A new multi-million dollar initiative will give financial boosts to diverse entrepreneurs
Vice President Kamala Harris announced that the fund will go towards diverse entrepreneurs from underserved communities.
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A new financial boost of up to $100 million will be given to up and coming entrepreneurs from diverse backgrounds.
Last week, the Biden Administration announced a new slate of actions that will be in effect for Black and Brown small business owners. The new initiative will deliver a mix of private and federal funding for start up businesses.
“Small businesses are the engines of our economy and the path to economic prosperity for countless Americans in underserved communities,” the White House said in a statement.
The non profit, Hyphen, will distribute grants along with J.P. Morgan Chase and the W.K. Kellogg Foundation. Funding will also be given with money from the federal resource, the American Rescue Plan, an initiative originally developed during the COVID-19 pandemic.
According to the White House website, The American Rescue Plan will provide emergency grants, lending, and investment to hard-hit small businesses so they can rehire and train workers and purchase health sanitation supplies.
The importance of the funding is to allow struggling small businesses the opportunity to strive for the best to create a growing business venture.
A research study conducted by Forbes, states that Latinos are the fastest- growing small business owners in the country. However, the numbers for obtaining grants and loans do not match that.
According to Stanford Business, research found that 20% of small businesses owned by Latinos who applied for bank loans over $100,000 obtained funding, compared to 50% of White-owned businesses.
The same study provided by Forbes also found that average annual revenue for Latino-owned businesses was $45,435 greater than for non-Latino-owned companies ($212,816).
While Black and Latino businesses are equally likely to apply for funding, they are less likely to experience positive outcomes than White businesses.
Around 80% of businesses owned by White business owners received a large portion of what they requested by their bank, only 59% of Black business owners and 66% of Latinos received some of what they requested.
There is no surprise that Latino and Black business owners have struggled to receive a financial boost from banks; however, there is hope that the initiative provided by the Biden Administration will give more assistance to diverse business owners.