Comprehensive Guide to Black Owned Investment Firms

William Huston, AIF®, AIFA®

by in Published on April 03, 2022

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Comprehensive Guide to Black Owned Investment Firms

Black Owned Investment Firms

Black investors have consistently been underrepresented in the U.S. stock market. Just three years ago, a study by the Federal Reserve revealed that only 33.5 percent of Black households owned stocks. But that trend is beginning to change for the better.

Throughout the states, a new generation of black wealth managers is creating establishments that offer business opportunities for the black community by improving investing accessibility. In the process, this helps close the racial wealth gap and could lead to a generational impact.

The Ariel-Schwab Black Investor Survey (2020) found that Black Americans under 40 were increasingly engaged in stock investment. In fact, 63 percent of those interviewed acknowledged that they held assets. Their white counterparts also had the same rate. Furthermore, 29 percent said that they began investing the same year, compared to 16 percent of white respondents.

This immense boost in stock market involvement results from the social justice resurgence and pandemic situation. COVID-19 social distancing mandates and lockdowns made people spend less money and time on recreational activities. Suddenly, young adults had surplus resources to invest and sufficient time to consider their options.

You can also be part of this revolution and contribute to closing the racial wealth gap by considering black-owned investment firms.

Why You Should Consider Black Finance Institutions

Wealth, the measure of a family's or a person's financial net worth, offers vast opportunities for American households. It enables seamless transitions between jobs, movement to new communities, and payment of bills. Through wealth, people can pay for their kids' education and build economic sustainability once retirement hits.

Importantly, this is the full measure of a household's future economic well-being. After all, we rely on wealth to address our needs and invest.

Unfortunately, the country's wealth is unequally distributed based on race, particularly between Black and White households. In essence, the average African American family enjoys a portion of the wealth the average White family owns. This leaves them more economically vulnerable and with far rarer economic mobility opportunities.

Less wealth means fewer upward mobility opportunities, made worse by lower income and less likelihood of building wealth or passing accumulated assets own to the next generation.

The other factor is limited access to tax-advantaged savings, partly due to the long employment discrimination history and other inequitable practices. A well-documented history of investment market discrimination leaves Blacks significantly less likely to create finance or investment firms.

Being part of the change towards a smaller wage gap involves considering banking Black or joining a Black-led investment firm, and there're many reasons to do so.

Black-led financial institutions are known to be part of community activities by re-investing their resources and time to support their values and goals. With the economic laps that resulted from the pandemic situation, it's really crucial that such firms continue supporting the households surrounding them.

Moreover, Black-led and Black-owned investment firms let entrepreneurs access capital to begin, expand and keep their business running. By funding these entrepreneurs' dreams, you'll help them gain and also benefit the country's economy.

Which Are the Leading Black-Owned Private Equity, Venture Capital, and Investment Firms?

Consider these options when looking for a successful black-owned investment firm to partner with on your next project:

Bay Street Capital Holdings

Bay Street Capital Holdings is a Black-owned independent investment advisory, wealth management, and financial planning firm headquartered in Palo Alto, CA. They manage portfolios with the goal of maintaining and increasing total assets and income with a high priority on managing total risk and volatility. Although many advisors may focus on maximizing returns, they place a higher priority on managing total risk and volatility.

Impact America Fund

This reputable black-owned investment firm finances organizations and startups within the technology space focused on positively impacting marginalized communities.

Cross Culture Ventures

The firm invests in businesspersons delving into technology that transforms cultural norms through enhanced workplace diversity.

Reach Capital

This leading Black-owned investment firm funds education. The agency considers academics a valuable resource because it strengthens the community and facilitates the establishment of equal opportunities.

Precursor Ventures

Like other Black-owned investment agencies, this capital firm invests in innovative businesspersons by providing sufficient resources to get them started and help them scale.

The Bronze Venture Fund

This agency's primary focus is to make and manage innovative investments that can line up robust financial returns with a significant environmental, social, or economic impact.

Authentic Ventures

This leading Black-owned venture capital firm has gained a reputation by funding young organizations and startups to create solutions to major societal problems.

Harlem Capital Partners

Another successful Black-owned venture capital entity whose objective is to transform operations within entrepreneurship by investing in diverse, innovative founders.

KIC Ventures

This investment holding organization serves the healthcare sector. Its main objective is to develop efficient, top-shelf tech solutions in this highly crucial industry.

GenNx360 Capital Partners

The private equity investment firm invests in organizations within the business and industrial services sector.

Other Black-Owned Banks and Financial Institutions

The above list comprises black-owned entities for investment purposes only. But if you require a retail financial service provider to offer checking and savings account services, several Black-owned banks will serve you adequately.

Here are the leading black-owned banks in the United States and their precise locations:

  • Unity National Bank, which serves three cities in Georgia and Texas
  • Columbia Savings and Loan in Milwaukee, Wyoming
  • Industrial Bank NA with multiple locations in New Jersey, New York, and Maryland
  • Columbia Savings & Loan ASSN in Milwaukee, Wyoming
  • GN Bank in Chicago, Illinois
  • Commonwealth National Bank in Mobile, Alabama
  • Citizens Trust Bank, which serves 15 cities across the U.S.
  • Mechanics & Farmers Bank, operating in five cities in North and South Carolina
  • Tri-State Bank of Memphis, which operates in Memphis, Tennessee
  • Broadway Federal Bank FSB's two locations in Los Angeles and Inglewood, California
  • United Bank of Philadelphia, situated in Philadelphia, Pennsylvania
  • First Independence Bank with locations in two cities within Michigan
  • Harbor Bank of Maryland, serving three cities in Maryland
  • OneUnited Bank, which has offices in three cities across the country
  • American Bank, headquartered in Birmingham, Alabama
  • Liberty Bank & Trust Co, which serves ten cities across the United States
  • Optus Bank serving Columbia, South Carolina residents
  • Carver Federal Savings Bank, located in three New York cities
  • Carver State Bank in two locations within Savannah, Georgia

Your choice to support black-owned investment firms is a great decision. You'll go a long way to keep the entities running and afloat. Step by step, your investment will lessen the disparity gap that has hurt minority communities for generations.

Here are the leading considerations when choosing an investment firm:

What Are Your Individual Needs?

While checking out your different Bank-owned investment firms, it's essential to identify your primary needs. Are you looking for excellent customer service? Is accessibility important to you? Create an elaborate list comprising deal-breakers and must-haves, then begin searching. The main objective is to ensure you pick a Black-owned firm perfectly tailored to your needs.

What Are the Firm's Perks?

Reputable investment firms have great perks to reward new members, and there's no harm in trying to get the most from them. What is your preferred financial institution ready to offer? Some institutions reward joining members with a money bonus (such as a gift card), while others provide discounts on member-exclusive necessities like transportation and hotels. This shouldn't be among the main decision-makers, but it doesn't hurt to try them.

Where Is the Entity Located?

An investment firm's physical location is crucial if you have to sort out a more significant percentage of your activities and processes physically on the premises. In this case, the firm's proximity to the areas you frequent, your office, or your home is critical for easy access. And if you're a frequent traveler for leisure or work, consider an investment firm with an entity allowing transactions in multiple locations globally.

How Much Are the Interest Rates?

These work both ways. You must consider the interest rates you pay when borrowing through a loan or credit card and the rates earned on the resources you deposit with the firm. Ideally, you should consider a financial institution that will charge you lower-than-average interest on loans and higher-than-average interest on what you've deposited.

How Are Their Services?

It's essential to consider the standard financing services you're expecting from your new Black-owned investment firm. Regardless of whether you're partnering with them for business or personal endeavors, you want to be sure that you can access critical services. For instance, you may want a tax professional to address your tax concerns and answer tough questions.

You want to consider plenty of services when looking for an investment firm. Therefore, create a list, then compare it against what's available on the specific investment firm's website, or ring them to verify.

What are Your Digital Needs?

When looking for a reliable Black-owned investment firm, you must consider their internet, mobile, and digital banking capabilities. This is particularly important to rely on these mediums to facilitate your daily transactions. Besides considering all these features when selecting your next financial institution, make sure the firm offers cybersecurity and is compliant with all relevant compliance regulations.

Partner with The Best

As you try to navigate the investment world, you need an experienced investment advisory, financial planning, and wealth management firm to help you get on the right track and get the most from your planned investment. Fortunately, you're on the right site.

Get in touch with us today to learn more.


William Huston, AIF®, AIFA®
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