A guide to investing in Black economic mobility - The McKinsey Podcast Recap

Podcast: The McKinsey Podcast

Published: 2023-03-23

Duration: 1873

Guests: Shelley Stewart III, Asaf Somekh

What Happened

Shelley Stewart III, a senior partner at McKinsey, discusses the significant digital divide affecting Black American households, where 40% lack high-speed, fixed broadband. This digital divide is one of eight critical areas with potential for investment to improve Black economic mobility, alongside financial inclusion and health equity.

Stewart highlights the 8x wealth gap between Black Americans and white Americans, noting that financial inclusion can be hampered by historical distrust in financial institutions and lack of access to convenient banking services. He points out that digital platforms could offer investment opportunities to address these issues by providing more accessible banking and credit products.

Health equity is another focus, with Stewart mentioning that 3 million more Black Americans would be alive today if healthcare disparities were eliminated. Issues such as access to healthcare, insurance coverage, and bias in medical treatment are identified as key contributors to these disparities.

Investors have opportunities to address health equity by investing in food supply chains to combat food deserts, developing drugs for conditions more prevalent in Black populations, and expanding digital health services to bridge access gaps.

The episode also touches on the role of broadband infrastructure as an enabler for addressing wider economic challenges. Investment in broadband is crucial for improving access to education, healthcare, and financial services in underserved communities.

Asaf Somekh, CEO and co-founder of Iguazio, discusses the challenges of moving AI projects from the lab to real-world applications. He explains that many enterprises face 'pilot fatigue' due to the difficulty in scaling AI projects beyond initial testing phases.

Somekh emphasizes the importance of MLOps (Machine Learning Operations) in overcoming these challenges, suggesting that integrating AI development with traditional software lifecycles can reduce inefficiencies. He notes that tech giants have addressed these issues by creating extensive infrastructures, which smaller enterprises often cannot afford.

Key Insights

• 40% of Black American households lack high-speed, fixed broadband, a significant digital divide impacting economic mobility opportunities. Investment in broadband infrastructure is seen as a critical step to closing this gap.
• The wealth gap between Black Americans and white Americans is 8x, driven partly by a lack of access and trust in financial services. Digital banking platforms present investment opportunities to improve financial inclusion.
• Health disparities result in roughly 3 million fewer Black Americans being alive today compared to if healthcare were equitable. Investment in food supply chains and digital health services could help close these gaps.
• Many AI projects remain in the pilot phase, with only 10% moving beyond the lab. 'Pilot fatigue' occurs due to siloed development processes, which MLOps aims to resolve by integrating AI with existing software practices.