[Editor’s note: This is the first in a series of stories marking the 25th anniversary of Self-Help.]
By Ret Boney
DURHAM, N.C. — When Martin Eakes was in high school, his best friend and running mate on the student-body ticket, a black boy, was shot and killed on a playground behind Eakes’ home.
Eakes’ father had moved his family into a predominantly black rural community outside Greensboro, N.C., in 1965 in an effort to teach his boys the value of hard work.
“I felt like in the age I grew up, one has no choice but to become involved in issues of race and wealth if you have any social concern,” he says, and vowed the day his friend was killed “to live my life as if it were the two of us, not just the one of me.”
Four decades later, Eakes marks the 25th anniversary of Self-Help, the Durham-based community development bank he founded to begin closing the wealth gap between blacks and whites, poor and wealthy.
Today, Self-Help has almost $1 billion in assets.
It has provided about $3.9 billion in financing to help almost 44,000 disadvantaged people buy homes, start small businesses or fund nonprofits.
And it has spawned a sister watchdog group that polices mortgage and payday lenders that prey on vulnerable people.
“The goal,” Eakes says, “is to eliminate the huge wealth gap between rural and minority families compared to middle-class urban families.”
That’s a big job, given that the median net wealth for black families is $7,000, less than one-tenth the wealth of white families.
In 1980, Eakes, fresh out of law school, and his wife, Bonnie Wright, were trying to figure out “how can we best subvert the status quo and create opportunities for families that have been shunted aside.”
Their first project, helping a group of 500 displaced textile workers in New Bern save their factory, failed, but they had high hopes for helping seven of the workers start the community bakery they had dreamed of.
Eakes scoured the banking landscape for a $1,700 startup loan for the men, and when no one would take the risk, he took a look at his $7,000 annual budget and cut them a check for $1,700.
The first capital infusion for Self-Help came from a cake raffled for $77 at a bake sale, and so a financial institution was born.
“Now we’re $1 billion in assets,” says Eakes. “Almost 13 million bake sales later.”
Since then, Self-Help has gone on to build residential and small-business lending programs that cater to people mainstream banks consider too risky, and a secondary-market financing program that allows mainstream banks to lend to more people with non-traditional credit histories.
Self-Help also lends to foundational community organizations like daycares, health clinics and charter schools, rehabs and rents buildings in downtown Durham, and is leading the fight against predatory lenders that cheat poor people out of the little wealth they have.
“Self-Help has demonstrated the potential of a well-heeled nonprofit that has the intellectual capital, financial capital, the relationships necessary to have significant impact,” Abdul Rasheed, former board chair for two decades and CEO of the N.C. Community Development Initiative, says of the group.
Tom Lambeth, senior fellow with the Z. Smith Reynolds Foundation in Winston-Salem and an early funder of Eakes, agrees.
“For a lot of people in the nonprofit economic empowerment arena, it is such an example of nontraditional entrepreneurial success that it’s a benchmark for everyone wanting to do something in that field,” he says.
Self-Help now has just over 200 employees, affectionately characterized by Eakes as a “group of misfits.”
“It’s a brilliant staff,” he says. “They’re committed to changing the world. They’re attracted to public sector ideals, but have private sector skills. It means the organization is extremely entrepreneurial.”
Eakes’ mother used to tell him that if you have the vision to see a problem, you have to help solve it.
“My curse is that I see problems and solutions,” he says.
Other articles in series:
Part 2: Building wealth by boosting small business, communities.
Part 3: Increasing home ownership, the narrow pathway to the middle class.
Part 4: Protecting hard-earned wealth as important as creating it.