When Chambers joined Clubhouse in October, the demographics in many of her rooms-of-choice reflected the White, male-dominated venture capital industry.
“I found out it wasn’t the safest space for Black women to speak or be heard on financial topics,” she said.
Chambers’ club is an offshoot of a syndicate she started for Black women investors. “We have to take some high risks and make the investments that maybe are a little bit more risky than conservative because we are playing catch-up,” she says.
However—while Clubhouse users can report accounts if they exhibit suspicious behavior and those accounts can potentially be suspended—risks abound for those who aren’t careful about who and what they are listening to.
As people increasingly turn to social media platforms as a source of tips for managing their money, and an ever-expanding pool of users offer such content, it’s becoming harder to separate reasonable lessons from ideas that are misinformed and potentially catastrophic for personal finances.
Investing in assets such as equities and Bitcoin can be risky, and several studies have shown that stock picking fails to beat the broader market over the long run, even when done by finance-industry professionals. Earlier this year, New York’s top law enforcement officer warned consumers about the susceptibility of the cryptocurrency market to “speculative bubbles” and abuse by criminals.
Mac says he hears misinformation on Clubhouse every day. Black Wealth Matters issues a disclaimer on its homepage and the hosts often repeat it audibly, notifying listeners that their advice is for informational use only.
One of Chambers’ club’s mottos is “no hype, just facts,” she said. Black Women Who Invest also issues a disclaimer on its homepage.
Outside of clubs like Chamber’s and Mac’s, Clubhouse also hosts conversations by an expanding number of Black cryptocurrency evangelists with tens of thousands of followers.
Black Bitcoin Billionaires is the largest cryptocurrency group on the app with about 51,800 followers. The group has a partnership with Square Inc., where the company sponsors Bitcoin giveaways for members through its Cash App.
Lamar Wilson, co-founder of Black Bitcoin Billionaires, said when he first read a public technical guide to Bitcoin, the currency to him symbolized freedom from an oppressive financial system.
“All it did was represent the opposite of what goes on in this county,” Wilson, 41, said. “They say we’re a capitalist society, yet they always bail out the biggest ones of us and don’t allow the little guy to compete.”
Niles Stewart, 23, started investing in Bitcoin—despite disapproval from his father—while studying at DePauw University. The founder of Black Crypto Talks says he now has more assets in cryptocurrency than in cash.
“African Americans have had to rely on self-help and self-determination because the institutions are not serving them,” Garrett-Scott of the University of Mississippi said. “At the same time, it’s like a double-edged sword. It cuts both ways. There’s opportunity and risk in the same moment.”
In an ideal world, Garrett-Scott said Black Americans would be able to take advantage of existing opportunities to build wealth instead of working around barriers.
“It is my hope that people will continue to keep this spark of Black entrepreneurship and Black capitalism alive in these new digital spaces because these are spaces that weren’t created for us,” Garrett-Scott said.
—With assistance from Charlie Wells.
This article was provided by Bloomberg News.