Bridging the Digital Divide: Connect Humanity’s New Strategy to Finance Equitable Broadband
To expand internet for all, we must catalyze more capital for community-focused ISPs
Since our founding two short years ago, Connect Humanity has put more than 160,000 people (60,000 households) on the path to getting connected to high-speed, affordable internet access. True to our mission, all of our investments have been in low-income, rural, and/or BIPOC communities, and 100% have been in Opportunity Zones. And 75% of our investments have been in minority or women-led ISPs who are working in deep partnership with the communities they serve. This would not have been possible without working in deep partnership with countless community champions, ISPs, leaders at all levels of government, nonprofits, advisors, and the generous support of our funders and investors.
As we’ve worked with hundreds of communities across North America, deployed millions in broadband-focused grants and investments, and catalyzed $47 million in capital for the community-focused ISPs we work with, we’ve learned a huge amount about financing sustainable broadband networks, driving impact for communities, and about how our organization can best contribute to expanding internet access in communities in need today.
Our new strategy
All of these learnings have shaped an updated strategy that will guide our work over the next two years. As you’ll read in the strategy overview, we’re focused on cultivating the partnerships and capital that can support community-focused ISPs to deliver fast, affordable, reliable internet access in underserved communities across the US and beyond.
Over the next two years, we will increase our low-cost, flexible investments that enable community-focused ISPs to build in communities in need, while significantly growing efforts to mobilize other funders to do the same. In our first year, we catalyzed $15 for every $1 invested. By scaling this activity, we can direct hundreds of millions more dollars to advance digital equity. We will evolve the strategic advice we provide, helping unlock new partnerships and capital to support 100+ communities towards building and extending broadband networks. Finally, building on our advocacy successes and leveraging our unique perspective as a digital equity investor, we’ll get more involved in calling for the policy changes required to level the playing field for community-focused ISPs and underserved communities.
Our new strategy defines four distinct but complementary roles for Connect Humanity:
We are matchmakers
At the core of our strategy is our role as a matchmaker in the intersection of 1) underserved communities lacking broadband connectivity 2) community-focused ISPs who build and operate infrastructure, and 3) investors and funders with the capital to get networks built. These parties need each other but don’t always have the relationships, common language, or aligned incentives to collaborate effectively.
As a trusted advisor, we break down barriers and create strong partnerships that advance digital equity. Like in Macon County, Alabama where we worked with the right partners to unlock funding to build a fiber network expanding broadband to 1,400 additional homes and businesses in a community that had long been short changed on broadband investments, ensuring the deal was structured in a way that protected the interests of local residents. We’re pleased to report that investing in fiber in Macon County is already bearing fruit. This network has helped attract two new businesses to the community: a new auto parts manufacturing facility as well as a partnership between Tuskegee University and telehealth company OnMed. This is just the beginning of what will be a game-changing investment for residents in Macon County.
We are investors
Investing is at the heart of what we do as a nonprofit impact fund, pioneering new models to sustainably and profitably finance community-focused ISPs on terms they and the communities they serve can afford.
Over the next two years we will grow our portfolio of community broadband investments, providing low-cost, tailored capital to community-focused ISPs. We aim to launch flagship Funds like IDEA (Investing in Digital Equity in Appalachia) in partnership with Appalachian Community Capital to invest in underserved communities across the region. And the Texas Border Small Business Broadband Fund for the digitalization of enterprises in South Texas.
We catalyze capital
Building broadband is a capital intensive business, and with 42 million Americans lacking internet access — and many more people globally — the need is huge. To grow the capital available for this work, we will significantly expand our efforts to mobilize other funders to invest in community-focused ISPs. We’ll do this by continuing to share our investment strategies and demonstrate that community broadband is a viable, profitable asset class. While traditional broadband providers have written off large swaths of the country, we’re showing investing in underserved areas can be done sustainably, tracking a 9.4% IRR on our investments to date. The blended finance stacks we leverage in our investments are not just essential for making deals come together, but enable many more actors to participate in ending the digital divide.
We advocate for community broadband
As an impact investor for digital equity we often hold unique insight into the policies and practices that can expand broadband in underserved communities. Building on early success on initiatives like documenting financing models for community broadband, crowdsourcing data on digital equity from global civil society, and campaigning for a fix to US funding rules, we’ll double down on building knowledge and driving policy change that can level the playing field for community broadband.
Three years into the pandemic, billions of people globally still lack the connectivity they need to participate fully in today’s world. The urgency to close the digital divide grows daily as more services shift online and technologies like AI become everyday tools for those lucky enough to have them. We can end this inequity if we choose to.
As Brian Vo, our Chief Investment Officer, puts it: “It’s possible to build gold-standard internet service in rural and low-income communities. When willing partners come together to invest, we can build networks that meet the needs of families and businesses — and that are financially sustainable over the long term.” This is what our new strategy is about.
We’ll continue to evolve how we work in the months and years as we learn from our peers, partners, and the communities we serve. Have comments, ideas, or feedback on this strategy?
I’d love to hear from you. Reach me at email@example.com.