Black man in a suit
Joe Scantlebury, CEO of Living Cities

If capital runs the world, then people of color need to have a bigger hand on the wheel. That’s the basic idea behind a new fund from Living Cities, one of the stalwart players in the long effort to close the racial income and wealth gaps in the United States. Those stats are clear: The average white family has 10 times the wealth of the average Black family, and eight times the wealth of the average Hispanic family, according to Pew Research.

Living Cities, which is a collaborative of foundations and financial institutions working on the issue, is launching a new equity fund-of-funds that will invest in funds run by managers who are either of color, or committed to the cause.

Joe Scantlebury, Living Cities CEO, said the fund – which is seeking investments first from the foundations and institutions it typically works with – will aim to produce market-rate returns. The thesis is that a fund that captures the economic value produced by communities of color will do well for its investors, and fund managers in touch with those communities will have an eye for the good investments.

“What if you could invest in, say, salsa right when it was becoming popular?” he said in an interview last fall. Or, there’s the example of “Living Color,” a 1980s television show on Fox that drew viewers from the stodgier networks. (Oh, how the network identities have changed!). Investors who got in early on hip-hop music – say, when it was banned from the radio — could also have seen a big return.

Black man in a suit green tie
Demetric Duckett

 Name: Living Cities

Location: New York City


Size: Living Cities, a nonprofit with a $7 million annual budget, is raising its third fund. The $100 million aims for its first close of $40 million in the first half of this year.

What it is: Catalyst Fund III will be an equity fund of funds which seeks to support and invest in diverse fund managers and those who support the nonprofit’s commitment to diversifying the ecosystem of fund managers and founders.

What kinds of funds does it invest in? Cake Ventures invests in generational technology companies that will address the needs of a world undergoing massive demographic changes, from consumer products to workforce training.

“We are excited to collaborate with companies using immersive tech to change training and skill building or using tech to change end of life hospice care,” she said. “Companies taking big swings at really big markets.”

Investment thesis: Communities of color have long created economic value; much of that value has been extracted from communities. The idea of the Catalyst Fund III is that fund managers whe are part of or committed to those communities will in turn invest in companies owned by people of color.

Track record: This is Living Cities third fund. The first, the $38 million Catalyst Fund, closed in 2008, and had repaid investors 12 years later. Among other things, it helped scale community development finance institutions. Living Cities’ $37 million Blended Catalyst Fund, launched in 2015, lends to companies and intermediaries. It also aims to return investors’ money, but its other purpose was to experiment and develop an investment thesis to help close the wealth gap. From that work, Living Cities decided to launch the third fund, an equity fund that will invest in funds managed by people of color.

Leadership: Scantlebury and Demetric Duckett, managing director of Living Cities’ Capital for New Majority Team, which leads the funds.

This story and others on New Builders Dispatch are made possible by a sponsorship from the Ewing Marion Kauffman Foundation. The Ewing Marion Kauffman Foundation is a private, nonpartisan foundation that provides access to opportunities that help people achieve financial stability, upward mobility, and economic prosperity – regardless of race, gender, or geography. The Kansas City, Mo.-based foundation uses its grantmaking, research, programs, and initiatives to support the start and growth of new businesses, a more prepared workforce, and stronger communities. For more information, visit and connect with and

A business journalist for 20 years, am the founder of Times of Entrepreneurship and the co-author of The New Builders.