A New Narrative for North Minneapolis

Funders work together to change the story and trajectory of a low-income neighborhood that's emphasizing its assets.

Originally published in the June issue of Twin Cities Business magazine. 

Which Minneapolis neighborhood has wonderful views of the downtown skyscape, a ready workforce and plentiful residential housing? North Minneapolis, home to more than 63,000 residents. The majority of residents are people of color, and poverty rates are high, which has influenced many in Minnesota’s white majority to view this neighborhood as one deserving of charity and access to social services. The Northside Funders Group, a coalition of foundations, has learned that the neighborhood actually wants business investment, coordinated action by policymakers to encourage these investments, and more urgent responses to strengthen the neighborhood’s underperforming schools.

The north side’s new narrative is that neighborhood change and development can be driven from the inside out. Neighborhood leaders are working toward transformational change, built on the foundation of their neighborhood’s assets, not its deficits. What are the north side’s assets? Talent (a large workforce; 56 percent has some college or a four-year or higher degree), leadership (civic leaders working with common purpose and energy) and geography (including proximity to downtown).

One organization whose work is nearly always mentioned in this new narrative is the Northside Funders Group and its dynamic leader, Tawanna Black. Founded in 2008 when a small group of foundations gathered to share ideas and plans, NFG now has 20 members who have come together to learn about the neighborhood, align their grantmaking for maximum impact, and advocate for policy changes that will benefit the neighborhood’s vitality. Collectively these funders provide $12 million to $17 million annually to about 200 nonprofits serving the area. Black was hired to lead the group in 2013. Since then she’s accelerated NFG’s progress and brought energy and visibility to the role.

Sarah Hernandez, program officer at the McKnight Foundation, co-chairs NFG. She says, “We talk about our levers: the opportunity to learn together, to leverage our giving together, to influence together and to invest together. As a collective of funders, we can realize we can influence not only our own giving but also policy, opinion and investments beyond our own.” Jo-Anne Stately, director of impact strategy at the Minneapolis Foundation, is NFG’s other co-chair. “Through NFG we are getting much better at talking to one another to deal with the larger systems issues. Things are changing, and changing faster,” Stately says.

Two programs in particular seem notable for Twin Cities Business readers; they both offer ways for the business community to get involved. North@Work is a targeted, five-year effort to place 2,000 African-American men in living-wage jobs. When successful, this effort can bring more than $50 million annually in new wages to north side residents and families. Created in response to data that show African American men are the second least likely to achieve stable employment after participating in a public workforce program, North@Work provides training, support and placement services to cohorts of men seeking jobs. While 11 percent of the Minnesota workforce today is African American men, by 2040 that percent will rise to 24. The urgency to help African American men develop the skills, networks and experiences needed to fill new jobs is one shared by businesses, government agencies and nonprofit organizations. Employers will find North@Work a great place to get involved in this “everybody in” collaboration.

The newly announced Opportunity Neighborhoods for Regional Prosperity program builds on North@Work but also brings together multiple workforce development initiatives and has broader efforts. NFG wants to increase the number of jobs reachable by north side residents within a 30-minute commute, develop working capital to invest in neighborhood-based minority-owned businesses, align philanthropic strategies related to economic and workforce development, and integrate this body of work within government agencies whose roles include these sectors. NFG members have identified the mismatch between programs and services in the various sectors as a challenging obstacle to economic development. Activities like making sure locations in the neighborhood are “business ready,” developing transit options that make it easy for residents to get to work, and promoting safety and discouraging crime are all actions that require cross-sector approaches.

“Business leaders can help us by thinking about how they can fully leverage all their strengths to help build the north side’s economy,” Black says. “While they could think in charity mode by giving money or volunteering, the real impact will come from economic development. Business leaders have something major to offer communities. We need your strategy minds,” Black continues. “We need to hear what you think business can do to help our efforts.” Too often, she says, the collaborative nature of Minnesota’s culture is cited. Yet in reality, there is segmented collaboration “at the business table, at the philanthropy table, and at the community table” instead of purposeful pursuit of coordinated, cross-sector approaches. “I know it’s harder, I know it’s slower,” she says. “But it pays off. What we’re trying to do demands deep, cross-sector work, and we’ll need to persevere.”

“Our state can only be as strong as the north side is strong. The economic development of the north side will affect our entire state’s economy and well-being,” Black says. Sounds like a call to action—why not heed it? 

Is the Chan/Zuckerberg initiative a game changer?

Originally published in the February, 2016 issue of Twin Cities Business Magazine

What are the ripple effects from Mark Zuckerberg and Priscilla Chan's charitable giving?

When Facebook founder Mark Zuckerberg and his wife, Priscilla Chan, welcomed their baby girl, Max, they simultaneously announced their intent to give away 99 percent of their Facebook shares “to advance human potential and promote equality for all children in the next generation.” The size of this whopping gift was estimated at $45 billion.

It only makes sense that the Chan-Zuckerbergs chose Facebook to tell their story, scripted as a letter to their newborn and accompanied by a picture of the new family. The multi-page letter is worth a read, as it lays out the rationale and likely interests of what will be a major new philanthropy. What’s unusual, controversial, and therefore the focus of most news coverage: the way the couple decided to structure their “gift.”

What the couple announced is the creation of the Chan Zuckerberg Initiative, a Delaware-based limited liability corporation that Zuckerberg will lead while he continues as Facebook’s CEO. Using the LLC structure, the initiative can do things that a traditional foundation or nonprofit cannot.

Like what?

First, the LLC can invest in startups and existing businesses whose purposes align with the initiative’s stated areas of initial focus: personalized learning, curing disease, connecting people through the Internet, and building strong communities.

Second, the LLC can engage in public policy debates and lobbying in ways that are prohibited within the statutes governing the nonprofit sector.

Third, the LLC can operate outside the regulatory environment of the nonprofit sector, which requires transparency with respect to governance, operations, investments and spending. As private entities, LLCs bear none of these reporting burdens.

And fourth, it can make charitable gifts. It can behave like a traditional charitable foundation by making grants to nonprofits and it can fund individuals without the restrictions faced by traditional foundation structures.

Trista Harris, president of the Minnesota Council on Foundations, shared her thoughts about the Chan Zuckerberg Initiative’s impact on the philanthropic sector. “Maybe tech entrepreneurs, in particular, don’t want to be hindered by the tools they use for philanthropy,” she says. “There is more blurring of the lines between business and philanthropy. Entrepreneurs see many ways to make change happen; charitable gifts are one way, but not the only way.”

What does she mean by blurring the lines between business and philanthropy? “The B corporation, in Minnesota, is a good example,” she says. “These are for-profit businesses with a social purpose. People are trying to figure out how to make a difference. They can volunteer, make a gift, invent new things or start a business. These approaches seem equally valid.”

She and Jon Pratt, executive director of the Minnesota Council of Nonprofits, agreed that the most controversial element of the Chan Zuckerberg Initiative is the lack of transparency in an LLC compared with a nonprofit organization. “There is a public trust that happens when anyone gives a gift to a foundation or public charity. The donor gives up control and they receive a significant tax advantage in return,” Harris explains. But in the case of Chan Zuckerberg, “the couple is preserving their options,” Pratt says. “This was not a transfer of control but a structure that allows [them] to maintain it.” Should nonprofits be worried about this? Neither Pratt nor Harris thinks so. “I think it’s generous,” Harris says. “It follows in the tradition of the Dayton family and the Minnesotans who founded the 2 Percent and 5 Percent clubs in the 20th century” with their statements of philanthropic intent.

“It’s a public expression of commitment,” Pratt explains. “It’s a positive development when people of extreme wealth show that their fortunes should benefit the public.” Harris thinks the couple’s move will stimulate other people to give and reflects a willingness to innovate, exploring all the tools available to achieve the desired results.

Traditional philanthropies in Minnesota are already exploring some of the avenues that Chan Zuckerberg can pursue, though again, the LLC structure allows much more freedom and requires less public reporting. For example, in 2014 the McKnight Foundation announced it would invest 10 percent of its $2 billion endowment assets in businesses that can advance its programmatic aims. Further, many local charities and foundations have invested time and dollars in grassroots public policy work. While their activities fall short of the direct lobbying that Chan Zuckerberg can engage in, they’re nonetheless collaborating on major education efforts to inform public policy. The Minneminds’ campaign—aimed at improving families’ access to quality child care in our state—is a strong example.

The Chan Zuckerberg Initiative will allow all these activities, but under one roof. “These folks have transformed entire industries in relatively short periods of time,” Pratt observes. “So when it comes to solving [seemingly] intractable problems like social justice, better educational outcomes, improved health and environmental protection, they think, ‘How hard can this be?’ They want to get going.”

Why Not Get Involved in the Youth Social Entrepreneurship Collaborative?

Grantmakers and nonprofits involved in supporting youth entrepreneurship have ideas for ways the business community can support their efforts. 

Initially published in the January edition of Twin Cities Business Magazine.

Minnesota nonprofits are part of a national philanthropic movement to support economic opportunity for young people by offering training and work experience that increases financial literacy, fosters entrepreneurial thinking and encourages community engagement.

Youth Social Entrepreneurship (YSE) is a growing effort in the sector, such that Minnesota now has an active YSE collaborative, YSE-MN. The collaborative’s members include grantmakers, youth-serving organizations and social enterprises providing employment and job skills programs for young people. YSE participants typically earn money while taking part in these activities. Focused mainly on teens, these programs offer a way to “learn and earn.”

Research published in February, conducted by Dr. Tina Kruse of Macalester College, explored YSE efforts at 30 programs in four cities, including Minneapolis-St. Paul. Kruse’s report documents that 90 percent of YSE programs specifically target low-income youth. She also shows that these programs not only aim to develop business and financial skills, but also have components that promote social and emotional learning. An additional benefit is the reliance of these programs on intergenerational mentorship and learning that builds relationships between experienced businesspeople and young participants. YSE programs also result in economic development that comes from locating youth businesses in low-income neighborhoods.

The YSE movement’s expanding reach and influence in Minnesota was evident at this year’s annual Youthprise summit in October, which was entirely devoted to youth enterprise. The summit brought together an audience of more than 300 youths who learned about successful youth-developed businesses and learned practical skills to advance their ideas and skills. Keynote speakers were Coco and Breezy, twin sisters and Minnesota natives, now 24 years old, who founded the ultra-hip eyeglasses company as teens. The twins talked about using social media to build their brand, and offered advice and inspiration to the hundreds of youths in attendance.

The lunchtime session at the Youthprise summit was a Technology and Training Expo sponsored by the Sundance Family Foundation. The expo helped business representatives in fields such as robotics, welding and commercial sewing industries connect with youths looking for promising career paths. The focus was on exposing them to living-wage jobs that require short-term training. With some manufacturers in Minnesota facing labor shortages, Sundance plans to expand these expo locations in the coming year to connect young people with Minnesota employers who need a larger pipeline of workers. This effort goes beyond Sundance’s direct financial support for youth-based businesses that include Cookie Cart, Northside Fresh, Juxtaposition Arts, Appetite for Change and other social enterprises that are using business development as a tool to employ youth. Participating youths create products and deliver services while receiving job and life skills training in a real-world setting.

Based in St. Paul, the Sundance Family Foundation was established by Nancy Jacobs and Mark Sandercott. The foundation has a primary interest in YSE and has been an engine for much of this work in our region. Sundance’s total grantmaking in 2015 was about $385,000, dwarfed by the grantmaking budgets of Minnesota’s largest philanthropies. The foundation is nonetheless a vocal advocate for YSE, commissioning research, organizing community meetings and actively seeking partners to expand the field.

It makes sense for Minnesota businesses to get involved in YSE, and fortunately there are multiple paths available. Many YSE enterprises offer goods and services that you can purchase. You can buy cookies for your office from Cookie Cart, the bakery and youth-development program on West Broadway in north Minneapolis (they deliver). Or shop at Dream of Wild Health when they visit local farmers’ markets to sell specialty crops and indigenous foods. You can donate clothing or shop at Sisterhood Boutique, a women’s used-clothing store in the Cedar-Riverside neighborhood in Minneapolis that employs East African young women as interns. There are many more examples in the Twin Cities.

Jacobs says these programs need a larger pot of money; with more dollars, existing programs could expand, and new programs could begin. That’s tied to a second need: a stronger evidence base—showing that the programs work as a way to increase economic opportunity for the youth involved. If these programs can establish a strong evidence base, they will be more competitive for federal funding, says Jacobs. The foundation and Wilder Research are working to build that evidence base among a cohort of 15 Minnesota-based YSE projects.

Finally, Jacobs says that the YSE movement needs industry champions. “There needs to be more networking and dialogue between the various markets in our ecosystem,” she says.

YSE needs partnerships with companies, and access to the skills and resources in the business community. It needs people who want to connect and to create the bridges and pipelines that help YSE programs successfully serve low-income youth. Could that champion be you?

Our region has one of the highest poverty rates for people of color among metropolitan areas in the U.S., with 46 percent of African-Americans living in poverty, compared with 9 percent of their white counterparts in Minnesota. There is an urgent need to create paths for low-income youths to earn family-sustaining wages. YSE models are promising, and they need more connections and support. I’m guessing that many readers of Twin Cities Business magazine are in the perfect position to help.