Business
5 Black USA Founders Working to Make the Financial System More Equitable By Gabrielle Bienasz
GROWING UP, DENNIS CAIL didn't have any banks in his Monroe, Louisiana, neighborhood. He saw payday lenders charge his father and uncle, who both worked at the local paper mill, 30% fees to cash their checks, plus exorbitant interest rates if they needed to borrow money. So after a career in M&A advisory, Cail decided to try to remedy these all-too-common issues--and help people pay their bills. In 2018 he started Dallas-based Zirtue, a fintech platform that helps people lend money to family or friends at a 0% interest rate for loans with a term of less than one year, or 5% for longerterm loans. Peerto-peer lending, which accounts for an estimated $184 billion annually, can be applied to any expense. So Zirtue structures lending agreements between friends and family members and automates the repayment process, making it easier for its individual customers to pay their bills and for its corporate customers to collect payments. When you arrange to borrow money from a family member to pay your heating bill, for example, Zirtue's new service sends the funds directly to the energy company. The app "helps keep the lights on, the car running," Cail says. Starting in February, customers who use Zirtue to borrow money to cover a bill will also have access to a bank account and debit card. Cail is one of a wave of Black entrepreneurs attempting to address the racial wealth gap and build more equitable access to financial services. According to the Federal Reserve, in 2019 the typical White family in the U.S. had eight times the wealth of the typical Black family. "Less wealth means Black Americans are underrepresented
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in the market for financial products and services," states a 2020 report from McKinsey. Here are four more Black founders who aim to fix that.
1. Kelly Ifill, Guava Brooklyn, New York-based Guava helps Black-owned businesses bank and build community, and has plans to offer assistance with access to lower-barrier loans. Founder and CEO Kelly Ifill grew up in a family of immigrants and entrepreneurs in Brooklyn's Brownsville neighborhood. She had a job in venture capital but quit to start Guava when she saw how hard the pandemic hit Black-owned businesses. (Guava wasn't her first startup--she had previously co-founded a venture firm, Seneca Network, to help diverse founders get capital.) "I am trying to enact change for people I love and care deeply about, she says. "And that's hard." She's taken on a huge issue: the lack of access to startup capital Black business owners often have. The average Black-owned startup has $500 in outside equity upon founding, compared with $18,500 for a typical White-owned business, according to the National Bureau of Economic Research. Guava has raised $500,000 to date, and in mid-January completed an invite-only launch. Ifill hopes to have a couple thousand users by the end of the year and be able to lend to small businesses on the platform by early 2023.
2. Craig J. Lewis, Gig Wage Gig Wage makes it easier for companies to get money to gig workers, with instant payment options and easy integration into company software. "Our vision is to be financial infrastructure for the gig economy," says founder and CEO Craig J. Lewis,
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