For Part One of this Article click here.
In June 2020, Netflix announced plans to allocate 2% of the company’s cash holdings – initially up to $100 million – into Black banks and similar financial institutions that build economic opportunities for Black communities in the US. The announcement generated a lot of excitement, as well as some questions from many organizations hoping to take similar action.
I met with Aaron Mitchell, the mastermind and driving force behind this effort at Netflix and Bill Bynum, CEO at Hope Credit Union, one of Netflix’s first partners in this effort to learn more about the idea that has created such a powerful ripple effect two years later – and discuss the creation of the Playbook to show more companies can join the movement to support the Black community.
I asked Bill Bynum, CEO at HOPE how he would describe the impact of Netflix’s initial commitment in terms of the capital it has been able to unlock.
“Netflix’s commitment of $10 million is nothing short of transformational. First of all, it creates significant impact in underserved communities. At the time of the commitment, HOPE agreed to use the investment to support 2,500 entrepreneurs, homeowners and individuals of color over a 24-month period. We exceeded the goal, supporting 7,334 entrepreneurs, homeowners and individuals of color,” said Mr. Bynum.
He continued, “Second, Netflix really approached the investment as a partnership. The company leveraged its communications expertise to launch a highly effective media relations strategy around the announcement. The coverage raised HOPE’s profile as a credible black and woman-owned financial institution and partnering with other companies. Netflix also launched a short series, Banking on Us, which profiles several HOPE members and highlights the magnitude of the racial wealth gap.”
Last but not least, Netflix’s commitment unlocks new sources of capital through the HOPE Transformational Deposit program, which expands access to capital for Black and underserved businesses, homeowners, households and communities. “The Netflix investment represents our first corporate Transformational Deposit, after which the program really takes off. Since then, HOPE has opened 610 Transformational Deposits for $134 million. This capitalization strategy is the foundation of our ten-year growth plan that includes a commitment to invest $1 billion in the Deep South,” added Bynum.
When discussing the advice they would have for corporate leaders like them who want to encourage their companies to make the same commitment or take the same approach, Mitchell explained, “I think the first thing is to keep it simple. Part of the reason I believe the initiative at Netflix is successful is because it’s very easy to think about moving a small portion of our cash from one place to another and working with partners who have the reputation and track record needed to encourage trust.”
In addition to publishing the Playbook, Mitchell also encourages corporate leaders to continue building their networks inside and outside of their companies. Having people to ask for advice and take action at different stages of this endeavor is critical. It’s important to start building a network today regardless of what you want to do later.
“The sheer randomness of the collection of people I’ve cultivated relationships with over time allowed me to navigate the complexities of this multi-layered initiative and, at the very least, leverage some connections for introductions that made a significant difference,” added Mitchell.
“People of color in the United States now represent an emerging majority. As a result, the company’s customers and workforce will increasingly be people of color. Investing in racial equity not only represents the right thing to do, it’s good for profitability and a proven growth strategy to return value to corporate stakeholders,” Bynum replied.
“To help close the wealth gap, we need more companies to join this movement. If your company is interested in how it all works, you can check out what we’ve learned using this Playbook or contact us. Together, we can contribute to more healing and progress for the Black community,” Mitchell concluded.
When I asked Aaron Mitchell what the future holds for him, he replied “I’m in the process of launching a digital art NFT collection as part of the culture that defines the Web3 business I’ve built. As a musician and just spent the last few years working in one of the most global and influential entertainment companies in the world, it’s clear that Black people define culture, but we often don’t get the benefits or monetization of that culture. we’ve created it. Web3 has the power to change that and Club Pega Visão Salvador will lead both in bringing the rich afro diaspora culture of Salvador, Brazil to the world in a new way, starting with NFT digital art, but we are exploring all forms of media , including animation, music and tourism and consumer products.” All this while drawing Salvador’s artistic and business community into the global economy through the decentralizing power of Web3. It is a sequel to the black banking initiative and allows him to coordinate all these different experiences into a purposeful business networked into an operating system.