One Year Later, Detroit’s Entrepreneurs of Color Fund Provides $2.75 Million to Nearly 30 Minority-Owned Small Businesses
Detroit Development Fund, JPMorgan Chase & Co. and the W.K. Kellogg Foundation established loan program delivers critical capital to small businesses that support the city's comeback
December 14, 2016 (Detroit) – Detroit’s Entrepreneurs of Color Fund (EOC) today announced that it has awarded nearly 30 minority-owned small businesses with $2.75 million in critical capital since it began making loans one year ago. Created by the Detroit Development Fund (DDF), JPMorgan Chase & Co. and the W.K. Kellogg Foundation (WKKF), this $7 million program is supporting Detroit-based neighborhood businesses owned by entrepreneurs of color and businesses that primarily hire people of color.
“One of the most important things we can do to keep Detroit’s recovery headed in the right direction is come together to support the work being done by our minority, small business owners,” said Mayor Mike Duggan. “With the support of DDF, JPMorgan Chase and WKKF, our entrepreneurs have much greater access to the resources and tools they need to succeed and grow in neighborhoods across our city."
The EOC Fund, which is facilitated by DDF, a Michigan 501(c)3 Community Development Financial Institution (CDFI), provides financing to Detroit small businesses that lack access to traditional forms of credit and capital. Funding for the EOC Fund is provided by a $3.5 million grant from JPMorgan Chase, as part of their $100 million commitment to Detroit’s economic recovery, and a $3.5 million investment from the Kellogg Foundation as part of its larger roughly $25 million annual investment in the city and commitment to promoting equity.
“With help from JPMorgan Chase and the W.K. Kellogg Foundation, we are providing minority small business owners with the capital they need to thrive,” said Ray Waters, President, DDF. “We are proud to work with entrepreneurs from downtown to our residential neighborhoods that need assistance in order to grow their companies and are pleased to now offer these services to Detroit residents."
“Small business owners like the ones benefiting from the Entrepreneurs of Color Fund are critical to Detroit’s comeback and supporting them is one of the most important things we can do,” said Jamie Dimon, Chairman and CEO, JPMorgan Chase. “The lessons learned from this fund are not only paying off in Detroit but have allowed us to develop similar programs for minority-owned, small businesses in Los Angeles, Chicago, and New York City.”
More than two-thirds of the loans are supporting neighborhood businesses, creating approximately 79 jobs. Forty-five percent of the loans are supporting minority women-owned businesses.
“Seeing capital flowing to so many small businesses owned by people of color and the communities they serve in Detroit is a key leverage point for equitable, local, economic development,” said La June Montgomery Tabron, WKKF’s president and CEO. “That’s why we developed and initiated this fund, in order to change the wealth trajectory of these communities now and for generations to come.”
Three examples of loan recipients include Benkari Mechanical, Rowe Trucking and Detroit Vegan Soul.
“As a female, minority, small business owner, accessing capital can be challenging,” said Adrienne Bennett, Owner of Benkari Mechanical, LLC. "Because of this program, the Detroit Development Fund, JPMorgan Chase, and WKKF we were able to secure our largest contract to date, the domestic plumbing systems for Building C on the Little Caesars Arena, which demonstrated our ability to successfully compete with larger contractors.”
"As a small business owner, this money made it possible for me to keep running my business because sometimes it takes 30 to 60 days to get paid from some of the contractors that we work for,” said Rhonda Rowe, Owner of Rowe Trucking. “I am grateful to the whole team at the Detroit Development Fund for working with me to keep my business running."
“This loan has helped us expand to a second location to better serve our customers,” said Kirsten Ussery, Owner of Detroit Vegan Soul. “We're grateful to the Detroit Development Fund for helping us to grow our business.”
There are 50,000 minority-owned small businesses in Detroit, making it the fourth largest city for minority entrepreneurship. The EOC Fund is designed to increase economic opportunity by providing these businesses with greater access to capital and business assistance, allowing them to grow, hire locally and further contribute to the city’s economic recovery. According to the JPMorgan Chase Institute, spending at Detroit small businesses has grown significantly – from down over 4 percent in early 2014 to up 4 percent in mid-2016.
About the Detroit Development Fund
DDF was established in 1996 with a mission to “improve the quality of life for residents in underserved Detroit neighborhoods.” A 501(c)(3) and certified as a CDFI, DDF provides term loans and lines of credit to small businesses, small contractors, and for-profit and nonprofit affordable housing developers. DDF currently manages $23 million in loan capital. Since lending activities began in 2002, DDF has closed over $36 million in loans to businesses in Detroit, which helped to retain approximately 1,200 jobs and created approximately 1,800 new jobs. Approximately 72 percent of DDF’s small business loans have been made to minority-owned companies, and over 1,400 housing units were rehabbed as a result of DDF’s loans. DDF lending activities have leveraged over $200 million in public/private investments with more than $7 million in projects under management.
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 consumers 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. The firm uses its global resources, expertise, insights and scale to address some of the most urgent challenges facing communities around the world including the need for increased economic opportunity. Information about JPMorgan Chase & Co. is available at www.jpmorganchase.com.
About the W.K. Kellogg Foundation
The W.K. Kellogg Foundation (WKKF), founded in 1930 as an independent, private foundation by breakfast cereal pioneer Will Keith Kellogg, is among the largest philanthropic foundations in the United States. Guided by the belief that all children should have an equal opportunity to thrive, WKKF works with communities to create conditions for vulnerable children so they can realize their full potential in school, work and life. The Kellogg Foundation is based in Battle Creek, Michigan, and works throughout the United States and internationally, as well as with sovereign tribes. Special emphasis is paid to priority places where there are high concentrations of poverty and where children face significant barriers to success. WKKF priority places in the U.S. are in Michigan, Mississippi, New Mexico and New Orleans; and internationally, are in Mexico and Haiti. To learn more, visit www.wkkf.org or follow WKKF on Twitter at @wk_kellogg_fdn.