About ImpactPHL Perspectives:

ImpactPHL Perspectives is a multi-part content series that explores the many facets of the impact economy in Greater Philadelphia from the perspectives of its doers, movers, shakers, and agents of change. Each volume is written directly by a leader in this space to discuss best practices and share lessons learned while challenging our assumptions about financial and impact returns. For more thought leadership like this, check out the full catalog of ImpactPHL Perspectives.

Chris Bentley, Managing Principal at The De-Carceration Fund

The US Criminal Justice System directly impacts 6.6 million people costing more than $80 billion annually. Racial disparities, extractive business practices, and misaligned incentives mar this profoundly broken system. More than 4,000 corporations profit from mass incarceration through predatory pricing, prison labor, and the private prison industry, according to research conducted by the Prison Policy Initiative. However, the opportunity exists to find highly innovative private sector business models that address the injustices of mass incarceration, poised for the ethical disruption of the Criminal Justice System.

“More than 4,000 corporations profit from mass incarceration through predatory pricing, prison labor, and the private prison industry, according to research conducted by the Prison Policy Initiative.“

How can we make investment decisions that will influence long-term justice system reform and end incarceration's revolving door? The De-Carceration Fund is trying to do just that. This impact fund will invest in and support highly innovative enterprises working to eliminate the suffering caused by the US Criminal Justice System. It will accomplish this through a radically different fund model focusing on returning power and agency to those from whom it has been taken.

In our theory of impact, we break the total system into three main goals.

Prevent Entry - Reduce the number of individuals entering the system
Reduce Suffering - Reduce the negative impact on individuals and families impacted by the system
End the Cycle - Support a successful transition out of the system.

We can identify many issues that lead to poor outcomes as we evaluate each area.

A high-level summary of some of those issues can be found below:

Often, we attempt to solve these problems by looking to political solutions, philanthropic work, or a market-driven approach. We must design systems incorporating all three tools to address these solutions completely and sustainably.

“One of the single most significant predictors of recidivism is employment. Six hundred fifty thousand people are released from prison annually, and 75% of those are still unemployed one year after release.“

Employment

One of the single most significant predictors of recidivism is employment. Six hundred fifty thousand people are released from prison annually, and 75% of those are still unemployed one year after release. According to the advocacy group Prison Policy Initiative, formerly incarcerated people are unemployed at over 27%, higher than the total U.S. unemployment rate during any historical period, including the Great Depression.

Nonprofit Solution

The Philadelphia area has many reentry services provided by many organizations. A 2019 assessment of the reentry landscape in Philadelphia surveyed 118 programs from 71 organizations. Most of these organizations have excess capacity and could serve more individuals. The reentry services ecosystem comprises many small programs and small organizations. Sixty-five percent of organizations serve fewer than 1,000 people annually, and more than half of the programs serve 500 or fewer people annually. As a result, the practices of tracking impact and outcomes are inconsistent. Participant information is collected but frequently not stored electronically or updated regularly, and often the most critical outcomes are not tracked at all. For example, only 42% of programs collect information about recidivism, 27% update that information regularly, and only 22% store the information electronically.

Policy Solution

The City of Philadelphia Department of Commerce has created the Fair Chance Hiring Initiative (FCHI), which supports local businesses by providing financial incentives to businesses through wage reimbursements and employment retention grants. Incentives include a $6.00 per hour wage reimbursement for compensable hours worked up to 960 hours within 180 days of employment. In addition, the company receives a one-time $500 employment retention grant for each FCHI employee that completes the new hire period. Employees also receive a one-time, taxable $1,000 employment retention grant for completing the new hire period and support and help to maintain employment. Whether an incentive program is successful or unsuccessful will depend on the data relied upon and the methodology used to evaluate the program.

Private Sector Innovation

Since 2020, the De-carceration Fund portfolio company, Untapped Solutions, has revolutionized the reentry process by instantly connecting formerly incarcerated people with services. Untapped Solutions provides the justice-impacted community with resources and tools to make a successful reentry plan and create a pathway toward professional employment or opportunities through networking and building professional connections.

When Andre Peart left the Bare Hill Correctional Facility in 2018, he didn’t have anywhere to go. Having spent almost six years incarcerated, he missed most of the technology updates that shaped the world he was stepping into. He walked out of his sentence with $40 in gate money and a bus ticket to a homeless shelter. He started applying frantically for jobs, with no success. “My bachelor’s degree didn’t matter, my past education in journalism didn’t matter, my previous experiences didn’t matter. I would get turned down the minute they knew about my time in prison.” Peart then founded Untapped Solutions.

Employers can create their homepages and actively recruit talent via Untapped Solutions. The product is designed to expedite the recruitment and hiring process between employers and people in the Criminal Justice System to help ensure employment's social and economic stability.

Untapped Solutions is a case worker management system for non-profits that allows reentry organizations to onboard new clients. As more and more non-profit organizations get onto the platform, the opportunity exists to share data around impact and allow employers access to a larger population of new candidates. This can both improve outcomes from the non-profit sector and improve policy efficacy.

Ethical Disruption

In the pursuit of addressing the deeply broken US Criminal Legal System and combating the injustices of mass incarceration, the De-Carceration Fund presents a powerful solution. By investing in and supporting highly innovative enterprises working to eliminate the suffering caused by the system, the fund aims to achieve three main goals: preventing entry, reducing suffering, and ending the cycle.

The De-Carceration Fund's portfolio company, Untapped Solutions, stands as a prime example of private sector innovation, revolutionizing reentry by connecting formerly incarcerated individuals with services instantly, creating pathways towards professional employment, and promoting social and economic stability. Through a collaborative approach that incorporates political, philanthropic, and market-driven solutions, we can pave the way for a more sustainable and inclusive future, returning power and agency to those impacted by the criminal legal system.

Chris Bentley has over 15 years of experience in impact investing. Chris is the Managing Principal of the De-carceration Fund. Before that, he was an Investment Manager at Serious Change Investments, an early-stage impact venture fund founded by Impact Investment pioneer Josh Mailman.