How far is wealth?

My Wednesday afternoon was planned differently. One tying up loose ends, being certain every outstanding email had a response and that I could get home early enough to truly enjoy the evening. Things changed when I read Kelly Burton, PhD , Founder and CEO of Black Innovation Alliance 's post, stating that wealth in white family households was 46x that of black homes and that 36% of the black population in Atlanta have zero wealth according to data from a report released by the Kindred Futures (AWBI).

This new data made me wonder about Chicago, D.C., South LA, and the other cities where my work as Co-Founder and Managing Partner of Partners in Equity (CRE Private Equity Fund, focused on owner-occupied) will take me soon and how critical our work has become. White household wealth is 10x black household wealth is the statistic that we, our peers, and anyone who has been in front of America's wealth disparity often quote. A national metric that now limits the individual and nuanced understanding of the fiscal slippage experienced in communities across the U.S., forcing local impact capital into the gap. Our job is to demonstrate the value in closing the gap alongside impact investors, to encourage American dry powder off the sidelines and into the margin of opportunity in underinvested markets.

Leaping into a rabbit hole led me back to Geert Hofstede's definition of power distance, "the extent to which the less powerful members of institutions and organizations expect and accept that power is distributed unequally." A description created by a scholar cited the world over and, simply put, is the philosophy of cultural hierarchy and its influence on individual relations (or racial demographics). You may be wondering how this folds into the racial wealth gap that has persisted for black households for generations in America and its connection to the future of American life.

By 2040, the majority of the American population will be brown. The wealth gap will grow from astronomical to untenable in just over a decade unless we use what we know to innovate, invest, and redress policy that binds our most vulnerable citizens. After another decade, the 2017 report "The Road to Zero Wealth" tells us that the 10x metric no longer matters because the bottom line is black wealth will be zero in 2053. An outcome that pushes black communities further from a position of personal power.

The AWBI is not alone in its discoveries; the Urban Institute reported just last year that Chicago's wealthiest and predominantly white communities hold 206x more wealth than its poorest and majority brown communities in Cook County. These conditions of disparity have spawned depopulating effects, diluting any potential concentration of future black wealth in historically black neighborhoods. The issue is endemic and scales in communities of color across the U.S. in urban and rural areas. The only time to act is now.

Investopedia defines Investing as "deploying capital toward projects and activities that are expected to generate a positive financial return over time." If capital is a natural being, as suggested by Jed Emerson in "The Purpose of Capital," then it must reevaluate its risk. Capital must move outside of the invisible redlines in private equity that have historically allocated less capital to profiting fund managers of color due to several factors, disproportionately identifying and underwriting investible opportunities that create economic inclusion for people of color. As a fund manager, alongside co-conspirators like The Chicago TREND Corporation and LocalCode placing capital in commercial real estate, we can increase transferable ownership beyond the 6% real estate ownership metric demonstrated in AWBIs report.

The term dry powder comes from historic military battles when soldiers used dry powder in their guns and cannons to keep them dry and working properly during conflict. We are in a war on poverty; the distance between a life lived with dignity and economic security from one generation to the next hinges on asset allocators simply recognizing that where there is little investment, there are outsized gains and professionals that can execute and deliver.