Connect Humanity partners with Appalachian Community Capital to raise $25M to bridge the digital divide
Connect Humanity and Appalachian Community Capital (ACC) have joined forces in a bold campaign to raise $25 million through IDEA (Investing in Digital Equity in Appalachia), aiming to bridge the digital divide throughout Appalachia, one of the least connected regions in the United States.
The lack is most acute in rural Appalachia, where one in four families lacks broadband access and only 25 of the 423 Appalachian counties were at or above the national average for connectivity, and these were all in metropolitan areas.
The collaboration between ACC, a Community Development Financial Institution (CDFI), and Connect Humanity, a nonprofit impact fund dedicated to digital equity, will create opportunities for local capital to invest in broadband infrastructure, including support for a community of local CDFIs, banks, impact investors and foundations dedicated to achieving digital equity in underserved communities across 13 Appalachian states.
The campaign builds upon the federal government's commitment of $42 billion to make high-speed Internet access available to all Americans by 2030. However, this federal funding alone is not enough to connect every American, and greater private investment will be crucial to achieving full connectivity. The IDEA Fund will support communities to raise the capital match required to apply for government broadband funds in addition to investing in communities that do not secure government grants.
IDEA leverages Connect Humanity's Appalachian Digital Accelerator, a program in partnership with the Appalachian Regional Commission, to empower 50 of the least connected communities in Appalachia. These communities will develop comprehensive plans to build broadband networks, enabling families and businesses to thrive in the digital economy. The plans communities create through the Accelerator will also help evaluate and de-risk subsequent investments.
Brian Vo, Chief Investment Officer of Connect Humanity, emphasized the need for private investment and philanthropy, stating, "The lack of high-speed access in marginalized rural communities has a negative impact on all aspects of life, from business to education, health, and job creation. The IDEA Fund can turn plans into reality and demonstrate how new models of community-centered networks can connect Appalachia."
Donna Gambrell, President and CEO of ACC, expressed her enthusiasm for Connect Humanity's support and their joint commitment to raising $25M and collaborating with ACC's 33 members on this initiative. Gambrell noted, “This partnership has the ability to unlock millions, if not billions, of dollars to connect the unconnected and transform the quality of life for millions.”
ACC, with its proven track record in promoting economic opportunity, is uniquely positioned to partner with Connect Humanity. Since 2015, ACC has deployed $32 million in leveraged debt, raised $17 million in grants, helped finance 121 small businesses through its members (including minority- and women-owned businesses), and generated or sustained over 2,000 jobs. This collaboration will help grow a community of funders in the region ready to invest in digital equity.
The first phase of the partnership will focus on raising and deploying the $25 million IDEA Fund to finance new broadband networks in unconnected and underserved areas in Appalachia. Investors will have the opportunity to participate directly in the IDEA Fund or as capital partners on individual projects.
Currently, community-focused internet service providers (ISPs) are best placed to connect communities in Appalachia. While they consistently deliver the fastest speeds at the lowest cost nationwide, they frequently lack access to sufficient capital. IDEA will fill this gap by providing capital in sizes and on terms that set networks up for success.
In the second phase of the partnership, ACC and Connect Humanity will collaborate on a technical assistance program to support Appalachian CDFIs in making direct investments in digital equity and emerging community-focused ISPs. The long-term goal is to integrate community broadband investments as a key part of CDFIs' portfolios.
The initiative seeks to demonstrate that community broadband is a viable investment and aims to ignite a wave of digital equity investors in the region.
Join us as we embark on an IDEA to connect Appalachia.
About Appalachian Community Capital: Appalachian Community Capital is a CDFI lending intermediary created to raise capital for its 33-member CDFIs and other mission-based lenders. The members, in turn, use ACC’s capital to fund small businesses in underserved areas in Appalachia, including businesses owned by women and persons of color. The members – many of which have been in operation for more than 20 years – and their affiliates manage over $2 billion in assets supporting economic development in Appalachia.
About Connect Humanity: Connect Humanity is a nonprofit impact fund advancing digital equity by investing in community connectivity providers. It helps underserved communities identify the right solutions to meet their connectivity needs and provides funding and technical assistance so they can build the internet infrastructure, tools, and skills they need to participate fully in a digital society.