CLOSING THE EQUITY GAP

How to invest for a better world.

Decrying the fact that most venture capitalists “worship in the church of greed,” Klein and Kapor, founders of the impact investment firm Kapor Capital, offer myriad examples of businesses they have supported that are focused on doing good—specifically, on closing “gaps of access, opportunity, or outcome for low-income communities and/or communities of color.” An impact investment firm, the authors explain, aims to get a substantial return on their investments by funding entrepreneurs “whose own life experiences compel them to create companies and build wealth that will solve the difficult problems that they personally had to overcome.” Not surprisingly, those people come from underrepresented groups, including immigrants and children of immigrants, racial minorities, women, and individuals who identify as queer. At Kapor Capital, write the authors, “every person involved in making the fund’s investment decisions is a person of color.” They profile an impressive assortment of ventures responding to social, political, economic, and environmental problems, including Bitwise and Career Karma, companies helping people from underrepresented communities train for and secure jobs in the tech industry, notoriously dominated by White males from Stanford and Harvard; BlocPower, which uses a highly sophisticated software system to identify energy efficiency or inefficiency in low-income neighborhoods; Aclima, which aims “to close equity gaps in race, the environment, economics, education, and health by quantifying disparity as it relates to the quality of air people breathe; and Honor, which uses technology to make home health care more accessible and equitable. “What’s wrong with the larger ecosystem of mainstream tech and venture capital,” the authors assert, is that “its mission is to solve problems for the rich, and its players believe they’re smarter than the experts.” Although the authors address venture capitalists, they urge employees, consumers, and shareholders to join their efforts to make a positive impact.

Inspiring examples of responsible capitalism.