June 20, 2023
Ex-Wall Street Executive Raises Over $23M To Help Communities Of Color Build Wealth
Known as MoCaFi, the firm provides financial services to government entities to enhance the efficiency of delivering those and other resources to underserved communities nationwide. It also helps those it serves to gain low-cost services, mobile banking, build credit, as well as receive access to capital.
The Black-founded fintech recently gained major support after securing millions in funding during a Series B financing round led by Commerce Ventures. Other funding participants were new strategic investors, including BNY Mellon, Wells Fargo, Truist Ventures, and existing investors.
MoCaFi will use the new financing to help beef up its offerings and unite with more government agencies targeting the similar audience of people the company caters to.
MoCaFi CEO & Founder Coaxum told BLACK ENTERPRISE in an interview the financing will allow his firm to expand its products and services in cities with large Black populations and Black mayors it was not serving before. He says they include New York, Chicago, Dallas, Atlanta, Cleveland, and Houston.
Coaxum added the partnership with BNY Mellon would allow MoCaFi to work with more federal government agencies, including the Department of Housing and Urban Development (HUD), the U.S. Department of Transportation, and the Internal Revenue Service. Coaxum explained that is a big deal because those agencies have billions of dollars that can be allocated to Black Americans but may not reach them now.
Take HUD, which provides funding for first-time homebuyers among its services. Support for Black families and individuals seeking to buy homes is certainly needed. The homeownership rate for Black Americans trails greatly (44%) and has only risen 0.4% in the last decade and is almost 29 percentage points less than white Americans (72.7%) based on this. It is the largest such Black-White gap in 10 years.
Coaxum and his firm hope to help change that. “With MoCaFi’s platform, we can get dollars to individuals who qualify for first-time homebuyer and down payment assistance from HUD more efficiently.”
In a statement, he added, “This Series B round allows MoCaFi to scale quickly and validates our unique business proposition. With this capital and, more importantly, support from these terrific strategic investors, we can continue to innovate and bring our products and services to more municipalities, government entities, and community partners—ultimately helping more people.”
MoCaFi was founded in 2016 by Coaxum, formerly a managing director at JPMorgan Chase in digital sales. He started MoCaFi after being inspired by the 2014 murder of teenager Michael Brown in Ferguson, Missouri. MoCaFi disclosed that with over $100 million in financial resources disbursed to underserved communities across 15 cities and counties nationally, it is using its capital to fulfill that vision and scale.
During the summer of 2023, the New York City-based firm plans to launch “On Our Block” in New York City with multiple community groups, including the Bedford Stuyvesant Restoration Corporation. The initiative would bring banking services, financial programming, and resources to building pathways to wealth for communities of color. In June 2023, MoCaFi and BNY Mellon united to extend payment options to unbanked and underbanked communities in the U.S.
Dan Rosen, founding partner and head of Fintech Investments at Commerce Ventures, stated, “MoCaFi’s scalable payments platform enables government agencies (Federal, State, and Local) to disburse benefits directly to vulnerable populations in some of the country’s largest municipalities, including Los Angeles, CA, St. Louis, MO, and Birmingham, AL.”
He added, “We’re excited to see the company deliver similar value to the next dozen municipality clients while also enabling the under-banked to get access to digital banking services and pathways to accessing credit and building wealth.”