality isn’t unique to King County; it’s increasing worldwide at a frightening rate. Nevertheless, there is reason for hope here. From Boeing to Microsoft and Amazon, our region’s brand of tech innovation developed and thrives in a context of deep compassion. King County neighbors consistently vote to tax themselves to support education, libraries, families, and children. Local philanthropies, civic leaders, and citizens are unified in their commitment to equity and social justice.

Every good idea – and every strong relationship – taps us into a deeper understanding of how community members, data experts, and technology partners, working together, can craft solutions to very difficult problems.


Seattle is a participating city in the Civic Tech and Data Collaborative, which harnesses the power of technology and data to make local governments and civic organizations more effective in meeting the pressing challenges of the 21st century. Led by three national organizations – Code for America, Living Cities, and the National Neighborhood Indicators Partnership – the Collaborative is a two-year project that provides grants and technical assistance to seven urban communities around the country to improve civic tech and data ecosystems. Funding for this collaborative was made possible with support and partnership from the John D. and Catherine T. MacArthur Foundation.

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How Albuquerque is Fighting Trickle-Down Economics

Albuquerque has been slow to recover from the Great Recession. Our unemployment levels have stayed out of step with the national trends, out-migration has left us with a negative population gain, and poverty levels threaten the economic and social fabric of our communities.

It became clear we needed to focus on job creation, but not only jobs in high-growth sectors. We also needed to focus on sustaining and creating jobs that provide a ladder of opportunity through main street businesses and microenterprises which are an essential part of our local economy and part of the diversity of assets in the community.

Through coordinated shifts in education, financial, business, government and nonprofit institutions, City Alive, which is a part of Living Cities Integration Initiative, is contributing to an ecosystem in Albuquerque that supports homegrown entrepreneurs from diverse backgrounds at all stages of their growth.

Our Leadership Partners, who comprise 20 key institutions and organizations across Albuquerque, share an ability to reallocate resources and change systems in alignment with the shared vision of job creation, racial and income equity through innovation and entrepreneurship. Together, these bright and dedicated leaders have set a course to address our toughest economic challenges.

Barriers to Entrepreneurs

Starting a business is not easy for anyone, but it’s even more difficult for low-income people, and still harder yet for entrepreneurs of color. We have worked over the past three years to understand how we better connect systems, remove barriers, and lift up first-generation Americans, people of color, families in poverty and immigrants.

We spoke to over 150 entrepreneurs from diverse backgrounds and communities and found out that they face significant challenges:

  • Business owners are 1.69 times more likely to be white than people of color, well above the national average, which is unacceptable in New Mexico, a state in which people of color are the majority.
  • Many immigrant business owners do not identify as entrepreneurs and are unaware of resources targeted to entrepreneurs. Many communities lack trust in institutions and government.
  • Financing is challenging as many low-income and minority adults lack collateral like a home or good credit, and don’t have bank accounts or personal savings.
  • Race- and gender-based bias exists in credit and venture capital markets.
  • Many have limited access to public transportation, childcare, tax prep, marketing, or advertising.

Knowing what was holding our city’s potential entrepreneurs back, we set out to reconstruct the systems that were stacked against them. First order of business: jobs and access.

We

Did
It

If Albuquerque businesses add jobs into our community, we step in to ask: “Wait…who is getting access to these jobs?”
Our approach is based on changing systems to better support our economic future while addressing the racial inequities and historical marginalization that exist within them. That means working from the bottom up, not from the top down. Here are the areas where we are focusing:

Streamline processes

We must remove the red tape at City Hall, remove barriers to capital access, and allow new ways of financing projects and entrepreneurs. We are streamlining processes for entrepreneurs through programs like TrepConnect, Co-Op Capital (an alternative lending model) and integrated workforce development.

Help connect entrepreneurs with support

City Alive acts as the “hub organization” that finds gaps and strengths within our entrepreneurial ecosystem and provides shared functionality, building services, and solutions that add capacity, increase integration, and meet people where they are. Programs like our navigator programs are being piloted to meet this need.

Lead systems change in the public sector

Our public sector in Albuquerque purchases over $1.5 billion in goods and services each year. Over the last year, Albuquerque anchor institutions have been drilling down into where public dollars are spent and how changes in their spending can better support locally-owned businesses to impact Albuquerque’s economy, adding jobs and increasing wages. In addition, the City of Albuquerque is partnering with the Albuquerque Hispano Chamber of Commerce and City Alive to implement new systems that encourage purchasing from historically disadvantaged business owners.

Ensure linguistically and culturally appropriate assistance

Through City Alive partners, new and existing programs that focus on immigrant and Spanish-speaking entrepreneurs increase access to business development, training, and capital opportunities. The Albuquerque Hispano Chamber of Commerce’s Emprendedores program and the South Valley Economic Development Center’s TAZA are excellent examples of partner programs supporting Spanish-speaking entrepreneurs.

Provide more access to capital

Many people face barrier after barrier in securing capital to start or expand businesses that are the lifeblood of their families. We have to consider our capital models and who is accessing funds to start, scale and sustain businesses. Co-Op Capital is a pilot project that is changing lending policies to rely on community-based institutions and relationships. For those who are being turned down for loans by everyone, even alternative lenders (which are unable to lend without pulling credit reports and requiring collateral), Co-Op Capital provides a new path to small business loans.

Example

Innovation
District

Government officials announced the new infrastructure project and excitedly claimed that it would spur economic development and bring vibrancy to the neighborhood. This neighborhood is home to many immigrants and people of color. By most accounts, it’s already a vibrant place. We wanted to be intentional about how this “innovation district” could be accessible to microenterprises and solo entrepreneurs. We know not all high-level economic development trickles down to prosperity for low-income people.
Here’s how the new Innovation District is a hub for collaboration and creation:

  • It supports start-up success through the co-location of incubators, accelerators, free classes, and workshops.
  • It creates shared workspace and maker spaces accessible to the community at large.
  • It will offer multi-lingual programming.
  • It offers direct accessibility by public transit, even from the far reaches of the city.
  • It offers directed education pathway programs like the innovationAcademy and 2+1+2 to increase access to educational opportunities.

In addition, by deploying government funding through capital outlay on infrastructure projects in the Innovation District (installing fiber cable along our central corridor) and public transportation (Albuquerque’s recently launched Bus Rapid Transit), the accessibility of the space is further increased.

Each of these efforts is a piece of the larger puzzle, creating the support network necessary to meet entrepreneurs where they are and give them what they need to grow a business.

Impact

and
Impact

  • In 2017, the first two quarters were the strongest for number of new business registrations in Albuquerque since 2012 with more than 1,400 registrations each quarter.
  • Quarterly business registrations have also had their highest year-over-year growth in 2017 with the first quarter up 19.5 percent and the 2nd quarter up 18.3 percent over 2016 numbers.
  • We are over 60 percent of the way toward our goal of increasing the median weekly wage to $932 per month.
  • Albuquerque has seen 48 months of consecutive job growth. In January of 2014, Albuquerque had 371,100 jobs. As of October, 2017 we have 396,200. Those 25,100 more jobs are nearly a 6.8 percent increase in jobs over that time period.
  • City Alive’s work has been recognized nationally, receiving the 2017 Housing and Urban Development Secretary’s Award for Public-Philanthropic Partnerships.
  • The City of Albuquerque was named as the top-ranking Resident-Involved City by Governing magazine and Living Cities.

By integrating support, City Alive and its many partners have been able to build an ecosystem that is changing the meaning of economic development as we know it. We need to permanently integrate the words “inclusive” and “equitable” into the very framework of economic development. We are connecting agencies serving low-income people, communities of color, and immigrant populations with those serving entrepreneurs. Together, we are developing support systems that will generate success from the ground up.

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Propeller Social Venture Fund: Building an Inclusive Entrepreneurial Ecosystem in New Orleans

Working Towards a More Equitable City

Since 2009, Propeller: A Force for Social Innovation has worked to grow and support entrepreneurs tackling our city’s most pressing social and environmental disparities. We believe that social entrepreneurship has the power to correct for and tackle systemic issues – the deeply ingrained inequities that disproportionately impact populations of color. By building a critical mass of social entrepreneurs to solve those problems in four core issue areas- healthcare, food security, education and water – we work to create a more equitable society free of racism, poverty, and other systems of oppression.

Propeller’s Accelerator programs have launched 145 small businesses and nonprofits working to increase equitable outcomes for New Orleanians in food, water, health, and education. Together, Propeller graduates have generated over $85 million in revenue and financing and created over 350 jobs for New Orleanians.

created

in
New

However, through the years, even some of our highest-impact ventures encounter the same challenge uniformly faced by startup founders: early-stage businesses have long been considered too high-risk to be considered for traditional sources of loans and credit. This problem is compounded for founders of color.

The Problem: Lack of Financing for Emerging Small Businesses & Non-Profits Owned By Entrepreneurs of Color

Though New Orleans has experienced an entrepreneurial renaissance post-Hurricane Katrina, with start-up rates eclipsing the national rate by 56%, the boom has not been equitably enjoyed by New Orleanians of all races.

The founders of successfully financed startups in New Orleans do not reflect the diversity of the city, whether you look at demographic and socioeconomic characteristics, educational achievement or professional backgrounds. Racial inequities are particularly alarming: while people of color represent over 60% of the population citywide, they only own 27% of all firms, and for the past twenty years, their businesses have persistently received less than 2% of all receipts.

owned

0%
people

Emerging small businesses owned by people of color have particularly struggled to acquire loans from traditional banks. Surveys completed for the Data Center’s New Orleans Index at 10, show that MBEs (Minority Business Enterprises, or businesses with 50% or more ownership by a person of color) in New Orleans feel disconnected from the resources that have emerged to support entrepreneurs and that they are either unaware or excluded from the majority of available resources.

Why are small business owners of color struggling at rates so disparate from their white counterparts? We see two primary drivers behind this inequity. First, the reality is that small businesses with less than two years of financial track records typically lack the qualifications to be considered for loans from regional or national banks. Second, the racial wealth gap makes it more difficult for founders of color to bootstrap, access large investments from friends and family, and tap into high-wealth, influential networks. Relative to white entrepreneurs, Black founders rely more on family and friends than external loans or equity, but experience lower rates of household wealth. Lower levels of wealth also innately limit a Black entrepreneur’s ability to acquire credit and loans. A 2015 Kauffman Foundation study that controlled for business and owner characteristics found Black-owned businesses are three times as likely to be denied loans than white-owned businesses, and those who are approved receive lower loan amounts at higher interest rates.

The Solution: Innovative Financing to Create Social Impact

The issues business owners of color face will not resolve themselves, and equity will not emerge through the normal course of business growth. New, accessible sources of capital are crucial to the survival and growth of the New Orleans entrepreneurial community, especially if we are to activate the largely untapped potential of our city’s entrepreneurs of color. We believe that together we are uniquely positioned to fill this capital gap for early-stage entrepreneurs of color based on the experience and relationships we’ve built through our Accelerator programs, which is why we’re thrilled about the launch of our Social Venture Fund today.

Since 2008, the Foundation for Louisiana has provided loans to socially conscious ventures as a part of their mission to invest in people and practices that work to reduce vulnerability and build stronger, more sustainable communities statewide. Through their Community Investment Fund, the Foundation partners with organization like Propeller seeking to offer loan products to their clients while helping to build more community assets.

Together with the support of lead investor Living Cities, alongside other investors Reinvestment Fund, The blue moon fund, and Ella West Freeman Foundation, the $1 million fund will provide loans and technical assistance to New Orleans businesses and nonprofits seeking to grow their capacity to tackle critical disparities in the water, food security, education and health sectors. The Social Venture Fund will also provide loans and technical support to entrepreneurs of color establishing or operating brick-and-mortar businesses along the South Broad commercial corridor.

The Social Venture Fund is structured to meet the needs of local for-profit and nonprofit ventures, The fund will make below-market rate loans between $20,000 to $100,000 with terms that stretch between 2-7 years.

Ultimately, through the technical assistance and provision of growth capital provided through the Social Venture Fund, we hope to better prepare entrepreneurs and emerging businesses to graduate into the formal banking system.

Learn more or apply to the Propeller Social Venture Fund by visiting us at GoPropeller.org/funding/Social-Venture-Fund.

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The Town Kitchen Q&A: Lunch with a Purpose

Across the nation, there are approximately 3 million American youth aged 16 to 24 who are neither in school nor working. These 3 million youth are disproportionately young men and women of color. A Brookings Institution study finds that in some places, young blacks and Latinos are up to 3 to 6 times more likely to be disconnected from the economy than young whites – and concludes that a young person’s success in the labor market today is largely shaped by place, race and education.

That means the deck is stacked against young people of color, especially those from low-income neighborhoods, who are often confronting the effects of living in concentrated poverty, experiencing discrimination and facing barriers to obtaining a high-quality education. So how can you level the playing field for these young people and give them a chance to realize their full potential?

One trend the Catalyst Funds team has been tracking is the rise of urban-serving businesses, which we think could represent a potential new model for social change. Through our investments in venture capital (VC) funds like Urban Innovation Fund, we’ve sought to learn more about how social enterprises can impact low-income people and create jobs, especially for people of color.

The Town Kitchen (TTK), an Urban Innovation Fund portfolio company, is seeking to even the playing field for young people of color, especially those from low-income neighborhoods, by serving “lunch with a purpose.” TTK is an industrial catering company that services corporate customers and employs urban youth. By providing youth ages 15 to 25 with entrepreneurial training, college course credit, and fair-wage employment, TTK is creating a pathway to upward economic mobility for young people so they can live, work, and build futures in their native cities.

Since launching in January 2015, TTK has grown from just four people working in a small kitchen to a staff of 22 people, and has delivered over 145,000 lunches to 700+ corporate clients including UC Berkeley, Schoolzilla and the Golden State Warriors. This exceptional growth has not gone unnoticed: TTK’s work has been recognized by Inc., Entrepreneur Magazine, Fast Company, and Sunset Magazine.

I recently connected with Sabrina Mutukisna, the co-founder & CEO of TTK, and had a chance to ask her a few questions about TTK and her experience in starting up a company.

What inspired you to start TTK?

I was raised in my parents’ drycleaner and grew up working all sorts of entry-level jobs. While I always knew the value of a college degree, by the time I attended UC Berkeley, I realized that navigating the education system was challenging – especially if your parents don’t have a college degree. I became passionate about supporting young people in higher education and creating pathways towards upward economic mobility. For young people in low-income communities, this begins with the stability of having a great job, like The Town Kitchen, coupled with mentorship and access to resources, such as opportunities for higher education. 90% of TTK employees, for example, are enrolled in college classes.

Breakdown

47%
TTK

What does a typical day look like for one of the young people employed by TTK?

Each day really varies. Most of our youth employees work in the kitchen and begin their days around 7am. For those employees, 7am-11am is all about the hustle. We have to plate, pack and load hundreds of meals in under four hours. Some of our youth staff join our delivery drivers and serve our clients on-site while the rest of the kitchen crew prep for the next day’s service. We also have a few youth employees that work in sales and accounting – their days start around 8am where they’re working from a laptop or taking client meetings.

Retention

81%
rate

What factors have contributed to your strong retention rate?

As a company, we collaborate with local workforce development organizations to source and employ urban youth. We recruit the majority of our workforce from the graduate pool of the Youth Food Project’s Culinary and Food Entrepreneurship Training program, an Oakland-based non-profit. They support with retention by providing case-management services and wraparound support to our youth, helping with things like housing and childcare. In addition, at TTK we place a strong emphasis on internal promotion, work to integrate concepts of restorative justice and have a culture committee that plans community-building events like bowling parties and movie nights. These efforts have resulted in our stronger-than-industry-average retention rate of 81%, compared to the 39% you usually see.

How did you overcome the early-stage financing gap that many urban-serving businesses face? Where or to whom did you look to raise the early capital needed to get your business off the ground?

Early on, we leveraged crowdfunding to iterate and test our model. We used a 0% interest loan from Kiva Zip to print custom boxes and test our menu. We raised $42k on Indiegogo to launch, with $25k going to capital expenses. While crowdfunding can be a challenging experience, the network of supporters helped with everything from branding to generating business leads. After crowdfunding, we bootstrapped to $1 million in revenue in 2016. In 2017, we raised $1 million in seed funding. Urban Innovation Fund led the round and was joined by Better Ventures, Rose Culinary Ventures, Slow Money and SheEO.

What’s next? Five years from now, what do you hope TTK will have achieved?

Right now, there are more unemployed young people in the world – 71 million– than we’ve ever had at any point in history. That’s a lot of unrealized potential. In five years, we envision The Town Kitchen as a national company, with a food hub in every major urban city that’s employing thousands of young people. Ultimately, we hope to be an example of a social impact model that people can look to in creating innovative, long-term solutions for the young people who need it most.

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Funding the Inclusive Cities of Tomorrow, Today

It is time to retire the false choice. Too often, we hear that you have to choose between fixing aging infrastructure, building resilience, or mending inequity. Our experience with the latest City Accelerator tells us that, in reality, sometimes you can have it all. By acting on these subjects together, local leaders can take non-traditional approaches that draw the connection between capital budgets that better weather business cycles and climate change, consider avoided costs as a form of revenue to support investment choices, and bring future value to current residents by allowing them to benefit from increased jobs, incomes and wealth. Infrastructure development, done right, fosters economic and social impacts for low-income populations while building more stable financial strategies.

Underfunded infrastructure creates real costs for Americans. According to a report by the American Society of Civil Engineers, failing infrastructure costs America’s families $3,400 annually in lost disposable income. Low-income communities are affected most. Since this City Accelerator initiative began, the news has been rife with health crises due to poor water infrastructure and natural catastrophes that vulnerable urban residents, predominantly people of color, could not escape and are still dealing with. These events exacerbate existing issues that these communities face, making it difficult for them to benefit from or contribute to their city’s prosperity.

In our latest City Accelerator guide, “Resilience, Equity, and Innovation,” we share the tools and processes four cities, Pittsburgh, Saint Paul, San Francisco and Washington D.C., explored in an effort to increase equity and fund infrastructure. With new approaches to managing public resources, these cities showed how low-income residents in particular benefit from capital projects that drive cities forward.

Resource
Document:
Resilience, Equity, and Innovation: The City Accelerator Guide to Urban Infrastructure Finance


Download 

More information 

Over the course of 18 months, these cities overcame multiple obstacles and identified dozens of funding strategies from local, state, and federal sources. They were able to raise funding for the planning phase of a capital project and prioritize (or in some cases, re-prioritize) them through internal and external stakeholder engagement. Three of the cities focused on a high priority asset in their capital plan: Pittsburgh’s 800 sets of public stairways, Saint Paul’s brownfields, and San Francisco’s seawall. Washington D.C.’s Office of Public-Private Partnerships (OP3) designed guidelines and criteria for evaluating public-private partnerships (P3) projects, with an initial focus on upgrading the city’s streetlights.

Their City Accelerator experience, captured in this guide by Jennifer Mayer, a national expert on infrastructure finance who served as the subject matter expert for these cities, can help other local governments identify future savings and revenue to finance the projects that their communities need today. The guide includes a framework for financial strategies – building the project vision, discovering diverse revenue and funding sources, identifying financial tools, considering alternative delivery models, and putting strategies into practice – but also reminding cities what’s often needed is not available capital, but the revenue to pay back what they borrow.

Of the myriad financial tools reviewed in the guide, none can create revenue. What the guide does show is that cities whose capital plan is oriented towards accomplishing economic development, racial and income equity, and environmental quality outcomes, will also identify appropriate financial tools, unlock new sources of revenue, or even enter a new type of project delivery model more easily.

Our City Accelerator cities took on an infrastructure finance challenge because they can and because they must. As San Francisco Mayor Lee and other mayors reflected on their cities’ participation in the City Accelerator, cities have a unique ability and responsibility to deliver swift and successful infrastructure solutions to their residents. After reading this guide, some cities may prioritize administrative ease in selecting capital budget options. Other cities may find the investments in additional staff time and expense worth the increased financial capacity. No matter what, we encourage cities to take action.

Pittsburgh, Saint Paul, San Francisco, and Washington, D.C. broke down the siloes of funding and planning and created teams with representatives from across four city departments – economic development, planning and public works, and the mayor’s office – to come up with solutions that others across the country can learn from and adopt. By taking their lead, other cities can use the lessons and the resources in this guide to build tangible and sustainable resiliency and equity in our cities.

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Five Steps We Used to Scan the Entrepreneurship Landscape

The energy and buzz surrounding entrepreneurship is tremendous, but the data is disturbing. The rate of new businesses started declined roughly 50 percent over the last four decades. Countering this trend, among just the cities, financial institutions, and foundations that make up Living Cities’ partner network, there were more than 180 distinct initiatives promoting entrepreneurship. That’s enormous breadth, and only a tiny fraction of the field.

But are these initiatives collectively making systemic change? If you throw a stone in a pond, you get a ripple. If you aim well and time it right, you can throw a second stone and strengthen the first ripple. With 182 stones, the sector is making a big splash and generating excitement, but it’s not clear that the impact is compounding. Better coordination and alignment across programs, interventions and funding in entrepreneurship is critical to moving us from a series of large splashes to a more dramatic wave of change. The first step is identifying what we’re throwing.

This blog post is a process guide that shares how Living Cities created a strategy map that inventoried the initiatives within the Living Cities network. Four Living Cities team members undertook a two-month process of identifying all 182 initiatives. The purpose of this exercise was to start an informed, strategic conversation about how Living Cities invests and supports entrepreneurship. Creating the strategy map allowed the team to spot trends in the field, find gaps where better ideas and interventions are needed, and determine common performance metrics and opportunities for better coordination and alignment between partners in the field. This work is still in its early stages and generated as many questions as it did answers. Click here for the blog post in which the team shared their high-level findings.

As Living Cities’ focus on entrepreneurship in low-income communities progresses, particularly among entrepreneurs of color, we want to be intentional about sharing our process. By sharing, we hope that others will see value in taking stock of their own initiatives to identify better paths forward.

The Process

1. Set some parameters.

You’ll start your inventory or strategy map by assembling a team. Before that team dives into the data, you must set parameters. Early in the research stage, it may become clear that there are a lot of grey areas. Even the slightest differences in how the Living Cities team was defining “entrepreneurship” had implications on what made the cut and what didn’t. The team was intentional about discussing their scope, definitions and the questions the research would try to answer:

  • What small business strategies are currently being implemented across Living Cities’ portfolio? And what are their barriers, outcomes and metrics?
  • What small business strategies are currently being implemented across our member portfolios? And what are their barriers, outcomes and metrics?
  • What strategies, if any, are being tested by those outside our network that are different from the strategies inside our network?

The team logged their definitions, and took copious notes when topics that needed discussion and group consensus emerged.

2. Dig in.

The team spent more than a month compiling the data, separating it by the type of entity doing the work. They captured data, such as the initiative name, a description and overview, the funder, the location, a measurement strategy, and the data source. They interviewed other staff, reached out to partners, made phone calls, asked questions, and studied reports. They aimed for comprehensiveness and captured it.

3. Codify it.

At this point, they had a list. It was a good list, and a detailed list, but the breadth made it difficult to grasp. The team sat in front of a blank whiteboard and asked, “So, what did we see?” They debated, contemplated and tested to come up with a set of eight barriers that they saw emerging through the data. An inclusive discussion helped them discover the major themes and a rough taxonomy to organize the data in tandem. The entrepreneurship team chose Barriers-Solutions-Activities as their framework, but this is far from being the only option. An ongoing on project on municipal procurement found that organizing data and initiatives into a set of goals with action steps was a better fit for the data. The process takes trial and error, but must achieve two things. First, the framework must serve your purpose for the project. Second, the framework and codification must fit the data.

4. Pressure test and map.

Once the team established the higher-level categories, over the weeks that followed they debated, contemplated and tested them again to assign initiatives as part of their set of solutions and activities. The process was complex, but produced a rich, intellectual and energetic discussion. Everything had to have a home. The team kept notes that outlined the rationale behind the placement of each initiative to defend their reasoning later in the process. The team was intentional about revisiting early decisions and reassigning initiatives to solutions or activities as new ones emerged. Their goal was to ensure consistency in placement of the 182 initiatives. At the conclusion of this process, the structure of the map was complete and it was ready for feedback.

For each initiative, the team asked:

  • Do these categories fit?
  • Are there better categories for this work?
  • Do we agree?
  • Have we labeled similar initiatives consistently?

Everything had a home, and the team agreed on the home.

5. Package it and solicit feedback.

Feedback from content experts and practitioners is invaluable and necessary for this type of process. While the team may be well equipped and knowledgeable in the space, biases will inherently emerge in the discussions. The Living Cities team prepared a version of the map to share that included framing, goals and questions for the project. They shared it with people in and out of the Living Cities community, and they solicited specific feedback, which was captured and incorporated and then shopped back out to others. Rich discussion on the document resulted in an even richer final product.


This is not, to be clear, a guide to create a comprehensive plan to reverse the decline in entrepreneurship, or to solve any other of the vexing and complex challenges that those reading this blog take on in their work. What it can provide is a valuable tool, one that helps you identify gaps where you’re needed, and ideas where you can partner. Key to making this exercise productive is to tackle it as a team. Collaboration in the research and debate result in a far stronger resource and far better starting point to move into additional phases of the work. Important, too, is seeking feedback from the community and partners. Buy in from external voices provides additional lenses and perspectives, opens up the potential for better partnerships, and highlights the blind spots in your work. For the first time, we can clearly see the stones we can throw in the pond. Now it’s time to think timing and strategy.

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