The bank’s Open for Business Fund grant to LISC LA will offer mix of loans and grants to spark long-term growth
LOS ANGELES –News Direct– Wells Fargo
Husband and wife business owners sit at a table in their vegan cafe in Los Angeles.
LOS ANGELES, February 15, 2022 /3BL Media/ – Wells Fargo today announced a $20 million donation to help Los Angeles small business owners own more of their businesses’ assets, including property and equipment. LISC LA (Local Initiatives Support Corporation, Los Angeles) will distribute the funding as a mix of grants and loans in Los Angeles County, with a focus on diverse-led small businesses that have historically been underfunded.
The donation comes from Wells Fargo’s Open for Business Fund, a roughly $420 million fund that the company created in July 2020 to help small businesses stay open during the COVID-19 pandemic. The fund has focused on racially and ethnically diverse small businesses across the US, which have been disproportionately impacted by the pandemic. The fund was created from the gross processing fees that Wells Fargo made from administering Paycheck Protection Program loans in 2020. Wells Fargo has worked with Community Development Financial Institutions (CDFIs) and local nonprofits across the nation to distribute funding.
“Fostering an inclusive economic recovery and helping small businesses persevere in the wake of COVID-19 is a priority for us,” said Charlie Scharf, Wells Fargo’s CEO. “As a company, we have a commitment to make the communities where we operate stronger, and to do it at a very local level. Today’s donation is one of the largest we’ve made from the Open for Business Fund, and we know it will make a difference for small business owners here in Los Angeles.”
“Small businesses are the beating heart of our economy, which is why we’re committed to supporting them in recovering and building back stronger from the pandemic,” said Mayor Eric Garcetti. “Community partners like Wells Fargo are essential to this work and I look forward to seeing the difference this program will make for small businesses throughout our city.”
“When the pandemic hit two years ago, our small businesses were some of the first to take a hit. Some of our most beloved stores and restaurants were forced to adapt to our new reality of distanced shopping and outdoor dining. Some were forced to close their doors for good. This commitment to help support local and small businesses throughout Los Angeles will deliver critical assistance to businesses in need,” said Congresswoman Karen Bass. “Program funds will help existing small businesses acquire assets such as property, equipment, or technology, which will promote greater financial independence, and help mitigate the effects of future economic shocks, which is especially important as we recover from this pandemic. I will always stand with the small businesses of this city. They are absolutely critical to our city’s success and I will always do whatever I can to ensure they flourish. COVID-19 continues to create major challenges and this investment couldn’t be coming at a better time.”
LISC LA, in collaboration with Inclusive Action for the City (IAC), will administer the $20 million grant in four ways:
Acquisition Assistance: 0% interest, forgivable amount up to $500,000 per small business owner to help purchase property in business districts.
Growth capital: Growth capital of up to $250,000 with longer than usual repayment terms, to help small businesses fill the ‘friends and family’ financing gap and acquire key assets such as equipment and technology.
Microloans: Low-cost, micro-loans up to $30,000 with interest rates capped at 3% to purchase assets.
Grants: Cash grants of up to $5,000 for approximately 150 small businesses making $300,000 or less in annual revenue, to help smaller businesses return to thriving.
“The Open for Business Fund program helped us feel hopeful about the future,” said Tony Jolly, co-owner with Tina Amin of the Hot & Cool Café in Leimert Park, who worked with LISC LA as part of a previous Open for Business Fund grant. “We have a promising business we can move forward and new ideas to strengthen the community. Within spaces like ours, connections lead to community action.”
Jolly and Amin aim to grow their business and add jobs to the community by starting a mobile coffee cart program for formerly incarcerated individuals to learn entrepreneur skills.
“Despite diverse small businesses being the cornerstone of Los Angeles’ economy, many remain undercapitalized and lack the support network for business growth,” said Tunua Thrash-Ntuk, Executive Director of LISC LA. “This incredibly generous gift from Wells Fargo will help LISC LA continue our efforts to close the racial wealth and opportunity gaps in our community and expand on our work to invest directly in diverse entrepreneurs and provide them with the necessary support they so often do not receive .”
Actor Anthony Anderson was on hand for the announcement and spoke to the local impact: “As someone whose father owned small businesses in Compton, I know first-hand how hard it is to run a small business. The Open for Business Fund will help these businesses tremendously and help more dollars stay in our communities.”
Los Angeles small business owners interested in learning more about the program can find information www.lisc.org/los-angeles/abc-fund/
Today’s Open for Business Fund grant builds on the bank’s ongoing support of advancing economic opportunity for small businesses in Los Angeles, including recent collaborations with organizations such as Genesis LA, Vermont Slauson Economic Development Corporation, and Los Angeles Economic Development Corporation among others. Donations to these entities support programs that inspire and sustain future entrepreneurs.
On a national basis, Open for Business Fund grantees are estimated to reach more than 152,000 small business owners, helping to maintain over 255,000 jobs. Roughly 85% of small businesses served by grantees are projected to be Black, African American, Hispanic, Asian American, and Native American small business owners. Wells Fargo also offers a Small Business Resource Center where entrepreneurs can explore business planning, financing considerations, and practical advice.
About Wells FargoWells Fargo & Company (NYSE: WFC) is a leading financial services company that has approximately $1.9 trillion in assets, proudly serves one in three US households and more than 10% of small businesses in the US, and is the leading middle market banking provider in the US We provide a diversified set of banking, investment and mortgage products and services, as well as consumer and commercial finance, through our four reportable operating segments: Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth & Investment Management. Wells Fargo ranked No. 37 on Fortune’s 2021 rankings of America’s largest corporations. In the communities we serve, the company focuses on its social impact on building a sustainable, inclusive future for all by supporting housing affordability, small business growth, financial health, and a low-carbon economy. News, insights, and perspectives from Wells Fargo are also available at Wells Fargo Stories.
Additional information may be found at www.wellsfargo.com | Twitter: @WellsFargo.
View additional multimedia and more ESG storytelling from Wells Fargo on 3blmedia.com
View source version on newsdirect.com: https://newsdirect.com/news/wells-fargo-donates-20-million-to-strengthen-small-businesses-in-los-angeles-389681794