A Surge in Digital Banks Focused on the Black Community

The events of last May, surrounding the tragic death of George Floyd, spurred significant change across the United States. Among the less anticipated outcomes was a notable increase in the number of digital banks specifically designed to serve the Black community.

Addressing Unmet Needs

Driven by a conviction that traditional banking institutions were failing to adequately address their needs, members of the Black community began developing innovative startup concepts. These initiatives aimed to provide financial solutions tailored to their unique circumstances.

First Boulevard Secures Seed Funding

First Boulevard, previously known as Tenth, recently announced a successful $5 million seed funding round. Investors included Barclays, Anthemis, and a diverse group of angel investors, such as actress Gabrielle Union, John Buttrick of Union Square Ventures, and AutoZone CFO Jamere Jackson.

The Genesis of First Boulevard

For Donald Hawkins, co-founder and CEO, the inspiration for the Overland, Kansas-based bank arose in the aftermath of Floyd’s murder. Discussions with Asya Bradley, his friend and co-founder, centered on identifying what Black America genuinely required to break free from a recurring cycle of unresolved issues.

A Financially Focused Solution

Hawkins articulated that witnessing another tragedy impacting the Black community, coupled with the familiar protests against persistent problems, made it evident that solutions must be financially oriented and developed within the community itself.

Founders' Fintech Expertise

Both founders brought valuable fintech experience to the table. Hawkins previously founded Griffin Technologies, a company specializing in real-time, contextual intelligence for community banks and credit unions. Bradley was a founding team member and head of revenue at Synapse, a platform facilitating banking-as-a-service APIs to expand financial access.

The Landscape of Black Banks

Their research revealed a limited number of Black-owned banks in the U.S. – approximately 19 – collectively holding around $5 billion in assets.

Identifying a Gap in the Market

Hawkins noted that these institutions often lagged in technological advancements. Furthermore, a thorough evaluation of existing digital banks indicated a lack of focus on addressing the specific needs of Black America and fostering financial stability through wealth-building strategies.

First Boulevard's Mission

Established last August, First Boulevard operates on the principle that Black Americans represent significantly underserved consumers of financial products and services, possessing a collective spending power of $1.4 trillion annually. The startup aims to empower Black Americans to manage their finances, accumulate wealth, and reinvest in the Black economy through a digitally native platform.

Current Waitlist and Launch Timeline

Currently, First Boulevard boasts a waitlist of 100,000 individuals, with an anticipated launch scheduled for the third quarter of the year.

Capital Allocation and Future Plans

The new capital will be allocated to the development of a Black business marketplace, offering Cash Back for Buying Black™. Additional funds will be used to expand the team, increase the customer base, and enhance the platform with features like fee-free debit cards, financial education resources, and tools for automating savings and wealth-building.

Centralizing Finances for Success

Hawkins emphasized that “History has proven that oppressed communities can succeed when their finances are centralized, and when it comes to financial services for the Black community, a centralizing force is long overdue.”

Supporting Black-Owned Businesses

The bank’s Cash Back for Buying Black™ program allows members to earn up to 15% cash back on purchases from Black-owned businesses. Hawkins highlighted that approximately 41% of Black-owned businesses had closed since the start of the COVID-19 pandemic, underscoring the importance of providing support.

Passive Wealth Building

First Boulevard is also dedicated to facilitating passive wealth accumulation within the Black community.

Financial Literacy and Access

Hawkins explained that Black America has historically been excluded from financial literacy and access to wealth-building tools. The platform aims to connect members with assets like money market accounts, high-yield savings, and cryptocurrency – opportunities that have largely been unavailable to them.

A Diverse and Inclusive Team

Asya Bradley, COO of First Boulevard, believes the existing financial industry was not designed to serve the needs of people of color. The company’s goal is to leverage their understanding of the Black community’s unique requirements to provide features such as early wage access, round-up savings, targeted financial education, and budgeting tools.

Commitment to Representation

The founders are committed to building a fully inclusive team that reflects the community they serve. Currently, the 20-person staff is 60% Black and 85% BIPOC. Two-thirds of the leadership team are women, and 100% are BIPOC. The company plans to increase its headcount to 50 by the end of the year.

Industry Recognition and Investment

Katie Palencsar, an investor at the Female Innovators Lab by Barclays and Anthemis, stated that her firm has long recognized the challenges of accessing financial services, particularly for Black Americans residing in financial deserts.

A Unique Approach to Wealth Building

Palencsar believes First Boulevard’s mission of empowering Black Americans to not only bank but also build wealth is distinctive in the market.

Addressing Systemic Challenges

Palencsar noted that “First Boulevard sees the wealth gap that continues to grow within the U.S. and wants to build a digital banking platform that addresses the systemic and structural challenges that face this population while enabling Black Americans and allies to invest in the community.”

Partnership with Visa

The company recently announced a partnership with Visa, making First Boulevard the first to pilot Visa’s new suite of crypto APIs. A First Boulevard Visa Debit card will also be launched.

Emerging Competitors

First Boulevard is among several digital banks targeting Black Americans that have emerged recently. Paybby, a digital bank for the Black and brown communities, acquired Wicket, a neobank utilizing AI and biometric technology for personalized user experiences. Hassan Miah, CEO and founder of Paybby, stated the bank’s objective is to become “the leading smart, digital bank for the Black and brown communities.”

Expanding Services at Paybby

Paybby, which initially offered bank accounts and expedited PPP loans, will soon introduce a cryptocurrency savings account for Black and brown communities.

Leveraging Black and Brown Buying Power

Miah emphasized that Black buying power is projected to reach $1.8 trillion by 2024, and Brown buying power exceeds $2 trillion. Paybby aims to capture a significant portion of this market and reinvest it within these communities.

Greenwood's Focus on Underserved Communities

Last October, Greenwood secured $3 million in seed funding from private investors to establish a digital banking platform for Black and Latinx individuals and business owners.

Addressing Historical Failures

Co-founder Ryan Glover, founder of Bounce TV network, stated that it was “no secret that traditional banks have failed the Black and Latinx community.”