Wells Fargo Invests $18.5 Million in Grants to Ease Small Business Stress and Expand Access to Capital
Latest Diverse Community Capital funding helps diverse small businesses start and grow across U.S., including Puerto
Rico
Wells Fargo announced $18.5 million in grants today to nine Community Development Financial Institutions (CDFIs) so they can
unlock capital or increase training to
diverse small businesses across the U.S. Two CDFIs are receiving awards to continue their work supporting entrepreneurs in
Puerto Rico, which is still recovering from the aftermath of Hurricane Maria.
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Celeste Phillips started her small business, Big LuLu’s Trucking LLC, with the help of Bridgeway Capital and Wells
Fargo’s Diverse Community Capital program. (Photo: Business Wire)
The latest round of funding is part of the company’s ongoing Wells Fargo Works for Small Business: Diverse Community
Capital program, which was created to empower diverse small business owners with a $175 million
commitment through 2020. Since its inception in 2015, the program has awarded $94.8 million to 92 CDFIs in rural and urban
areas. According to Opportunity Finance Network (OFN)’s evaluation of the first phase of the program, diverse small business
borrowers from the first 44 CDFI awardees have already created and sustained more than 45,000 local jobs as a result of accessing
capital and development services.
“Small businesses are essential to a vibrant community, no matter where you live,” said Connie Smith, Wells Fargo’s Diverse
Community Capital program manager. “These ‘activator grants’ are designed to drive inclusive economic growth and significantly
scale resources that help underrepresented entrepreneurs grow and stay resilient in the face of economic challenges. CDFIs are such
an important partner in cultivating small business growth, and the recipients in this round have a long track record of success and
leadership in the communities they serve.”
The Diverse Community Capital grant recipients are:
- Accion, Inc. ($2.7 million): Based in Albuquerque, N.M. and serving five states in the
southwest and mountain west, Accion will utilize its three-year grant to automate, market and scale an innovative loan product,
Presto Loan, that has the potential to reach significantly more diverse entrepreneurs across Arizona, Colorado, Nevada, New
Mexico and Texas. The product will offer loans up to $12,000, flexible underwriting criteria, affordable rates and a turnaround
time of fewer than three days.
- Carolina Small Business Development Fund ($2.8 million): The fund will seek to build minority
small business capacity in North Carolina through expanded relationships with historically black colleges and universities. The
grant also will be used to introduce an online development resource for more than 300 entrepreneurs interested in starting or
growing a business.
- Community Reinvestment Fund ($2.7 million): This Minneapolis-based nonprofit will expand
access to capital for diverse small business owners by investing in two technology platforms — Connect2Capital® and SPARK.
Connect2Capital will help reach and match entrepreneurs with the CDFI that best meets their needs and SPARK will help build the
capacity of mission-driven lenders by providing a scalable, secure and streamlined loan origination process. Connect2Capital
alone will aim to close more than 1,000 loans and distribute $50 million in capital over three years.
- Hope Enterprise Corporation (HOPE) ($2.8 million): This seasoned CDFI focuses on building
assets and improving lives in the Deep South, specifically in persistent poverty counties in Alabama, Arkansas, Louisiana,
Mississippi and Tennessee. With its grant, HOPE will provide technical assistance and credit-enhanced loans for more diverse
small business owners. As a result of accessing needed capital, more high-quality jobs will likely be created and retained.
- Main Street Launch ($2 million): Based in Oakland, Calif., Main Street Launch will activate an
African American Entrepreneurship Institute, offering intensive training to prepare more businesses for success and building
wealth. Topics will include business critical areas such as ecosystem building with community partners, supply chain
effectiveness, operational readiness, financial education and succession planning.
- Metropolitan Economic Development Association ($1.5 million): The nonprofit CDFI will pilot
and expand its bank enterprise system to create more access to loan capital for diverse small business owners across the Midwest.
Over three years, the association plans to administer $50 million in loans and share best practices from its system with fellow
CDFIs in the region and nationally.
- Self-Help Ventures Fund ($1.5 million): This nonprofit loan fund, based in Durham, N.C., will
design a new line of credit for diverse developers as a way to fuel real estate and construction growth in Chicago and in North
Carolina. The developer line of credit will allow minority entrepreneurs to more easily purchase a property and have capital to
complete renovations. The grant will also support contractors, including African American, Latino, women and veterans, who want
to grow their businesses.
- Local Initiatives Support Corporation ($1 million): The organization will focus on stimulating
economic recovery in underserved communities in Puerto Rico that were deeply impacted by Hurricane Maria. A Kiva microcredit
matching loan fund will be created to support entrepreneurs and small businesses, and credit-enhanced loans will be available for
larger projects. LISC will also develop its organizational capacity and networks for responding to future natural
disasters—supporting small businesses as part of broad economic recovery efforts.
- PathStone Enterprise Center, Inc. ($1.5 million): Based in Rochester, N.Y., the Center will
deploy its grant towards small business recovery efforts in Puerto Rico. With its long history of working with the Puerto Rican
community regionally and through its office in Ponce, Puerto Rico, the Center plans to establish a revolving loan fund with more
flexible terms to help stabilize small business owners and embed resiliency planning against future economic challenges.
The Diverse Community Capital program is a collaboration between Wells Fargo and
Opportunity Finance Network, a national network of CDFIs. Opportunity Finance Network offers a social capital component of the
program to focus on helping CDFIs grow stronger through activities including in-person networking, mentorship, consulting and peer
learning. According to Opportunity Finance Network, Diverse Community Capital awardees have closed more than $393 million through
more than 8,000 loans to diverse small business clients, including African American, Latino, American Indian, women, and veterans,
among others.
“Over the past three years, OFN has been privileged to work with the talented individuals at the many CDFIs that
have received Diverse Community Capital Program awards from Wells Fargo,” said Donna Fabiani, executive vice president of Knowledge
Sharing at Opportunity Finance Network. “We congratulate the new Activator Award recipients and are eager to see how far they
will take their diverse small business lending with the help of these new awards.”
About Wells Fargo
Founded in 1852 and headquartered in San Francisco, Wells Fargo & Company (NYSE:WFC) provides banking, investment and
mortgage products and services, as well as consumer and commercial finance, through 7,800 locations, more than 13,000 ATMs, and the
internet (wellsfargo.com). Wells Fargo’s vision is to satisfy customers’ financial needs and help them succeed financially. With
approximately 259,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was
ranked No. 26 on Fortune’s 2018 rankings of America’s largest corporations. In 2018, Wells Fargo donated more than $444 million to
nearly 11,000 nonprofits in support of affordable housing, small business growth, financial education, and sustainability, among
other community needs. For 10 consecutive years, Wells Fargo has held the honor of No. 1 in workplace giving by United Way
Worldwide. Wells Fargo team members also make a difference by donating more than 2 million hours of volunteer time in the last
year. News, insights and more information on the company’s corporate responsibility are available at
Wells Fargo Stories.
Media
Kim Erlichson, 201-463-4243
kim.erlichson@wellsfargo.com
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