The New Jersey “40 Acres and a Mule” Fund (NJ FAM) announced that Bank of America has committed to provide an equity investment in its NJ FAM Fund. The fund is a $100 million private investment vehicle established in 2020 to reduce social and economic disparities resulting from systemic racism. Bank of America’s commitment would be the fund’s first private equity investment from a Fortune 500 financial institution amid strong and growing national interest in socially responsible investing.
Bank of America’s commitment will support expansion of the NJ FAM fund, which puts capital directly in the hands of New Jersey’s Black and Hispanic-Latino business owners, who traditionally suffer from the greatest barriers to accessing capital and other resources. The investment follows the bank’s previously announced commitment to invest $1.25 billion over five years to advance racial equality and economic opportunities in minority populations and its recent equity investment in minority focused funds.
“A strong and vibrant business community benefits everyone,” said Alberto Garofalo, president of Bank of America New Jersey. “Our equity investment in NJ FAM is intended to deploy capital to Black, Hispanic-Latino, other under-represented minority and women-led entrepreneurs so they can grow, expand job opportunities, and make a positive impact in their community.”
The City of Newark’s Mayor Ras J. Baraka announced the innovative fund in September 2020. Then, due to a growing need to combat social and economic inequalities resulting from systemic racism, as well as the acute need for minority businesses to access capital as a result of the pandemic, increased interest in the initiative led to its rapid expansion, now including eight cities across New Jersey: Newark, Orange, East Orange, Paterson, Camden, Trenton, Irvington, and Atlantic City.
“The NJ FAM Fund will help cities like Newark and other municipalities navigate the challenges caused by the racial wealth gap, and we are incredibly grateful for Bank of America’s generous support,” said Newark Mayor Ras J. Baraka. “Thus far, the City of Newark has committed $2 million to the NJ FAM Fund.”
The NJ FAM Fund was created with assistance from Nelson Mullins, one of the nation’s largest leading law firms in private equity fund formation, policy and legislative advocacy. Additional funding commitments have come from companies and celebrities such as, New Jersey Community Capital, AT&T, Panasonic, RWJ Barnabas Health and Shaquille O’Neal.
“The growth of the NJ FAM Fund and participation from forward-thinking global investors like Bank of America is a testament to our well-timed focus on meeting the needs of New Jersey businesses that have been underserved far too long,” said Bernel Hall, managing partner of the New Jersey FAM Fund. “We look forward to expanding this initiative as more partners join our efforts.”
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