Morris Clark and Otis Ellis, two former senior executives at Marathon Oil and JPMorgan Private Bank, are looking to address the digital divide that exists in the US by launching a new impact fund that will invest in broadband in underserved rural and urban areas.
“Two major, unforeseen events – the covid pandemic and the social unrest that followed the murder of George Floyd – really helped us highlight what we saw as a gap in the marketplace,” Clark, who served as vice-president and treasurer at Houston-based Marathon Oil between January 2014 and last July, told sister publication Infrastructure Investor.
“It was really this notion that that there is a lack of investment in those underserved communities,” he continued. “There’s a lack of investment particularly on the infrastructure side and more specifically on the broadband side. So, that’s kind of what brought us to where we are today,” he said.
Ellis, who most recently served as client advisor at JPMorgan Private Bank, added that, “having more than 30 years in the investment business, looking at what market forces dictate, and having been involved in community development, having worked with pension funds and non-profits, it just seemed like a natural fit to explore broadband more.”
The rise of digital real estate as an essential service has been underscored during the pandemic-related lockdowns.
“The digital divide has been around for a long time,” Clark said. “But it has particular meaning now as we go through this pandemic and seeing the impact something simple like whether or not you have access to broadband, can have on education, particularly for kids in underserved communities,” he added. “So, to us it became a moral imperative. It just became unacceptable that you can have, in the year 2020 and 2021, that digital divide.”
Clark and Ellis have not yet set a target for the Epiphany Community Impact Fund, but the goal is to invest across the US. “We’re evaluating opportunities now in the Southeast and Northeast regions,” Clark said. “But again, it’s early days, so that could certainly expand. But, initially, we do see it being US-focused.”
Asked whether the pandemic and the related lockdowns and travel restrictions might prove to be a challenge for fundraising, Clark said: “We really don’t foresee that being an obstacle. I would say quite the opposite. The current environment highlights the need for what we’re doing. We think we’re filling a niche.”
Ellis added: “We think the due diligence and the thoughtfulness with which we’re approaching the fund – patience is something we will need to be mindful of – we believe there is an opportunity for us to provide solutions to underserved communities.”
The fund will be managed by both Clark and Ellis. JR Chantengco, managing director of Black Pearl Investments, a New York-based boutique firm specializing in real estate, will serve as the fund’s capital advisor.
All three men are members of the Shreveport Economic Recovery Task Force in Louisiana, a coalition of local and national business leaders focusing on shovel-ready infrastructure projects that will help boost the city’s economy post-covid. The group’s Digital Infrastructure Committee is working with the Louisiana Federal Delegation, local and state educators, community groups and key stakeholders on bringing broadband access to cities and rural communities in the northern region of the state, according to a statement.