Southfield (CW50) – When urban development is progressing through a city, putting a focus on a city’s small businesses is of great importance. But how do these small businesses receive funding when they are turned away by banks?
The Detroit Development Fund was created to provide growth capital to small businesses in Detroit that aren’t able to get financing through banks. The importance of helping these small businesses is that they bring jobs into the community and help stabilize growth inside Detroit’s neighborhoods.READ MORE: Volvo Adds 195,000 Vehicles To Recall For Dangerous Air Bags
Ray Waters, President of Detroit Development Fund, joins Jackie Paige on Community Connect to discuss how his organization uses its funds to help small business that can’t receive funding through bank loans, as well as assist these businesses through services such as consulting, marketing, and capital-raising.
Waters talks about how it’s not that banks don’t want to help these small businesses, it’s that the regulations the banks have to follow don’t allow them to assist these businesses, either through low credit scores or not enough collateral. There are banks which support Detroit Development Fund, which allows them to in-turn assist the small businesses that the banks cannot. This funding can help small businesses grow their capital, collateral, and credit scores to one day receive traditional bank loans.
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Four years ago, Detroit Development Fund created the Entrepreneurs of Color Fund, which addresses a key barrier to racial equity in the city by providing capital to minority-owned small businesses. Through partnerships with The Kresge Foundation, JPMorgan Chase, The Kellogg Foundation, and others, Entrepreneurs of Color Fund has been able to provide over $11 million to a number of Detroit’s 50,000 minority-owned businesses.
70% of the companies that received funding are within Detroit’s neighborhoods outside of downtown. Waters described the importance of where the funding goes as it pertains to different areas of Detroit.
“We love downtown and midtown, but if we can start growing these little businesses in these neighborhoods that need to be stabilized, that’s going to be a big plus as we go through urban development.”
Learn more at DetroitDevelopmentFund.comMORE NEWS: City Of Hamtramck Passes Out Free Water Filters To Residents Following Discovery Of Lead In Drinking Water
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