$5 Million for Minority-Owned Small Businesses
Builds on Successes and Insights from the original Detroit Fund
Building on the success of Detroit’s Entrepreneurs of Color
Fund, JPMorgan Chase today announced it will expand the fund’s
model and create two new funds to help minority entrepreneurs in
San Francisco and the South Bronx. The firm is committing more than
$5 million across the two cities to provide minority entrepreneurs
with critical access to capital, while also recruiting additional
investors to the new funds.
As part of JPMorgan Chase’s $150 million Small Business Forward
program to help women, minority and veteran entrepreneurs, the firm
will invest $3.1 million in San Francisco and $2 million in the
South Bronx, with the goal of helping local minority-owned small
business share in the growth of these two cities. The firm recently
doubled the size of Small Business Forward from $75 million as part
of a $20 billion, five-year U.S. investment that includes
increasing the firm’s small business lending commitment and
community investments to drive inclusive economic growth.
“Detroit’s Entrepreneurs of Color Fund has made a great impact
creating economic opportunity, and now we want to bring this same
model to San Francisco and the South Bronx to help more
entrepreneurs grow,” said Jamie Dimon, Chairman and CEO,
JPMorgan Chase. “These cities are seeing tremendous growth. By
expanding this fund, we will help ensure more small businesses
thrive and create local jobs.”
Applying Insights from Detroit
Two years ago, JPMorgan Chase, along with W.K. Kellogg
Foundation and Detroit Development Fund, created a $6.5 million
Entrepreneurs of Color Fund in Detroit to provide minority-owned
small businesses with access to capital and technical assistance as
part of the firm’s $150 million investment in Detroit’s economic
recovery. In December 2017, JPMorgan Chase and partners announced
the Detroit fund would triple in size to more than $18 million due
to the fund’s initial success, improving economic conditions in the
city and strong collaboration between civic, business and nonprofit
leadership.
Since its launch, the Detroit fund has lent or approved $4.7
million to 45 minority small businesses, resulting in more than 600
new or preserved jobs. Fifty-three percent of the loans are
supporting minority women-owned businesses and nearly
three-quarters (70 percent) of the loans have supported small
businesses based in Detroit neighborhoods.
As it did in Detroit, JPMorgan Chase is combining its
philanthropy and business expertise to help provide underserved
entrepreneurs in the South Bronx and San Francisco with access to
the capital they need to grow, create jobs and drive local economic
growth. Collaboration between community partners and the strong
need for access to capital prompted JPMorgan Chase to replicate the
Detroit fund and brings its model for impact to these
communities.
The new funds will provide underlying capital for community
lending partners to make loans and provide technical assistance and
personalized servicing. Many entrepreneurs will be in the start-up
stage of their business, but the funds will also support existing,
legacy businesses—allowing more businesses to stay local despite
threats like rising rents and higher operating costs. These
entrepreneurs are typically unable to qualify for traditional
loans, often due to previous credit challenges, limited financial
collateral, short business history or informal businesses
practices.
“Creating inclusive growth is a challenge facing cities all over
the world, and that’s especially true in places like San Francisco
and the South Bronx,” said Peter Scher, Global Head of Corporate
Responsibility, JPMorgan Chase. “We want to help more Americans
share in the rewards of a growing economy, and with this new fund
we will be able to share lessons from our work in Detroit and
create meaningful, long-term growth for underserved
entrepreneurs.”
Small businesses are key drivers of growth, and that growth is
fastest among minority and women entrepreneurs. A 2016 study by the
Institute for a Competitive Inner City shows that small businesses
in large cities account for a majority of jobs, but that number is
even bigger in inner city areas. In Detroit, small businesses
accounted for half of jobs within city limits—that number jumps to
two-thirds of jobs in Detroit’s inner city neighborhoods. That same
report also found that a modest increase in the number of jobs
created by existing small businesses could create enough employment
opportunities for all currently unemployed inner city
residents.
San Francisco Entrepreneurs of Color Fund
In San Francisco, Latino and Black-owned small businesses
received less than 10 percent of Small Business Administration
loans in 2015, while white entrepreneurs received 53 percent. Asian
or Pacific Islanders received 29 percent of loans.
JPMorgan Chase is bringing together Working Solutions, ICA Fund
Good Jobs and Pacific Community Ventures to help San Francisco
entrepreneurs of color start, stay and grow in the city. The
collaborative, which won JPMorgan Chase’s PRO Neighborhoods
competition, will provide loans and technical assistance, with
loans starting from $5,000 for start-ups and larger loans for more
developed small businesses.
The fund will also work closely with the new Chase Center in
Mission Bay to generate business opportunities and local economic
growth.
“Equal access to capital is a critical
tool in our efforts to create opportunity
and advance shared prosperity for all San Franciscans,”
said Todd Rufo, Director of the San Francisco Office of
Economic and Workforce Development. “It is especially
challenging for women and minority entrepreneurs to
secure access to loans and other forms of assistance. The
Entrepreneurs of Color Fund helps address this issue by
partnering with local organizations
and complementing the City’s programming aimed
at furthering equity in underserved
communities.”
“Working Solutions is thrilled to be partnering with JPMorgan
Chase and our fellow nonprofits ICA Fund Good Jobs and Pacific
Community Ventures to launch the Entrepreneurs of Color Fund in San
Francisco,” said Sara Razavi, Interim CEO and former COO of
Working Solutions. “Through this collaborative approach, we
will provide loans and investments along a continuum of capital –
with loans starting from $5,000 – to reduce the chronic
undercapitalization faced by entrepreneurs of color in our
community. Our goal is to meet entrepreneurs of color ‘where they
are’ with tailored resources and consulting to create sustainable
businesses, good local jobs, and thriving, inclusive neighborhoods
in San Francisco.”
In San Francisco, JPMorgan Chase has increased the number of
local branches, added employees and committed $25 million over
three years for Bay Area projects as part of the development of the
Chase Center. The new Entrepreneurs of Color Fund, along with these
existing business and philanthropic investments, will continue to
drive inclusive growth through skills training, the development of
affordable housing and small business investment.
South Bronx Entrepreneurs of Color Fund
In the Bronx, 80 percent of small businesses are owned by
entrepreneurs of color, and many struggle with being able to afford
the space and resources they need to run and grow their
businesses.
JPMorgan Chase is partnering with Excelsior Growth Fund and
Accion, two recent winners of JPMorgan Chase’s PRO Neighborhoods
competition. The PRO Neighborhoods investment facilitated the
development of a loan management infrastructure that the
collaborative will leverage to create tailored solutions, including
flexible small business loan products. The Entrepreneurs of Color
Fund will also offer technical assistance and education to
businesses. CommonWise Education, a network of grassroots local
leaders, labor leaders, and anchor institutions whose mission is to
end generational poverty in the Bronx will help to inform the
design of the fund.
“The Bronx has seen an ongoing revival over the past decade,
thanks in part to strong partnerships between our business
community, non-profits and the public sector,” said Bronx
Borough President Ruben Diaz Jr. “Today’s announcement that
JPMorgan Chase will launch an ‘Entrepreneurs of Color’ Fund in the
South Bronx is a welcome one, as it will help provide minority and
women-owned business enterprises with the resources they need to
grow and thrive. I especially want to thank Jamie Dimon for his
commitment to the continued success of The Bronx, and his welcome
investment in the health and well-being of our critically important
minority-owned businesses.”
“When everyone - regardless of race, gender or ethnicity - has
access to resources they need to become economically empowered,
cities and the country as a whole will reap the benefits of their
success. I applaud JPMorgan Chase for expanding resources to
empower minority entrepreneurs in two major cities, including New
York City,” said Jonnel Doris, Senior Advisor and Director of
the NYC Mayor’s Office of Minority and Women-owned Business
Enterprises (M/WBEs). “These resources will help break historic
barriers that have hindered the economic success of these
businesses and will continue to make New York City the fairest big
city in America.”
“We applaud JPMorgan Chase for their leadership in driving and
funding this initiative, and bringing together partners that are
well-equipped to create lasting change for businesses in the South
Bronx,” said Steven Cohen, President of Excelsior Growth
Fund. “As an alternative nonprofit lender and Community
Development Financial Institution, Excelsior Growth Fund has a
mission to provide capital to underserved small businesses, and
thanks to this initiative there is now increased support available
for entrepreneurs of color in the South Bronx.”
JPMorgan Chase is the largest bank in the South Bronx, with
thousands of employees living there and hundreds working in the
borough. Over the past few years, the firm has invested more than
$17 million in small business growth, skills training for young
people and the development of affordable housing.
Anyone with questions about how to invest in the funds is
encouraged to contact Excelsior Growth Fund (South Bronx) at
646-465-8186 or Working Solutions (San Francisco) at (415)
655-5442.
Companies interested in applying for the funds in South Bronx
should visit www.ExcelsiorGrowthFund.org and those in San Francisco
should visit www.entrepreneursofcolorfundsf.org.
About JPMorgan Chase & Co.
JPMorgan Chase & Co. (NYSE: JPM) is a leading global
financial services firm with assets of $2.5 trillion and
operations worldwide. The Firm is a leader in investment banking,
financial services for consumers and small businesses, commercial
banking, financial transaction processing, and asset management. A
component of the Dow Jones Industrial Average, JPMorgan Chase &
Co. serves millions of customers in the United States and many of
the world's most prominent corporate, institutional and government
clients under its J.P. Morgan and Chase brands. Information about
JPMorgan Chase & Co. is available at www.jpmorganchase.com.
About Excelsior Growth Fund
Excelsior Growth Fund (EGF) helps small businesses grow by
providing streamlined access to business loans and advisory
services. EGF’s signature product, the EGF SmartLoan™, provides up
to $100,000 in fast, transparent, and affordable financing through
a secure online platform. Larger loans up to $500,000 are also
available. EGF is a nonprofit organization and is certified by U.S.
Department of Treasury as a Community Development Financial
Institution (CDFI). Learn more at www.excelsiorgrowthfund.org. As
an affiliate of New York Business Development Corporation
(www.nybdc.com) and The 504 Company (www.the504company.com), EGF
can also facilitate access to a full suite of alternative financing
products.
About Working Solutions
Working Solutions is a Community Development Financial
Institution (CDFI) with a mission to provide affordable microloans,
customized business consulting, and community connections to
start-up and early-stage businesses seeking loans from
$5,000-$50,000. Working Solutions prioritizes serving disadvantaged
entrepreneurs with limited or no access to traditional financing,
especially low- and moderate-income individuals, women, and people
of color. Since the launch of Working Solutions’ lending program in
2005, Working Solutions has made more than 500 microloans totaling
over $15 million with a 96 percent repayment rate to businesses
that have created or retained at least 2,600 jobs in the local
community. More information is available at
www.workingsolutions.org.
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JPMorgan Chase & Co.Caitlin
LegackiCaitlin.a.Legacki@jpmorgan.com
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