When Isaac Olowolafe Jr. was 15, his family moved from Toronto to nearby Woodbridge, Ont., where he recalls seeing what a tight-knit community could build: thriving small businesses, widespread home ownership, institutional relationships and the accumulation of wealth.
By the time he embarked on an economics degree at the University of Toronto a few years later, the now 37-year-old businessman says, he was already set on bringing that formula to the Black community.
“Since then, I’ve been sort of planting the seeds to do what I can from an economic (point of) view,” said Olowolafe Jr., founder of Dream Maker Ventures, a venture capital and real estate company that focuses on startups led by diverse founders.
Olowolafe Jr. is one of a number of Black business leaders who are bringing their expertise to the BlackNorth Initiative, a group founded by Bay Street veteran Wes Hall that is seeking to use the power of business to end anti-Black systemic racism in Canada.
Olowolafe Jr. is head of the group’s housing committee, and is also championing entrepreneurship through plans for a Black Business Development Hub.
“The Hub will be the centrepiece and physical space which the Black community can leverage to increase access to institutional relationships like banks and universities and government,” Olowolafe told the Financial Post in a recent interview.
The project is a twist on a plan that was already under way when he was recruited to join BlackNorth.
The mixed-use development near Toronto’s main airport will feature more than a dozen working rooms, hotel and event space, and a commercial kitchen — all of which will be used to incubate and develop Black-owned businesses.
Now a partnership between BlackNorth, the Dream Legacy Foundation and Ryerson DMZ, the plan is to raise $10 million in funding to expand the hub from 13,000 square feet to 30,000 square feet, Olowolafe Jr. said.
He says he hopes the business hub will open this summer and ultimately be able to provide services to more than 100 Black entrepreneurs.
Encouraging entrepreneurship through the hub will lead to more successful small businesses and help build institutional relationships, such as with banks, he said. This, in turn, will generate more income and opportunity for home ownership, a pillar of wealth creation.
“Home ownership leads to other ripple effects (that help individuals and communities) over a long period of time,” he said.
To that end, the BlackNorth Initiative’s housing committee is embarking on an effort to create a $65-million fund to provide bridge financing to bring up to 200 working, lower-income Black and radicalized families into the homeownership game.
The committee is in talks with all three levels of government about contributing to the home ownership bridge program. A handful of well-known developers including Tridel, KingSett, DiamondCorp, and The Daniels Corp. and other potential donors have also been approached.
“They’ve all raised their hands to say: ‘How can we help and support and give to this housing initiative?’” Olowolafe said of the developers. “I think that that is a great sign.”
The idea behind the BlackNorth Initiative’s homeownership bridge program is that prospective home buyers would be assessed for mortgages based on the usual criteria of income and assets, with the difference between the mortgage they qualify for and how much credit they need to buy a home “bridged” by a pooled fund.
The bridge financing would, in some ways, be treated as a second mortgage. When repaid by the homeowner, either after the regular mortgage was paid down or when the home is sold, the money would go back into the pool. The homeowner and the pool would share in any gains on the home’s value when sold, with the ratio determined based on how much of the bridge financing the homeowner had paid down.
The intention is to keep the fund rolling, in order to get more people into homes, Olowolafe Jr. said, noting that even if the homeowner were just able to get their own money out of the home it would be more equity than they would have accrued over the same years renting a home.
While Olowolafe is a supporter of initiatives undertaken by the Canada Mortgage and Housing Corporation to get more Canadians into affordable housing, he stands firm on the idea that ownership — not rental options — will be the key to greater success for the Black community.
“I’ve always known that for the Black community as a whole to be able to be an economic leader there were some major things we needed: institutional relationships, building small businesses, and creating more home ownership,” he said.
“All that leads to a thriving community.”
Original story from: https://financialpost.com/entrepreneur/why-entrepreneurship-home-ownership-are-two-powerful-forces-in-fight-against-anti-black-racism
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