The Community Foundation of Greater Birmingham has awarded $1,155,000 in grants to six Community Development Finance Institutions (CDFIs) and other community-based lenders in the region. These grants are intended to increase the lenders ability to offer more patient, flexible capital that is targeted to the needs of small business owners, with a particular focus on Black-owned businesses. In addition, they will provide resources for in-depth technical assistance and support.
CDFIs have worked to meet the needs of underserved borrowers for decades. We believe that these grants will play an important role in building out Greater Birmingham’s entrepreneurial ecosystem. The grants were awarded to the following organizations:
- Sabre Finance, $260,000 to leverage pool of SBA loan funds and Technical Assistance funds and to seed an angel investment fund to support small, underserved businesses. (contact: Ray Morris)
- Bronze Valley Foundation, $260,000 for equity investments in tech enabled firms with diverse founders. (contact Neil Wright)
- Alabama Small Business Development Initiative (nonprofit arm of Black Business Resource Center), $260,000 to establish a revolving loan fund with lower interest rates and extended repayment terms. (contact Bob Dickerson)
- TruFund Financial Services, $155,000 for a loan loss reserve as they expandtheir lending and array of technical assistance programs to underserved businesses in the region. (contact Kim Evans)
- Hispanic Interest Coalition of Alabama, $110,000 to build on their successful Camino Loan Fund, making more funds and broader support available to disadvantaged business owners, particularly members of the Latinx and immigrant communities. (contact Carlos Aleman)
- Urban Impact, $110,000 allow Urban Impact to offer multiple, flexible options to meet the needs of the unique mix of main street, neighborhood-based and legacy businesses they serve on the road to becoming a CDFI. (contact Ivan Holloway)
Background: These grants were made possible by the Catalyst Funds, a pool of funds at the Community Foundation that have supported transformational projects in the region like Birmingham On-Demand microtransit, Birmingham Lights, regional cooperation and Innovate Birmingham. In 2018 the Foundation launched the Catalyst Fellowship. This program paired eight dynamic young Birmingham leaders with Catalyst fund donors to engage the next generation in the power of transformational philanthropy. The Catalyst Fellows worked with Rockefeller Philanthropy Advisors to identify and develop a new investment opportunity for the fund. This led to the creation of the Small Business Impact Grant to support underserved businesses in the region.
After an extensive process of research, consultation and community input, a review committee comprised of local financial experts and Community Foundation staff developed a Request for Proposal. The RFP invited applicants to think outside the box and consider what needs businesses were bringing to them. The were asked where there were gaps in the marketplace that this grant could help fill and specifically, how they could ensure their offerings would reach disadvantaged business enterprises, particularly those that were Black-owned.
The committee reviewed the proposals from applicants and in August recommended grants totaling $1,155,000 to the six organizations. All of the organizations selected presented innovative ideas that in combination set the scene for entrepreneurs of varying sizes and with differing needs to have access to both the funds and technical assistance resources they need to build or grow thriving businesses, particularly those who due to systemic inequities have historically not had as much access to business capital.
The Foundation believes that with this infusion of resources and support to Black business owners and other underserved businesses, entrepreneurs in our region will be better positioned to grow and flourish.