Advancing Inclusive Ecosystems: Leveraging Impact Investing for Systems Change

An ImpactAssets spotlight highlighting how impact investors and philanthropists can advance racial equity.

Systemic barriers to accessing capital and opportunities stifle economic growth and contribute to the wealth gap, particularly for marginalized communities. Addressing these barriers is necessary, if we hope to drive meaningful progress toward the more equitable world.

That fundamental notion helps inform our focus on investments that advance multi-faceted approaches to building inclusive ecosystems – the type of ecosystem that would represent real headway in addressing racial inequity. More inclusive capital ecosystems will allow communities not only to define their own paths to success, but to prioritize and implement the changes they deem necessary for sustainable growth and long-term equity.

For example, real estate development has immense wealth building potential however it is an industry that continues to grapple with an acute lack of representation--people of color own less that 1% of real estate development companies in the United States. The gaping disparity is largely attributed to systemic barriers including the lack of access to capital and development opportunities as well as limited practical experience and professional networks. This has left developers of color out of solutions to meaningfully shape the built environment in their own communities and benefit from the economic impact of successful development.

By supporting organizations that aim to increase opportunities for marginalized communities, reduce systemic barriers and thereby create more inclusive ecosystems, impact investors can help ensure that initiatives are genuinely reflective of and responsive to community needs.

Two Pathways to Effectively Advance Inclusive Ecosystems

1. Take a Comprehensive, Multi-Dimensional Approach

The work to advance inclusive ecosystems in the United States centers on leveraging capital to increase representation, inclusion and agency for communities that have historically been marginalized as part of every solution to address racial inequity.

In practice, this would include investing not only in entrepreneurs of color, but also in fund managers of color who are dedicated to supporting entrepreneurs of color. And to go even further, it would be ensuring that the products and services that these leaders are creating benefit people of color.

Beyond that baseline, this approach also means investing in enterprises and organizations that prioritize diversity, equity and inclusion in their operations and decision-making processes. By adhering to the above, investors would be partnering with those key changemakers who are dedicated to dismantling systemic barriers and building an equitable future for all.

Photo courtesy of Zeal Capital Partners
Photo courtesy of Zeal Capital Partners

Zoom In: Zeal Capital Partners*
Zeal Capital Partners is a Washington DC-based venture capital firm that intentionally invests in diverse management teams and entrepreneurs, with a focus on narrowing the wealth, skills, and health gaps across the country. Zeal supports businesses that bring essential services to underserved communities and diverse teams — both key aspects of creating inclusive ecosystems.

Zeal works to democratize access to capital because, as Founder and Managing Partner Nasir Qadree puts it, “great and diverse entrepreneurs exist everywhere – not just in very few places.” Qadree founded the firm with a focus on “rethinking how to scale mission-driven companies that are tackling huge, total addressable markets.”

As part of its approach, Zeal embraces a market-backed Inclusive InvestingTM discipline to reach high-growth businesses. “There is untapped market need here where others aren’t looking,” explains Principal Emily Zhen in describing the value. “And there are also diverse founders with lived experiences who understand the market and have true founder-market fit. [We see] how combining both of these aspects in our investing can result in attractive returns.”

Similarly, institutions like Community Development Financial Institutions (CDFIs) and Minority Depository Institutions often deploy multi-dimensional strategies aimed at helping communities of color assert greater control over their own economic futures. These strategies range from culturally relevant tools and training for businesses owned by and serving people of color to policy solutions aimed at driving equitable outcomes.

Zoom In: Enterprise Community Loan Fund (ECLF)*
ECLF is a CDFI that takes an intersectional and collaborative approach to community development, with a focus on addressing America’s affordable housing crisis. ECLF’s work centers racial equity with the aim to dismantle the legacy of systematic racism in housing and close the growing racial wealth gap. From advocacy to finance to technical assistance, its layered approach is designed to strengthen communities through affordable housing.

Photo courtesy of Enterprise Community Loan Fund
Photo courtesy of Enterprise Community Loan Fund

2. Consider Investments that Use Creative Capital

To advance inclusive ecosystems, we must move beyond traditional business models and focus on creating supportive environments that increase skills and build long-term community empowerment and sustainability. Such an approach recognizes the importance of investing in organizations and enterprises that are deeply rooted in the communities they aim to serve, ensuring that these investments do more than just generate returns—they build capacity and foster resilience.

Photo courtesy of NDN Collective
Photo courtesy of NDN Collective

Zoom In: NDN Fund*
NDN Fund takes a transformative approach to investing in economic development by focusing on businesses that are led by and serve Indigenous communities. The fund provides braided capital, which combines different forms of capital from loans to grants to guarantees, with capacity building aimed at promoting resilience and financial sustainability. NDN’s approach is rooted in Indigenous values recognizing the interconnectedness of all things and responsibility to their homeland and each other.


Inclusive Ecosystems Underpin Broad Social Impact
Investing in inclusive ecosystems is an integral part of advancing racial equity and fostering environments where all individuals can thrive. These investments empower communities, foster supportive environments, experiment with alternative ownership models, prioritize diversity, equity, and inclusion, and elevate the voices that most need to be heard.

By investing in these areas, we can collectively contribute to a more equitable society – one in which our investments lead to tangible improvements in community well-being and resilience.


Advancing inclusive ecosystems is a key pillar for ImpactAssets’ racial equity strategy. Learn more about how ImpactAssets Donor Advised Fund Clients can easily access and invest across impact themes including racial equity, climate solutions and gender equality.

*Designates an ImpactAssets portfolio investment.

Top photo courtesy of East Bay Permanent Real Estate Cooperative, an ImpactAssets Client Recommended Investment. 

LEGAL AND PROGRAM DISCLAIMER: This is not a solicitation to buy or sell securities, nor a private placement offering. Nor is this an endorsement of any of the featured financial institutions. It is intended for informational, educational and discussion purposes only.