WALL STREET COULD NEVER
Transforming extractive systems with Chordata Capital, an anticapitalist wealth management firm.
ISSUE 1: THE UN/MAKING ISSUETo bring these community visions to life, we would need robust financial infrastructures with channels that move resources effectively and equitably in alignment with community-driven goals. Marnie Thompson, Senior Fellow of Seed Commons, calls this infrastructure the “plumbing” that allows capital to flow where it’s needed most. Rather than having each individual “hauling their own buckets” of funding to chosen projects, we need the pipes and connections to funnel investment into our communities at scale. The East Bay Permanent Real Estate Cooperative, one of Chordata Capital’s investees, is a powerful example of why the “pipes,” and their governance, are so critical to community empowerment.
The East Bay Permanent Real Estate Cooperative (EB PREC) is creating affordable housing and preserving cultural spaces in the East Bay—the eastern region of the San Francisco Bay Area in California—with a focus on preventing displacement and empowering Black, Indigenous, People of Color (BIPOC), and allied communities. Through a cooperative ownership model, EB PREC enables community members, residents, and investors to own and steward properties collectively. As of December 2024, the cooperative owns thirty-six residential and commercial units, three commercial and mixed-use buildings, and 2,500 square feet of land.4 This includes two cooperative apartment complexes, a community arts house, a multi-generational home for legacy Richmond residents, and Esther’s Orbit Room—a historic Black jazz club to be revitalized as a mixed-use cultural space.5 These properties support their efforts to foster economic resilience and self-determination for local communities. The cooperative has raised nearly $4 million from investors through its Direct Public Offering6 (with the ability to raise $75 million through this innovative approach) and an additional $11 million in grants and loans for its acquisition fund. In total, $15 million has been raised to date to support the purchase of seven properties for collective ownership.
EB PREC is the first permanent real estate cooperative in the U.S. to offer a DPO under Regulation A+ through the Securities and Exchange Commission (SEC). Selling shares directly to the public can be a burdensome and expensive process for smaller organizations due to strict regulatory requirements and high compliance costs. By bypassing the usual gatekeepers involved in Initial Public Offerings, EB PREC invited everyday people, foundations, and individual investors nationwide to pool resources and help families remain in their neighborhoods not at the whim of rising rents but with a real stake in the land they called home.7
The structure of EB PREC puts real estate decision-making power directly in the hands of residents and community stakeholders, taking properties off the speculative market to ensure long-term affordability and cultural preservation. The organization reinvests the income generated from properties into the cooperative, allowing for further acquisitions and community development. This creates a sustainable cycle of reinvestment and renaissance that prioritizes the economic interests of East Bay residents and local businesses. Taking EB PREC as a model for investing in the solidarity economy, we find that scale, due diligence, legal advocacy, and community control form key aspects for transforming extractive economic systems into regenerative ones.
Scale
To support community-led projects like EB PREC, we need to consider the question of scale: Where does the money come from to support such ambitious visions? The potential to raise $75 million might seem overwhelming, but when viewed in the broader context of charitable investment totaling $557 billion in 2023,8 this effort is actually within the realm of possibility. Redirecting even a fraction of these funds to community-driven projects could have an enormous impact.
By organizing investors around shared values and goals, we can build a financial pipeline that ensures capital flows steadily into projects that prioritize community ownership and long-term stability.
Due Diligence
Traditional due diligence (a process that entails evaluating the projected financial health, proposed governance, possible alignment with community values, and viability of a project) can often act like a clog in the proverbial financial plumbing. It can block the flow of capital to community-led projects by stalling access to capital and making it contingent upon paperwork and bureaucracy. The standard process, which is typically designed solely to protect the financial security of large funds and institutions, forces community organizers to pitch to individual wealthy investors one by one and wait through lengthy review periods. This system makes it difficult for grassroots projects to access capital quickly, even when they align with investor values, and it fails to prioritize community needs.
Imagine instead a financial commons where investors can easily track capital flow, understand project impacts, and engage in a community-rooted due diligence process. This type of infrastructure would simplify funding access for projects like EB PREC, providing needed capital without months of wait time. Organizations like Resource Generation—a membership community of young people, ages 18-35, with wealth and/or class privilege who are committed to the equitable distribution of wealth, land, and power—and Solidaire—a community of donor organizers who mobilize quickly to provide critical resources and unprecedented solidarity to the front lines of social justice movements—could unite wealthy individuals and wealth-holding organizations to share risks and streamline the due diligence process.
We find that scale, due diligence, legal advocacy, and community control form key aspects for transforming extractive economic systems into regenerative ones
Legal Advocacy
Transformative investments that center communities’ needs over profit inherently disrupt the status quo by challenging deeply entrenched systems of power, which makes them targets for legal and political opposition. Even with a streamlined due diligence process, community-led investments can still face external challenges, particularly legal and political opposition that seeks to disrupt the flow of community-building capital towards initiatives we support. One of the most prominent obstacles investors can face in this work are the rare but significant anti-social justice investment lawsuits like those faced by the Fearless Fund. The fund was forced to close its grant program for Black women business owners after a conservative group alleged the program was discriminatory. Conservative activists also sued the small business funding platform Hello Alice over one of its grant programs. While Hello Alice won, reports indicate that the legal battle significantly impacted its financial stability, causing layoffs and potentially affecting its Series C funding round. These legal challenges represent attempts to break the “pipes” that channel capital toward equity-focused investments. Supporting legal advocacy for social justice investments is crucial—not just to protect individual investments but also to safeguard the principles of economic justice that underpin community-led projects.
Without legal advocacy, these challenges can halt progress, discourage new investments, and undermine the confidence of community stakeholders. Standing with the community in these battles is a form of solidarity that aligns with the core values of social justice investing. It affirms a core principle motivating liberation work: communities have the right to self-determination and the freedom to build their own economic futures. By standing firm and contributing to legal advocacy, investors would be contributing to the creation of a robust, community-controlled financial infrastructure that is resilient against backlash and endures over time.
That said, it’s important to note that many community-led investments have not required a legal battle. For the majority of projects, legal obligations focus primarily on due diligence. Most community-led initiatives, such as local businesses, cooperatives, and nonprofits, can achieve their goals without facing significant legal opposition.
That said, it’s important to note that many community-led investments have not required a legal battle. For the majority of projects, legal obligations focus primarily on due diligence. Most community-led initiatives, such as local businesses, cooperatives, and nonprofits, can achieve their goals without facing significant legal opposition.
Community Control
At the heart of this financial infrastructure lies the aforementioned desire and principle of self-determination at the scale of the neighborhood, which is also referred to as community control. For organizations like EB PREC, community control is about ensuring that the “master plumbers”—those directing the flow of capital—are the community members themselves. EB PREC has worked with attorneys to design an investment structure enabling supporters to engage with and direct investments in a non-extractive and regenerative way. But true community control requires diverse, accessible models for investment that center on the voices of those most affected.
Prioritizing leadership and governance structures that reflect and understand the communities being served is essential, requiring a reexamining of business and financial practices to ensure they are truly regenerative. A payday lender offering immediate loans, for example, can be Black-owned and still be extractive. At Chordata Capital, we intentionally center Black women’s and BIPOC leadership while simultaneously supporting leaders with a direct stake in the community’s success, understanding that authentic transformation requires this dual approach.
Navigating how to support a solidarity economy also means facing contradictions and complex trade-offs. The sole effort of a cooperative grocery store might build wealth for residents of color, for instance, while potentially raising local property values and making housing less affordable. This underscores why we need a diversity of complementary strategies like rent control policies, community land trusts, and participatory budgeting processes to ensure sustainable, equitable development.
Community-governed financial structures provide a way for communities to collectively dig into these complexities and make decisions about investment and economic well-being, rather than leaving those choices to external investors. Instead of outside investors cherry-picking “virtuous” companies or cooperatives, directing investment dollars toward community-governed funds shifts power into the hands of the people most affected.
Navigating how to support a solidarity economy also means facing contradictions and complex trade-offs.
Looking Forward
Investing in the solidarity economy isn’t about isolated successes; it’s about building an infrastructure that supports networks of interconnected, community-led efforts. This “plumbing,” influenced by scale, due diligence, legal advocacy, and community control, enables communities to protect their assets and shape an economic landscape that prioritizes equity and resilience over profit. As we support investment in these projects, we’re not just supporting a single cause; we’re investing in a future where communities have the resources and power to shape their local economies and flourish on their own terms.