WEBVTT - Why Black Wealth Matters

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<v Speaker 1>This is Bloomberg Business Week with Carol Masser and Jason

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<v Speaker 1>Kelly on Bloomberg Radio. Solomon Ali is head of the

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<v Speaker 1>advisory firm Solomon R. C. Ali Corporation. He is also

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<v Speaker 1>CEO of NDR Energy Group, and he joins us on

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<v Speaker 1>the phone from Charlotte, North Carolina. Solomon, nice to have

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<v Speaker 1>you here with Alex and myself. Well, thank you for

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<v Speaker 1>having me. It's a pleasure, you know, I wanted to

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<v Speaker 1>kind of lead in UM Bloomberg News. We've been doing

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<v Speaker 1>a lot of reporting about diversity within the financial community

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<v Speaker 1>on Wall Street and a recent story said that today

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<v Speaker 1>not a single chief executive officer of a major US

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<v Speaker 1>bank is black. UM, and I do want to get into,

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<v Speaker 1>you know, wealth creation among the black community, because one

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<v Speaker 1>of the things that certainly has been coming out, certainly

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<v Speaker 1>in the light of George Floyd in Minneapolis, is again

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<v Speaker 1>talking about the inequalities when it comes to blacks versus

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<v Speaker 1>white in our our community, and a lot of it

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<v Speaker 1>has to do potentially with the financial community, an access

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<v Speaker 1>to wealth creation and access to banking. So talk to

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<v Speaker 1>me a little bit about that and what you're seeing. Well,

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<v Speaker 1>from my perspective, I believes that access to capital for

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<v Speaker 1>minority of people that look like me is systemic. UM.

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<v Speaker 1>It's been allowed for a very long time, and when

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<v Speaker 1>you block us out or deny us access to capital,

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<v Speaker 1>it just makes it a a little bit more difficult. When

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<v Speaker 1>you look at from the other side, we are the

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<v Speaker 1>largest consumers in the United States out of all the

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<v Speaker 1>various nationalities, so we have a lot to contribute um

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<v Speaker 1>to business and we do a lot of the work,

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<v Speaker 1>but unfortunately we're just not being given the opportunity to

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<v Speaker 1>get capital. So one of the things that we tried

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<v Speaker 1>to do is demystified UM access to capital and what

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<v Speaker 1>that actually means and what it looks like, and how

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<v Speaker 1>to actually get it for people of color. So what's

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<v Speaker 1>the transmission mechanism that's broken that's preventing that from happening

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<v Speaker 1>right now? Basically the whole are trying to fix. The

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<v Speaker 1>whole we're trying to fix is very simple. We have

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<v Speaker 1>a lot of legislation that's been done many years ago

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<v Speaker 1>before you and I UM and we weren't included. People

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<v Speaker 1>who look like we weren't included. And when they began

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<v Speaker 1>to try to include us, they had people who were

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<v Speaker 1>making policies that were I will use the words not

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<v Speaker 1>sensitive to who we were and what our needs were,

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<v Speaker 1>because they didn't want us to live next door to them.

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<v Speaker 1>They didn't want us to have access to capital because

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<v Speaker 1>they felt like we would be competing for the same

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<v Speaker 1>capital that they were trying to achieve. And that's why

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<v Speaker 1>you have approximately thirteen thousand publicly traded companies and you

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<v Speaker 1>have fewer than fifteen black how managing um publicly traded

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<v Speaker 1>company And you would say, well, how could that even

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<v Speaker 1>be in the day's age. Well, so talk to us

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<v Speaker 1>a little bit about that and what's happened and why

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<v Speaker 1>it hasn't opened up more. Well, it hasn't opened up

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<v Speaker 1>more because they don't want it to open up. Now.

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<v Speaker 1>Who they are is very simple. The establishment has a

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<v Speaker 1>set of rules together. And it's not the bank's fault.

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<v Speaker 1>It's not even current policymakers fault. But at some point

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<v Speaker 1>these rules have to be revisited that they are actually inclusive. UM.

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<v Speaker 1>So that we included because if you want minorities have

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<v Speaker 1>access to capital. UM, you can get minorities to have

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<v Speaker 1>access to capital B by regulating very simple. You know,

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<v Speaker 1>you give us we don't want to hand out we

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<v Speaker 1>do want to hand up. So if you could just

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<v Speaker 1>simply imagine helping someone up to create jobs. According to

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<v Speaker 1>the U. S Government, most jobs are created by people

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<v Speaker 1>who look like themselves. So I'm an employer, I'm hiring

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<v Speaker 1>someone that looks like me, and that's why unemployment amongst

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<v Speaker 1>blacks are so so high, especially amongst black males. So

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<v Speaker 1>I can totally see then how you're connecting all the

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<v Speaker 1>dots right, because if you don't have minority owned, black

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<v Speaker 1>owned businesses, then you're not going to have the people

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<v Speaker 1>who hire other people who look like them, which then

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<v Speaker 1>creates more wealth in the community. Getting the government to

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<v Speaker 1>do anything right now on this except for rhetoric, I

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<v Speaker 1>just I can't imagine that's going to happen. So you're

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<v Speaker 1>actually putting your money where your mouth is and you're

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<v Speaker 1>actually trying to help support that. What kind of concrete

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<v Speaker 1>steps have you been able to take to help give

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<v Speaker 1>access to capital um to black owned businesses. Well, we've

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<v Speaker 1>find a group of various investors together and we helped

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<v Speaker 1>to fund different deals and transactions. Recently, we helped to

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<v Speaker 1>fund a lab out of Georgia Energy company Technology Company.

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<v Speaker 1>So we go through the whole gaming We don't go

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<v Speaker 1>looking to borrow, mine or anything to that nature. We

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<v Speaker 1>use our own resources and we rely on our own

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<v Speaker 1>network UM to do this. And so what we look

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<v Speaker 1>for is companies that have between three to five million

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<v Speaker 1>dollars that are very much overlooked and a poise to

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<v Speaker 1>actually grow, but they lack the capital and sometimes even

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<v Speaker 1>the strategicness to actually develop and grow the company to

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<v Speaker 1>take it to the next level. So we come in

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<v Speaker 1>and we provide the capital and some strategious planning to

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<v Speaker 1>help them to grow and scale their business. Solomon help

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<v Speaker 1>me understand though, how you get to that three million

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<v Speaker 1>dollar thresholds, Like, what about the people under that? How

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<v Speaker 1>do you help them? Well, basically what we do is

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<v Speaker 1>we help provide to provide a strategic planning for their merger's,

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<v Speaker 1>acquisitions and just strategies on how to grow and scale

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<v Speaker 1>their companies. And then we work with a group of

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<v Speaker 1>investors UM that will loan them money and things of

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<v Speaker 1>that nature. I've been doing this for about thirty something

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<v Speaker 1>years being an entrepreneur and access in clientance. So again

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<v Speaker 1>we just try to domestify what that actually looks like

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<v Speaker 1>and brain companies in minority companies, people that look like me,

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<v Speaker 1>and just help them to by strategic planning and by

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<v Speaker 1>getting them access to capital and arranging for funding so

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<v Speaker 1>that they can grow and normally what that will allow

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<v Speaker 1>them to do. It helps to provide them with the

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<v Speaker 1>working tools that they need for that strategic planning, for

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<v Speaker 1>exit strategy out because as we know, before, the largest

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<v Speaker 1>investment that most Americans had, especially African Americans with their homes,

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<v Speaker 1>and now that we have even less homeownership than we

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<v Speaker 1>did previously, the largest investment that they have is their savings.

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<v Speaker 1>And African Americans are saving far less than their counterparts

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<v Speaker 1>of whites and things of that nature, so we have

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<v Speaker 1>less disposable income, we have less income, and so trying

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<v Speaker 1>to teach them, one business at a time how to

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<v Speaker 1>make the shift and redirect some of their resources into

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<v Speaker 1>their business so that they can also hire people that

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<v Speaker 1>look like there and help to grow the economy. You

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<v Speaker 1>know you asked earlier about the black CEOs, um bankers

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<v Speaker 1>and things of that nature, Well, we need to create

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<v Speaker 1>more black owned businesses so that the black banks can

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<v Speaker 1>have more deposits because typically um they don't see a

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<v Speaker 1>lot of deposits and they're so heavily regulated, and we

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<v Speaker 1>have some challenges um and meeting some of the different

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<v Speaker 1>regulatory requirements because of the lack of capital, because we're

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<v Speaker 1>always struggling financially. So I hear what you're saying, but

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<v Speaker 1>I do wonder and going back to don't you need

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<v Speaker 1>all of the major big banks on board to also

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<v Speaker 1>be supportive to really kind of open up, um, you know,

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<v Speaker 1>the access to capital for black Americans. Well, I would

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<v Speaker 1>like to UM say, yes you do. But really what

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<v Speaker 1>you need is the federal government to sit back and say, Okay,

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<v Speaker 1>we realize that it has been an unfair and unjust

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<v Speaker 1>playing film. So now we're going to bring in some

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<v Speaker 1>regulations requiring the banks to make various loans, um and

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<v Speaker 1>things of that nature. You know, back in the day,

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<v Speaker 1>we used to have a program called Score where you

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<v Speaker 1>had a lot of former CEOs of companies that would

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<v Speaker 1>actually help you and you've worked through the Chamber of

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<v Speaker 1>Commerce and things of that nature. You know, local rotary

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<v Speaker 1>club that would help you on your business plan and

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<v Speaker 1>your business strategies and things of that nature. So you

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<v Speaker 1>gotta read called blacks don't have access to a lot

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<v Speaker 1>of other successful black people that's in business. Um, constantly.

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<v Speaker 1>We're looking at the athletes, we're looking at movie stars

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<v Speaker 1>things of that nature, but we're not looking at a

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<v Speaker 1>lot of black men and women who are successful in

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<v Speaker 1>business that has been doing it okay. And so that's

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<v Speaker 1>what we have to show them, is that it can

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<v Speaker 1>be done. Let that be the dream. I remember when

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<v Speaker 1>I started out years ago, I was always told, oh,

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<v Speaker 1>you want to be the CEO of the one right

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<v Speaker 1>in the check. I don't say that anymore. I don't

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<v Speaker 1>want to be the one right to check. So the

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<v Speaker 1>one right to check is a target, especially if you're

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<v Speaker 1>a black CEO. Okay, you are a target for a

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<v Speaker 1>regulatory and you know. Look, I was on the board

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<v Speaker 1>a three publicly traded companies as an officer, as a

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<v Speaker 1>director and required to raise money other three companies. We

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<v Speaker 1>cornered the market. In two we created the fifth largest

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<v Speaker 1>minority energy company in the United States. We took our

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<v Speaker 1>i T intellectual property, and we cornered the market and

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<v Speaker 1>smart home technology with the security systems and everything of

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<v Speaker 1>that nature. So it can be done, but work is required.

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<v Speaker 1>And the only way you get a chance and opportunity

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<v Speaker 1>to do the work is unless you have the access

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<v Speaker 1>to the capital, and it is a problem that can

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<v Speaker 1>be it's it's not something that won't work. I think

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<v Speaker 1>Senator Corey Bookers said it very simply. If you were

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<v Speaker 1>to give us approximately fifteen billion dollars to actually fund

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<v Speaker 1>African American companies, then what will happen is we will

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<v Speaker 1>be able to contribute approximately one point five trillion dollars

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<v Speaker 1>to the local economy. That is huge, especially especially when

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<v Speaker 1>you think that we are the largest consumers. We make

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<v Speaker 1>up roughly as part of the gd We make up

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<v Speaker 1>roughly three point five cent um seven percent of the

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<v Speaker 1>g D. Key that's huge, and that's as a consumer.

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<v Speaker 1>So we just need to shift our thinking right right now.

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<v Speaker 1>It's um an interesting perspective and I think an important

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<v Speaker 1>one certainly, you know, with the background and backdrop of

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<v Speaker 1>the last few months and trying to understand, uh, the

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<v Speaker 1>inequalities that continue in our evasive in our society. Solomon,

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<v Speaker 1>thank you so much. Solomon Ali, chief executive officer of

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<v Speaker 1>nd Our Energy Group. He is also head of the

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<v Speaker 1>advisory firm Solomon R. C. Ali Corporation. Joining us on

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<v Speaker 1>the phone from North Carolina,