Killer Mike: ‘We’re going to have to invest in America in a way we have not since World War II’

Michael “Killer Mike” Render, Greenwood Co-founder, Rapper and Activist joins Yahoo Finance’s Zack Guzman to discuss the launch of his digital banking platform Greenwood and more.

Video Transcript

ZACK GUZMAN: 2020 has been a banner year for discussions on racial inequality in this country, from criminal justice reform to the fact that Black and brown unemployment rates remain historically higher than the white unemployment rate here. There's no shortage of data you can point to, to show that progress has been slow in rectifying what many say is a systemic problem here in the US.

But rather than just talk about that problem, Grammy Award-winning musician and entrepreneur Michael Render, AKA Killer Mike, is teaming up to launch Greenwood, a new digital bank focused on serving the Black community. And he joins us now.

And I appreciate you taking the time to chat about this here because it's a very important issue, and it's one, I think in the banking community, we're seeing discussed more and more. Just recently, we saw JP JPMorgan Chase come out with a $30 billion initiative to focus on racial inequality within communities of color here. So talk to me about why you think launching this digital bank is a better way to go for impact.

MICHAEL "KILLER MIKE" RENDER: Thanks, Zack, for having me here, first. Greenwood is the future of banking. And not just for the Black and brown community, it's the future of banking for those that are unbanked. And we have far too many people that where brick and mortar banks have left traditional neighborhoods, have had to depend on check cashing places, or even liquor stores and things that would gouge people $0.20 to $0.25 on the dollar just in order to use their money.

So they never have 10% or 20% of their savings. They never have the ability to grow wealth, to buy their first home. Because they aren't banking with a real bank. They're not getting a chance to establish credit. They don't get financial literacy until it's much later in life.

So you have people that could have been buying a home at 25, 30, now are buying a home at 45 and 50. So that means we've wasted 20 years of potential customers and provided stability to neighborhoods.

So what Greenwood does is bring your banking platform directly to your phone. It doesn't hit you with hidden fees and occurrences. It also helps the working person. I remember working at AutoZone having two kids when I was younger. If I needed to pay my rent on Wednesday, and I don't get paid till Friday, you can get your pay two days early.

So it really helps. It comes in the market, helping the unbanked, helping the working class kid that's working their way up to stability and real adulthood. And I think that's needed.

Now it's going to grow into a lender, automobile and mortgage lender. And the ultimate aim is to grow into a capital lender for businesses that are from the creative community and that are traditionally underfunded, which are Black and brown businesses.

They have a harder time raising capital. They're turned down on a 21%-- their loans get turned down at 21% versus 8% from some of their white counterparts. It's almost equal. You know, the applications are equal. So there's a need to fulfill this niche. And Greenwood is stepping in to do it.

ZACK GUZMAN: Yeah, I'm glad you mentioned those issues, too, because it's something we've talked about, whether it's home ownership or, as you're talking about, just accessing loans in general. It's much harder sometimes for communities of color even keeping statistics constant across the applicants here.

You yourself have talked about that as a business owner-- I mean, the initiative there in making it easier to deal with banks. You talk about dealing with local banks that care versus some of these big four names that we talk about, larger institutions.

But some people might say, look, it seems like it would be a simple decision for business owners. They're just going to go with the bank that gives them the best rate. You've talked about the value that people apply in working with that community mission, so talk to me about why that's more important than maybe just the numbers on paper.

MICHAEL "KILLER MIKE" RENDER: Well, the numbers matter, which is why Greenwood is coming in competitive, right? They're coming in, waiving traditional fees. They're coming in where you know that the percentage that you pay, we use an ATM percent. They know that you know that a percentage of their money goes directly back into the United Negro College Fund and NAACP, which have helped Black people to have a step up here for 100 years.

Well, why does that step-up matter? That step-up matters because directly after slavery, Jim Crow laws happened. So for about 80, 90 years or so, you had Jim Crow laws that will restrict you from where you could live, where you could do business, who you can engage with business with. You had redlining. Blacks did not get the opportunity to have the GI Bill. Redlining happened in Atlanta until the late '80s, I found out.

So their property was undervalued. So they never had a proper shot at. It's like playing the Negro League before the Major League opened up. You had all these tremendous athletes that were playing in this other league that would never get to play Major League Ball, because the opportunity wasn't there.

What this does is give them opportunity to be there, be present in the game. And what I argue is that Greenwood helps the individual become stronger financially, which helps build stronger financial stable communities, which add to beyond the numbers, beyond what is the loan and what-- it adds to the niche of needing to understand businesses that are growing out of their community.

I own a barbershop. If I was trying to open Supercuts or Sports Clips, it'd be easy for me to go to a bank and say-- well, not easy, but it'd be a less difficult gig of saying, I have a model. It's just like Sports Clips. This is why it would work. And they say, OK, well, we've seen Sports Clips work. Now we understand.

But if I go to a bank and say, hey, I'm an entertainer. Companies like Nike, Reebok, will pay me to do this. Instead of doing that, I'm going to circumvent that. I'm going to create this whole thing myself. It's a barbershop, but Black guys get their hair cut every week, not every month or every two months. And Black guys have a propensity to buy stuff like sneakers and sneaker cleaners. So we are really a retail shop masquerading in a barbershop.

This bank is going to better understand that than, say, one of the big four. Because all they know is Sports Clips and Great Clips and Supercuts. We need that nuance, that subtle nuance, in the market because it's regional banks, oftentimes, that are funding your local gas stations, your local stores that grow into things like the QTs and even the Walmarts.

If it wouldn't have been for small regional banks that believed in them, we wouldn't be here. [AUDIO OUT] the Bank of Italy, which was created by immigrant Italians that were coming into Ellis Island, we would not have the Bank of America, which it grew into.

ZACK GUZMAN: Yeah, I mean, when you talk about that, too, it's pretty loud and clear that the issue of putting the community mission first-- and I know this might be a shift, but I want to stick with that theme here. Because putting the community mission ahead of your own interests is something we're seeing now play out on a tax policy question here as well.

Another musician here weighing in on it, and 50 Cent coming out and tweeting and talking about that potential 62% tax rate when you consider the city, the state, and the federal tax rate here under a Joe Biden plan here, attacking it, saying that he seemingly backed Trump there, despite his take that Trump, quote, "doesn't like Black people" here.

I know you're a Bernie guy, but it [AUDIO OUT] fly in the face of community interests being put ahead of economic interests here. So how do you react to his take on that and kind of weighing personal interests versus missions interests?

MICHAEL "KILLER MIKE" RENDER: So let me start off by saying that it doesn't have to be versus. But in matters of tactics, I just wish Democrats had have went with Bernie. But ultimately, the ideal solution for getting us out of here in terms of the government is going to have to employ people. We're going to have to invest in America in the way we did not since World War II. All those were things that was on his plan anyway.

And in matters of taxation, I pay about a 44% tax rate now. I was living under a Bernie or any other person that was willing to give to social programs of investing, of education, trade school, things of that nature, I would have given an extra dime to $0.15, and I would have understood why, because I would have known it was going directly into planting the seeds that will grow America the next 20, 30 years.

But I understand every person of means does not feel that way. So although I may disagree in terms of the candidate, because I would have rather my God born, because I knew what was happening on the frontend, I'd feel like it's a little duplicitous to come on the backend and borrow some of Bernie's policy and use to win when we could have just had Bernie.

But in matters of 50 Cent, that's 50. That's pretty consistent with 50. 50 grew up poor in Queens. 50 has established and worked his butt off to get what he has. It's like that Jerrod Carmichael skit where he finally makes it in comedy and gets rich, and his white friends want him to go vegan and not wear a Rolex. And he's like, shit. So you have to understand where people are coming from, too.

I met with my tax attorney about a month ago. And they said, Michael, we have some people that are content with $5 million. That's fine for them, and they're figuring out living the rest of their life. We have some people that have $150 million with us, and they hate to send any check to the government.

So I think that's the temperament of the person, more than speaking about all people. But people should know that that's the taxation rate for anybody making over 400 grand. And 400 grand doesn't make you rich. It usually just means you got a good ass job.

ZACK GUZMAN: No, it's very true. It's very true. But I appreciate you weighing in on all of that and bringing us the update there with the initiative over at Greenwood. Good luck with everything. And I encourage everyone to check out Michael's other talks here in terms of the activism and speeches that have been applied here, because it's really powerful stuff. But Michael Render, AKA Killer Mike, I appreciate you taking the time to chat.

MICHAEL "KILLER MIKE" RENDER: Thank you. Love and respect. Have a good day, Zack.