Closing Equity Gaps: AmFam Institute Firm & Portfolio News – December 2023

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News From Our VC Firm Investing in Closing Equity Gaps

Newsletter Highlights: Notes on exploring overlaps between investment sectors, a blog post on our workforce development thesis, a spotlight on a portfolio company helping small businesses succeed, exciting portfolio news, and a Forbes Council article.

?? Opening Note:

If you’ve been following the journey of our fund over the last five years, you’re probably familiar with the four investment areas of economic opportunity, resilient communities, healthy youth development, and equity in education. While these areas remain our focus, the investment associates on our team have more recently spent time exploring the interconnectedness between these areas and the unique opportunities that exist as a result.

As one example, my colleague Chaarvi Badani writes about our approach to workforce development in the first installment in her blog series (below) and teases future installments exploring the opportunity of green jobs, overlapping with her work in climate.

For myself, with nearly five years working in both our Economic Opportunity and Healthy Youth Development spaces, I’ve been drawn to the relationship between health and wealth. How can foundational mental health support enable economic opportunity? And conversely, and even more interesting to me, how can alleviating financial pressures improve mental health and wellbeing?

While this isn’t the mainstream conversation yet, there are murmurings. I had the opportunity to kickstart this conversation on a bigger stage at Money20/20 in October. In my chat, “Fundamentally, Wealth Inequity is Health Inequity,” I urged FinTech leaders in the room to understand how their products affect user mental health. In our own portfolio, Honeycomb Credit (founded by George Cook and highlighted below) reduces the stress for entrepreneurs taking on debt by dramatically growing small business revenue year-over-year, easing the pressure of paying back their Honeycomb investors and effectively transforming a daunting financial transaction into something everyone involved can feel good about. One of our other FinTech investments, LoanSense (founded by Cat Kaiyoorawongs MBA MA and Ivan Herndon ), increases access to homeownership for student loan borrowers. The product makes outstanding student loan debt less daunting, and gets people into homes they wouldn’t have been approved for otherwise, increasing psychological safety and stability in comparison to renting.

While I was preparing my talk in October, our colleagues at the Financial Health Network were publishing their early work in this space for the first time as well, notably calling out the lack of research at this intersection. We are excited to be part of this conversation as our understanding of these connections grows. Please reach out if you’re interested in joining the conversation.

-- Amber H. H. Porter, MBA , Senior VC Associate at the American Family Insurance Institute for Corporate and Social Impact

?? Investing in America’s Future: Empowering Low-Income Communities through Workforce Development

Our journey of closing equity gaps is driven by a commitment to elevating family incomes as a pivotal factor in enhancing overall health and well-being. However, as the COVID-19 pandemic exacerbated unemployment among low-income workers, a critical skills gap emerged, particularly in middle-skilled professions in high-demand fields like Healthcare and IT.

Despite these jobs constituting 53% of the workforce, only 43% possess the necessary skills, leading to talent shortages. The barriers to entry range from misconceptions about certain jobs to confusion about programs and earning potential. To address these challenges, the Institute advocates for a holistic approach, emphasizing effective training, comprehensive support ecosystems, upskilling for professional progression, and more.

The Institute's focus on pathways to middle-skill excellence includes investing in startups like Mentor Spaces , EnGen , and NurseDash , each contributing to different facets of the workforce development ecosystem. From providing effective training and job placement to creating virtual mentorship platforms and offering upskilling opportunities, these initiatives offer a comprehensive solution to bridge the middle-skills gap.

To learn more about these transformative initiatives, read Chaarvi Badani’s article on our blog .

?? Portfolio Company Spotlight: Honeycomb Credit

Meet George Cook , CEO of Honeycomb Credit , a debt crowdfunding platform that provides small businesses with the help they need to grow. George began Honeycomb Credit because he saw firsthand how the absence of community banks hurt small business owners from getting the loans they needed to help their businesses. Honeycomb is helping small businesses owners like Monica Grays of Second Semester Consignment Shop keep her business growing.

?? AmFam Institute Portfolio News

Paladin ’s Kristen Sonday and Biobot ’s Newsha Ghaeli and Mariana Matus, PhD in Cosmopolitan Magazine –?The New C-Suite

Bark in Yahoo Finance – Bark For Schools Announces Major Safety Initiative with Local School Parent Organizations

Bark in ABC7 News –?The Bark Phone - A Safer Option for Your Child's First Phone

Honeycomb Credit in Pittsburgh Inno –?Small Business Saturday puts Honeycomb Credit over $21 million in crowdfunding for emerging businesses

EnGen in Colorado Biz Magazine –?Why is Colorado Providing Free English Training to Small and Mid-Sized Businesses?

BookNook in PR Newswire – Rigorous Study Validates Efficacy of High-Impact Tutoring, Meeting ESSA Level I Standards

ParentPowered in PR Web –?ParentPowered Expands Their Family Engagement Program to Support Families of Children from Birth through Grade 12

ParentPowered in eSchool News – ParentPowered PBC Appoints new Chairman of the Board: Luis Duarte, Partner at Imaginable Futures, as Company Ushers in the Next Phase of Growth

Solstice in PR Newswire – Solstice Opens Pre-Enrollment for Community Solar in New Mexico

BioBot in Local 3 News – BioBot cuts new pathway to tracing opioids through wastewater

?? New Thought Leadership on Forbes Council

Uncover the transformative power of impact investing in John McIntyre ’s latest article, "Climate Change, Equity And Resilience: How Investors Can Have A Triple Impact ." As our world faces unprecedented challenges, investors are realizing their role extends beyond financial gains. The Global Impact Investing Network's recent study revealed that 79% of investors not only met their financial targets but also achieved an impressive 88% success rate in impact goals. Learn how impactful investments can combat climate change, promote equitable access to technology, and strengthen community resilience. Read more on Forbes.

?? What We’re Reading

If you’re looking for a fun fiction read over your winter vacation, but want to be inspired for what we can accomplish together in 2024, check out Naomi Alderman’s THE FUTURE . Her first book since the best-selling THE POWER, THE FUTURE explores the responsibility of technology to create a better world for everyone, and the task before us all to be the change. - Amber

Missed the last newsletter? Here’s our archive ! Please subscribe to future editions here .

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The information contained in this presentation has been prepared solely for informational purposes and is not an offer to sell or a solicitation of an offer to purchase an interest in any entity managed by the American Family Insurance Institute for Corporate and Social Impact (the “Institute”). This document does not constitute an offer, solicitation or recommendation to sell or an offer to buy any securities, investment products or investment advisory services. Any offer or solicitation will be made only pursuant to the partnership agreement, commitment documents, or other similar materials and will be subject to the terms and conditions contained in such materials. The information published and the opinions expressed herein are provided for informational purposes only. This document has been prepared solely for the information of the intended recipient and may not be reproduced, distributed or used for any other purpose. Reproduction and distribution of these materials may constitute a violation of federal or state securities laws.