New equity fund for South, West side business owners meant to build wealth for communities
PNC Foundation announced their commitment of $1.5 million to kickstart the Community Micro Equity Fund, which will be providing funding for business owners who haven’t been able to access traditional capital.
Four years ago when Tiffany Williams was starting her cafe and catering business Exquisite 501, she wasn’t able to access capital through a bank.
Williams instead went through an entrepreneur program at Sunshine Enterprises and received funding through Greenwood Archer Capital. And now she’s hoping a new Community Micro Equity Fund will provide her with money to expand her business even more.
“Our business has the opportunity to scale into larger venues where we are competing with some of the larger caterers across the city of Chicago,” Williams said. “But we need the people to be able to do the competing, we need more technical advances in our business and we need new vehicles to be able to do so.”
The Community Micro Equity Fund was launched Wednesday during a news conference at Sunshine Enterprises, which is next door to Williams’ business in Chicago’s Woodlawn neighborhood.
PNC Foundation, part of PNC Financial Services Group, provided $1.5 million in grant money, which will be administered by Sunshine Enterprises and Greenwood Archer Capital, previously known as the Chicago Neighborhood Initiatives Micro Finance Group.
Thurman Smith said the fund will complement the city’s existing Invest South/West initiative.
“This is how we drive sustainable wealth creation and equity in our city,” Smith said.
The fund will provide entrepreneurs, primarily on the city’s South and West sides, with up to $25,000 that won’t have to be paid back in the first two years. In the third year, business owners will start to pay off the principal amount, according to PNC Foundation. After the third year, the amount can be paid off completely or turned into a loan.
“Without access to all forms of capital, this path may not be realized for certain Black and other underserved entrepreneurs,” said Erica King, president of Greenwood Archer Capital. “We believe equity means continued steps toward equality by giving disadvantaged people different treatment to make opportunities the same as others.”
King said applications for the fund opened Wednesday, and that most applicants will be required to go through a 12-week program run by Sunshine Enterprises that will focus on providing business owners with information about marketing, bookkeeping, legal help and other topics related to running a business.
Mayor Lori Lightfoot on Wednesday called the fund a tool to disrupt the trends of social and economic inequities.
“We have to make sure that people in communities like this one have the opportunity not only to help themselves, but to help their families, help their employees and build up generational wealth that really is fundamentally lacking because of systemic racism and discrimination and a lack of investment,” Lightfoot said.
Williams opened her business in Woodlawn because it’s where she is from, and she wanted to create a shared kitchen space where chefs from the area can host pop-up events to test their recipes.
Javon Nicholas, owner of Egg Rolls Etc., attended Wednesday’s event and plans to apply for the funds to expand her business of frozen egg rolls that have non-traditional fillings like spicy jerk cabbage, collard greens or mild buffalo chicken.
In the past four years, she’s been able to sell some of her products at grocery stores, but she still hasn’t been able to access larger capital. If she gets money from the Community Micro Equity Fund, she said that will enable her to hire more employees and build up her inventory.
“There is no legacy for me as far as money,” Nicholas said. “I’ve used my savings, I’ve pitched and won grants, and then I’ve received small loans from banks and repaid them. And still, it appears to be a cap on what they allow.”
Elvia Malagón’s reporting on social justice and income inequality is made possible by a grant from The Chicago Community Trust.