Monday, August 31, 2020

The Emerging Managers Summit, to be held virtually on September 24th, highlights the benefits and opportunities for institutional and private wealth investors to invest in new, small, diverse, women owned, emerging, and boutique fund managers. The program seeks bring smaller diverse managers into the limelight as they have historically outperformed their larger peers. This event will take place entirely on Opal Group’s custom Virtual Event Platform, giving an opportunity for delegates from around the world to connect online. Key decision makers from family offices, endowments, foundations, and pension funds will be able to virtually interact with emerging managers, as well as share best practice ideas with peers. Hear from our panel of experts to stay up to date on the ever-changing emerging manager market. https://opalgroup.net/conference/emerging-managers-summit-virtual-2020/

Sunday, August 30, 2020

Response to Proposed Department of Labor ESG Rule


On June 23, 2020, "the U.S. Department of Labor proposed a rule that would 'update and clarify' the Department of Labor's investment duties regulation. According to the news release issued announcing this proposed rule,

"Private employer-sponsored retirement plans are not vehicles for furthering social goals or policy objectives that are not in the financial interest of the plan," said Secretary of Labor Eugene Scalia. "Rather, ERISA plans should be managed with unwavering focus on a single, very important social goal: providing for the retirement security of American workers."

Our 135 page response, filed on July 26, 2020, concerned the social impact of the proposed rule, and stated that:

"With this proposal, we believe the Administration and, by extension, the Secretary, have violated their oath to protect the public and should resign or be removed. Of course, we understand how committed these specific individuals are to self-promotion, as evidenced by their willingness to damage the public.

We will oppose this draft rule in Federal Court. As a recommendation from a Department headed by a person appointed by a president who conspired with foreign interests to win election so that he could damage the US, (as evidenced, once again, by this action) we believe any proposals put forward are illegal."

We provided a complete listing of all violations of law and custom that the Administration has committed over the past few years, including and leading up to 200,000+ deaths from the COVID 19 crisis.

The letter can be downloaded at: https://drive.google.com/file/d/126T-F0dwZLTdArOyduYZVcLD36Xtlqj_/view?usp=sharing

Thursday, August 27, 2020

The largest Black-Led (but not Black-owned) bank in the U.S.


Black-Owned Broadway Financial Corporation and “Black-Led” CFBanc Corporation announced a merger of equals that may lead to the creation of the largest Black-led (but not Black-owned) bank in the U.S. The resulting institution will have more than $1 billion in combined assets and approximately $850 million in total depository institution assets (as of June 30, 2020).

(Also see: BLACK BANKS MERGE TO CREATE NATION’S FIRST BLACK-LED BANK WITH OVER $1 BILLION IN ASSETS. https://www.blackenterprise.com/black-banks-merge-to-create-nations-first-black-led-bank-with-over-1-billion-in-assets/

Black-Owned Banks in LA, DC Announce Merger.
https://mynewsla.com/business/2020/08/27/two-black-banks-merge/

Merger of two Black-led banks aims to help break a painful cycle https://www.latimes.com/business/story/2020-08-27/black-banks-broadway-federal-bank-city-first-merger )

Broadway is one of the best Black banking institutions in the US, based on their longevity and positive impact on Black homeownership in the Los Angeles area.

The fact that the new institution will have a presence on both coasts is positive. It means the resulting bank will be able to present itself as having an impact in multiple geographies. This will allow it to get assistance from majority-owned banks on both coasts.

A number of questions remain:

Black-Led versus a Black-Owned. Being Black-owned implies a higher degree of control, and, thus, a higher level of concern for Black economic interests. As a Black-led, but not Black-owned financial institution, how well the partnership with CFBanc actually reflects Black economic interests remains to be seen.  In 2002, the Federal Deposit Insurance Corp. expanded the definitions of what constitutes a "minority bank" claiming the old definition "ambiguous." Now a bank that does not meet the ownership test can be designated an MDI (minority depository institution) if 51% or more of the directors on the board are members of those minority groups and the community the bank serves is primarily minority. This change did not lead to an increase in lending to the Black community on the part of Black banks. (See: https://www.americanbanker.com/opinion/minority-bank-designation-has-become-meaningless and https://www.blackenterprise.com/executives-working-to-create-black-owned-holding-company/)

Attitude and flexibility of the bank’s main regulator, the Office of the Comptroller of the Currency (OCC). In addition, the bank will be listed on the Nasdaq. Will it be allowed use this platform to raise significantly more capital?

Impact Investors? With Community Development Financial Institution (CDFI), Minority Depository Institution (MDI) and Benefit Corporation designations, the bank is positioned to take advantage of funding from impact investors to Black firms. How well the firm will use these designations and any resources that come about because of them is another question. The ability of the resulting institution to actually increase their commercial lending as opposed to simply increasing “capacity” will be critical.

Other transactions? The financial advisors are Keefe, Bruyette & Woods and  Raymond James & Associates, Inc.  Mega white shoe law firms Arnold & Porter Kaye Scholer LLP and Covington & Burling LLP are serving as legal counsel to the parties. These firms are the major financial institution transaction advisors in the US. They are also very expensive. We suspect they are engaged as part of their contributions to Black Lives Matter. This implies there may be other Black bank transactions in the works.

Cooperation and collaboration across ethnic lines. This crisis may force us to the realization, finally and literally, that we must "live together as brothers or perish together as fools." What would be of more impact and relevance would be cross ethnic group (Black and Asian, Black and Hispanic) mergers and cooperative agreements.

The one positive impact of centuries of racism may be to have exposed massive opportunities for cooperation and collaboration across ethnic lines. 

Wednesday, August 5, 2020

Six (6) Companies Are 70% of Black Lives Matter Pledges


According to a new report issued by Creative Investment Research, as of August 3, 2020, $7.854 billion in corporate pledges have been made to facilitate efforts that support racial justice. Just six companies account for 70% of that total.


Also see: https://youtu.be/t7aqn7oGGj0 via @YouTube 

Creative Investment has launched a crowdfunding campaign to pay for the development of a BLM Corporate tracker: https://www.gofundme.com/f/tracking-corporate-donations-to-blm?rcid=r01-159828617213-f92f83fc925f4b9a&pc=tw_co_campmgmt_w&utm_medium=social&utm_source=twitter&utm_campaign=p_lico+share-sheet To donate directly, please contribute at paypal.me/cirm 

Tuesday, August 4, 2020

CRUZN COZY has started a kickstarter campaign

During quarantine, CRUZN COZY has started a kickstarter campaign in high hopes of getting business adjusted to the new norm for all of us worldwide.



Here at CRUZN COZY, we understand that everybody has been affected in some way by this quarantine period. Whether that be emotionally, physically, mentally, or socially. It's been hard for all us, but if you can find in your heart to give just a small token, that will be greatly appreciated. Any amount helps. No amount is too small or too big. A percentage of generated sales from merchandise or the campaign will be given to organizations who help people that are in need of shelter, food and clothes during quarantine. Any backer who gives $100 dollars or more will receive free merchandise from our new collection, and backers who give $200 or more will receive 2 VIP tickets to the SBFW New York Fashion Show Tour 2021. 

Thank you so much for your time. One small act of kindness can touch the hearts of many. 


Best Regards,

CRUZN COZY Team 

Thursday, July 23, 2020

How to Use Crowdfunding in 2020


With the attention placed on financing small (especially Black) businesses during the current crisis, and with the problems identified in government-run business financing programs like the PPP, (see * below) we are presenting updated information on crowdfunding. We draw on what we have learned since we issued, in 2012, our book on the subject. (This was, as far as we know, the first one published.)

Crowdfunding works by allowing an entrepreneur with an idea for a company or product to post the details of the idea or product on a web site such as Kickstarter or Indiegogo. The crowdfunding provisions of the JOBS Act allow start-up and other companies to sell up to $1 million in equity, or ownership shares, in their business.

Our company has been facilitating this type of business financing since July 1998, and. most recently, in June of 2020. We still believe this is a viable option for minority firms, as we stated in 2012.
How to be successful at crowdfunding

Crowdfunding is about the crowd. To be successful at it, you need to bring or build one. Here's how you do that.
  1. Use multiple channels in a disciplined way to grow your network. Facebook, YouTube, Twitter, Pinterest, Instagram, MailChimp are all tools you must use. This effort should start 3 months BEFORE you launch your crowdfunding campaign, even if you already have accounts on these platforms.
  2. Generate relevant information on each and every platform that you can use to showcase your project when you launch. (Remember, you have not launched yet.) You are creating a database of contacts by posting relevant information and commentary. Use a tool like Zoho CRM to capture first name, last name, email and phone. 
  3. Just collecting the information is not enough. You must engage with the people you have identified by providing something of value to them in the area of your shared passion. Hopefully, these individuals will become fans, ready, willing and able to spread the word about your project when you launch. If you want to raise a million dollars, your list should include at least 50,000 people. Your fan base should be at least 5,000. It took Dawn that long to develop this list. 
  4. Once you have this list, you should be able to launch your campaign. The campaign should run for at least 3 months, but if you have really done the work outlined, you may be able to see success in as few as 30 days. 
Here is a graph showing the difference in crowdfunding campaigns that take three months in advance to prepare versus those that don't. The no prep campaign runs for twice as long and raises half as much.


Our final advice is to beware of platforms and consultants who tell you they can shortcut this process. We know one guy who charges $20,000 minimum to have you do the work we just outlined. In the years since we published our book, we uncovered crowdfunding platforms who specifically will not list projects run by Black people on the theory that their chances of success have proven to be lower. (Of course, if a platform won't let you on, you chance of success with that platform is zero...)

*We have run into supposedly minority focused PPP lenders, like Lendio, who are determined not to make loans to Black people.

With the right preparation, we think this funding option is an increasingly viable option for small, Black and women run firms.

If all of this is new to you, consider taking our class, How to Crowdfund. https://www.udemy.com/course/how-to-crowdfund or getting our book on the subject. The JOBS Act: Crowdfunding Guide to Small Businesses and Startups on Amazon: https://www.amazon.com/gp/product/B01MT104U1/ref=dbs_a_def_rwt_bibl_vppi_i0

Tuesday, July 7, 2020

Black communities need more help from the Federal Reserve Board

An estimated $7 billion in corporate pledges have been made to facilitate efforts that support racial justice, and help activities that seek immediate solutions to the crisis affecting Black people.
We are very familiar with these types of promises, having launched the first website focusing on financial support for minority communities in 1995 and a new website to monitor such corporate pledges.
Yet it appears that only $188 million of that $7 billion is money someone can reasonably expect to get their hands on. Further, in certain sections of the Black community, there is concern about the effectiveness of the traditional organizations identified as recipients of the pledges. And there appears to be less concern with newer, trending organizations.
Our recent survey of customers banking at black-owned banks suggests most consumers who do not use Black banks are concerned about their financial stability, and have not been able to leverage financial resources from these institutions.
Programs that rely on secondary institutions to provide capital to already underutilized Black-owned banks add another stumbling block to the effort to get capital where it is needed.
Certainly, more money will help. But there may be more effective methods such as creating a digital wallet and currency to get money directly to affected communities without the need for money-sapping intermediaries; or creating a large credit program at the Federal Reserve. The latter approach holds the most promise.
Recall that the Federal Reserve Board created a secondary market corporate credit facility to purchase a more diversified portfolio of corporate bonds that include supporting large employers. Regrettably, very few Black-owned firms are eligible for this program, having been locked out of the corporate-debt market largely due to discrimination, both involuntary and self-imposed.
The Fed also created the Main Street Lending Program meant to encourage cash flows to small and midsize businesses by purchasing up to $600 billion in loans. But already, the number of black-owned small businesses plummeted by 41% between February and April when the coronavirus pandemic started in the U.S., according to a working paper published by the National Bureau of Economic Research.
The financial loss to the Black-owned businesses is estimated at $23 billion due to the pandemic. Therefore, the Fed should allocate $23 billion of the $600 billion in its Main Street program to Black-owned firms, using a wide array of financial instruments and techniques.
Lastly, Black people need a truly collaborative and cooperative effort — in and by the Black community — a community often trained to be petty and cutthroat to each other given the paucity of resources at its disposal. After Creative Investment Research, in the public spirit, disseminated an estimate of corporate pledges to the Black Lives Matter cause (at $1.6 billion), several foundations made donations totaling $1.7 billion.
Now is the time to let go of bad habits for the survival of the Black community. In so doing, we can also show the world the way out of the crisis.
First published at: The American Banker Newspaper: Black communities need more help from Fed https://www.americanbanker.com/opinion/black-communities-need-more-help-from-fed 

Friday, June 26, 2020

Black Bank Survey

We are conducting a customer satisfaction survey on Black Banks

To participate, see: https://www.surveymonkey.com/r/YQZXZY7

Questions include:

1. How frequently do you utilize Black-owned Banks?
2. What is your overall satisfaction level when dealing with Black-owned banks? (5 starts - highest).
3. Have you had success in getting  loans, etc. from Black-owned Banks?
4. Are/were you worried about the financial stability of Black-owned banks?
5. Do you believe that Black-owned banks prioritize your needs?

For a list of Black banks, see: https://www.minoritybank.com/research/blackbanks.html

See: The country’s last black-owned banks are in a fight for their survival.
https://www.washingtonpost.com/news/wonk/wp/2015/02/13/the-countrys-last-black-owned-banks-are-in-a-fight-for-their-survival/

2011 - Crisis - The Current State of #BlackBanks  https://www.prlog.org/11541435-crisis-the-current-state-of-black-banking.html 

2016 - Creative Investment released an analysis of the Black banking sector, drawing on 30 years of research. Recent efforts to increase deposits in Black banks are admirable, but the number of Black banks has fallen from 55 in 1994 to 23 in 2016. - The State of #BlackBanks #BankBlack https://www.prlog.org/12579507-the-current-state-of-black-banking.html 

Thursday, June 25, 2020

Is capital haul too much of a good thing for Black-run banks? By John Reosti, American Banker Newspaper, June 24, 2020

An effort encouraging investors to buy stock in Black-run banks could create new challenges for
the leaders of those companies.


The Buying Black movement, which took root last week, led to sharp increases in the shares of
companies such as Broadway Financial in Los Angeles, Carver Bancorp in New York and M&F
Bancorp in Durham, N.C.

An influx of new investors could increase pressure to improve shareholder returns, while any
strategic effort designed to generate higher profits could also draw a backlash. At the same time,
markets are fickle — most shares in Black-run banks have fallen significantly in recent days as
some existing shareholders cashed out.

Indeed, Broadway's biggest investor — who had been pushing for the company's sale —
abruptly sold all of its stock after the value of its holdings soared.

Leaders of Black-run banks contend that what they need more than capital is more partnerships
with bigger banks to extend their reach to underserved customers.

Broadway has faced all of those challenges since Capital Corps bought a nearly 10% stake from
the Treasury Department in May 2019.

Capital Corps, a mortgage lender founded by former Banc of California CEO Steven Sugarman,
briefly mounted a proxy challenge after offering to buy Broadway. Sugarman claimed that the
$504 million-asset company had strayed from its mission of lending to minority communities.
After facing stiff resistance from Broadway’s management and board, Sugarman opted to sell
the shares. Capital Corps liquidated its stock at roughly $2.62 a share, or nearly double what it
paid the Treasury.

The saga at Broadway serves to illustrate why minority-run banks are often reluctant to court
new investors.

Black-run banks “like the status quo,” said William Michael Cunningham, CEO of Creative
Investment Research in Washington and a longtime proponent of Black-owned banks.
“They don’t necessarily want a lot of attention, and they’re super-conservative, in part because
they don’t have a sufficient asset base" to grow aggressively, Cunningham added. "They really
have to guard every penny.” (As the links below show, we forecast the decline in Black Banks.)


See: Crisis - The Current State of Black Banking. By: Creative Investment Research, Inc. June 14, 2011. 

The Current State of Black Banking. Aug. 12, 2016 

William Michael Cunningham announces support for USBC/Liberty Bank #BankBlack Credit Card. Jan. 23, 2017

See our Black Bank Survey. https://www.surveymonkey.com/r/YQZXZY7


 For a list of Black banks, see: https://www.minoritybank.com/research/blackbanks.html.

Instead, Black-run banks are eager to strike partnerships to access more customers, said Kenneth Kelly, CEO of First Independence Bank, a $265 million-asset Black-owned bank in Detroit. The bank's $102 million portfolio is split between commercial real estate and one- to four-family mortgages.

Establishing partnerships between African American banks and larger institutions has been a
priority for the Treasury Department. It established a mentor-protégé program that has helped
several Black-owned banks, including First Independence and the $108 million-asset Unity
National Bank in Houston, gain a share of fee income tied to processing financial transactions.
“We’re open to partnerships with larger banks that could allow us to deliver” more retail products,
Kelly said. “But that’s not where our business model is right now.”

Broadway, like First Independence, is limited by its lack of scale.

Balance sheet constraints, exacerbated by rising home prices around Los Angeles, have
influenced Broadway's business model. The company focuses more on lending to multifamily
developers than residential mortgages, said CEO Wayne-Kent Bradshaw.

More than three-fourths of Broadway’s $430 million loan portfolio was concentrated in
multifamily lending at March 31, according to the Federal Deposit Insurance Corp. Mortgages
made up less than 15% of total loans.

“Working poor people don’t have the opportunity to buy houses,” Bradshaw said in response to
Sugarman’s criticism.

Funding five- to 25-unit apartment buildings in minority communities “is damn near God’s work,”
Bradshaw added. “We’re very committed to the low- and middle-income community.”

Previous efforts designed to help Black-owned banks have delivered fleeting benefits.

The 2016 Black Money Matters movement, led by the rapper Michael Render, led to an initial
uptick in deposits. The lift was short-lived; deposits at Black-owned banks have fallen steadily in
recent years, according to FDIC data.

Total assets held by Black-owned banks have fallen by nearly 30% since peaking at $6.8 billion in
2008.

Capital Corps said in a letter included with Tuesday’s regulatory filing that it had offered to
provide Broadway with “at least $1 million in pro bono services and technical assistance” to help
the bank make more mortgage, consumer and small-business loans.

While he did not address Sugarman's offer, Bradshaw said he "was very glad" Capital Corps
cashed out. “They bought at a discount and sold for quite a premium.”

Shares of Black-owned banks are typically thinly traded and subject to wild fluctuations. While
they can shoot up quickly with an influx of investors, they can also plummet if shareholders like
Capital Corps decide to sell.

Carver’s stock, which rose sixfold last week to reach $12.20 a share on Friday, is down 28% this
week, ending Tuesday at $8.78 a share. While M&F’s shares increased by 57% last week, ending
Friday at $5.10, they closed at $3.50 on Tuesday.

Broadway’s stock got as high as $7.23 a share on Friday. It ended Tuesday at $2.56.
To be sure, some stocks have continued to rise, including IBW Financial, the parent of Industrial
Bank in Washington, which is up 9.3% this week after rising by 35% a week earlier. Shares of
Harbor Bankshares in Baltimore have quadrupled since June 12, closing at $2 a share on Tuesday.
Lenders need reliable long-term investment, said Kelly, who chairs the National Bankers
Association, the trade group representing African American banks.

“We really don’t need episodic support as much as we need systemic support,” Kelly said.
“I hope what we’re seeing in the high level of interest is something that is sustainable and is
systemic moving forward," he added. "We do serve a unique population, and it should be part of
the American Dream.”

John Reosti, Reporter, American Banker Newspaper.

Thursday, June 18, 2020

Media Partner for Reuters' Free "State of Commodity Trading" Webinar

Reuters Events will be hosting a free online webinar series focused on commodity trading and commodity value chains. Creative Investment Research serves as Media Partner for the events.

Commodity traders are under pressure to undergo massive transformation. Unprecedented volatility, changing consumer and governmental demands, digital transformation and an intense geopolitical landscape are impacting every commodity stakeholder.

That's why, on Wednesday June 24, Reuters Events will kick off their 2020 webinar series with a live fireside chat entitled "A View From the Top".  Reuters' Editor in Charge (Energy, EMEA), Dmitry Zhdannikov will interview Mercuria Energy Trading's CEO, Marco Dunand.

Sign up to tune in live or get the recordings at the link below.

The fireside chat will address the following key discussion points to provide listeners with C-suite market insights:

• Understand how volatility is affecting the energy markets and learn how to respond effectively
• Discover the unique opportunities in commodities, in a covid-19 era
• Hear the energy sector outlook to help you map your future operational strategy

Sign up to tune in live or get the recordings. Can't join live? Register now to get access to the recordings.
https://zoom.us/webinar/register/8715922146896/WN_uqjXmGjESrCwA72bVNqL2Q

Furthermore, all webinar registrants will be automatically enrolled for a free pass to the inaugural Reuters Events Commodity Trading Summit (November 16-17, Online).
https://reutersevents.com/events/commodities/?utm_campaign=5179&utm_medium=Webinar%201%20Press%20Release&utm_source=Media%20Partner%20Creative%20Investment%20Research

If you would like more information on Reuters Events Commodities, the Commodity Trading Summit or the webinar, please contact Kathryn Bloxham at kathryn.bloxham@thomsonreuters.com.

Reuters Events exists to deliver the intelligence and foster the relationships that shape strategy and safeguard success at leading companies worldwide.

Wednesday, June 17, 2020

American Corporate Responses to Black Lives Matter now total $4.628 billion.

American Corporate Responses to Black Lives Matter now total $4.628 billion.

See our crowdfunding campaign...Help make it happen for American Corporate Responses to Black Lives Matter on @indiegogo https://lnkd.in/gmWFprW


Tuesday, June 16, 2020

$60 Billion in Additional SBA Grant Funding

On June 15, 2020, the SBA announced they were restarting the EIDL program with an additional $60 billion in funding. 

Independent contractors, freelancers, and gig workers can receive a $1,000 grant which you do not have to repay. Small businesses can apply for a grant of up to $1,000 per employee. Maximum $10,000. Loans from $150,000 to $2,000,000 may also be available.


See the video at right for more information.


Friday, June 5, 2020

The Current Crisis


Five months ago, our nation was made host to a virulent, deadly visitor, brought to this continent surreptitiously. A new virus, uncovered in China, unsparing in occurrence.

Now we are engaged in a great experiment, testing whether any nation with fearsome, monstrous divisions based on race and wealth, can survive in the face of such a disease. We have come to give our testimony while we still can, in an increasingly authoritarian environment. We do so to support the survival of all who participate in this society. We are writing not as people of wealth and privilege but as ordinary people, like the medical and public safety workers who gave their lives that this nation might live. As citizens of the world, we have an obligation to speak out. As citizens of the US, we have the right to do so.

We offer an independent viewpoint, having gained insight from American history – in this case, Black Wall Street/Tulsa, Oklahoma. Our perspective helps us better understand the exact nature of the problem the country now faces. Of course, in a larger sense, we know that monetary impacts pale in the face of human pain and suffering. This mandates a focus on the human, not the economic.

The world will not notice, nor remember, what is written by common people of limited means, without the ability to correct the current condition. Our goal is to simply suggest that this situation should not be used to argue for the inherent inferiority of those most impacted. We are dying at elevated rates not due to some ingrained defect. Rather, the defect resides in a racist, bigoted and biased system for the allocation of resources, including police and health care resources. This crisis offers an opportunity to correct this misallocation.

As an organization, Creative Investment Research has long been dedicated to this unfinished work. We call upon you, the reader, to insure that these deaths ultimately have meaning —and that democratic government, tasked with providing fairness and equity, will not cease to exist.