SBA finally meets DEI
V.1, N.22
Early stage entrepreneurs are often encouraged to get help from the U.S. Small Business Administration’s (SBA) Section 7(a) program. If you put your assets and house on the line, the SBA might guarantee a loan to your business for up to $5 million from a willing financial institution. But as our lead article from Oscar Perry Abello from Next City notes, this program has primarily benefited white men.
The SBA’s Fiscal Year 2021 report shows that only 18% of Section 7(a) loans went to women-owned businesses, 8% to Hispanic-owned businesses, and 5% to Black-owned businesses. Pre-pandemic numbers were just as bad.
To its credit, the SBA has been trying to remedy this problem. A few years back, it started the Community Advantage Program to leverage the financial assets of “mission-oriented lenders, primarily non-profit financial intermediaries that are focused on economic development in underserved markets.” Last month the SBA announced additional enhancements to Section 7(a) funding that should help improve its ability to meet “diversity, equity, and inclusion” (DEI) goals.
Thus far, 116 Community Advantage lenders have made 7,175 SBA guaranteed loans to businesses in distressed communities, totaling $968 million — with an average loan size of $134,912. More importantly, qualifying “non-profit financial intermediaries” can now include community investment funds financed by local investors. It’s but another reason your community should create these funds.
You will also find in this issue inspiring stories about a community food fund in Idaho, Fort Worth’s efforts to expand access to capital to its communities of color, and community investment in wind power in the United Kingdom.
Finally… ICYMI… check out our new website: TheMainStreetJournal.org to find an archive of past issues, an expanding roster of Main Street Champions, and our list of partners. Please join them!
– Michael Shuman, Publisher, The Main Street Journal
NEWS
Groundbreaking Small Business Loan Program Gets Long-Awaited Expansion, Next City (April 19)
Impact Idaho Fund Impact Investment Report 2021, Sun Valley Institute For Resilience (April 2022)
Fort Worth Gets a $3 Million Plan To Support Small Businesses, Next City (April 20)
Community-Owned Wind Turbines Used For Power Output, WION (April 18)
PARTNER VOICES
Community Wealth Building Toolkit, Democracy Collaborative (April 2022)
Putting Non-Extractive Finance Into Practice, Natural Investments (April 14)
Community Economic Development And Small Business Finance, The Kassan Group (April 11)
The Power Of Community Utilities, Democracy Collaborative (April 18)
EVENTS
Remaking The Economy: Closing The Racial Wealth Gap – Webinar. Thursday, May 5, 2-3:30pm ET. This 90-minute in-depth webinar, jointly organized by NPQ and Shelterforce, brings together four field leaders to discuss central questions regarding economic justice, racial justice, and strategic approaches to closing the wealth gap.
An Introduction To Social Justice Investing – Webinar. Tuesday, May 10, 1-2:30pm ET. This webinar will provide an introduction to social justice investing, explain how it’s different from mainstream ESG investing strategies, and provide some insight into how one group is implementing it on the ground.
Total Impact Summit 2022: Investing For New Economies – In-Person Conference by ImpactPHL with SOCAP. May 16-17 at Convene Center City in Philadelphia. This two-day summit is for individual and institutional investors, fund managers, and financial advisors to learn about local and global innovations, discover investable solutions, deploy capital, and generate social impact. Register here and use code SHUMAN to take $300 of the current price.
ICYMI
Regenerative Finance: A Path To Economic Justice, Initiative for Local Capital (April 20)
Denver’s Growth Leaves Grocers & Healthy Food Efforts In Its Wake, Fair Food Network (April 18)
The Racial Wealth Gap Begins With Our Tax Code, Shelterforce (March 8)
JOBS BOARD
Project Equity is hiring a Summer Intern: Employee Ownership Policy.
Mission Driven Finance is hiring a range of positions. See openings here.
Impact Finance Center is hiring a range of fellow positions. See openings here.
Sun Valley Institute For Resilience is hiring a part-time Due Diligence Contractor.
BECOME A MAIN STREET CHAMPION
Have you always wanted to start a local investment club? A website of local investment offerings in your community? A local investment study group? Whatever your interest or ambition, we invite you to “go public” to help others in your region find you, scheme with you, and start a local investment movement in your community. Our goal is to identify dozens, then hundreds, then thousands of Main Street Champions like you across America. We already have Main Street Champions across the U.S., from San Luis Obispo, CA to Providence, RI, and even Australia! Together, we can move our hard-earned savings from Wall Street back into our communities. Fill out the intake survey below to join this first cohort!
SOME OF The MSJ’s VINTAGE ISSUES
NH Senate considers strangling local investment in affordable housing
How San Franciscans secured $9.4 million in affordable housing 🌁
About The Main Street Journal
The Main Street Journal aims to catalyze the movement of $50 trillion from Wall Street to Main Street to facilitate economic development and economic justice. It’s sponsored by the National Coalition for Community Capital, with a grant from the Heron Foundation. We welcome feedback about everything, from our design to content. And we welcome suggestions of other groups to involve as partners, and other information to include. Please send ideas to Sophia Leswing at sophia@main-street-journal.com.
PARTNERS
We welcome any nonprofit or for-profit committed to local investment as a partner. If your organization is interested, please contact Sophia Leswing at sophia@main-street-journal.com.