ACE Accelerates Growth and Resiliency of Diverse Businesses with Wells Fargo Grant
Guest blog post written by Martina Edwards, Chief of Strategic Partnerships, Access to Capital for Entrepreneurs (ACE). ACE is a recipient of a Wells Fargo Diverse Community Capital Activator award.
The magnitude of this global pandemic’s impact on small business is extraordinary, posing an unparalleled economic danger to families and communities.
Unwavering commitment. Access to Capital for Entrepreneurs (ACE) has provided capital, coaching, and connections to underserved business owners and places overlooked by traditional financial institutions for two decades in the state of Georgia. With 43.1 percent of Georgia’s private workforce employed by its 1.1 million small businesses, if these businesses don’t receive a lifeline, some Georgians won’t have jobs to return to post-pandemic. As we face a barrage of compounding factors — COVID-19, social unrest, health uncertainty, systemic racism, wealth and economic disparities — there has been no time in our twenty-year history when our work has ever felt more important. Without question, wide-ranging supportive funding and being a Wells Fargo Diverse Community Capital Activator program awardee has helped propel our efforts to expand the reach of our diverse lending for entrepreneurs of color and supported sustainability for ACE through risk mitigants and peer engagement.
Impactful measures to capitalize small business. ACE has stepped forward to ensure small businesses have equitable resources to survive, recover, and thrive. Early COVID-19 impact assessment and swift action allowed us to stand in the gaps with emergency loans and sustaining measures such as deferments for clients in hard-hit sectors. After so many small businesses and sole proprietors were unable to receive funds through the first round of the Paycheck Protection Program (PPP), ACE made $4.5 million round two PPP loans to those underserved and overlooked. To date, ACE has closed 450 loans — nearly 400 percent more than the year prior, providing an additional $24.5 million to borrowers in need. In line with our ethos, more than 80 percent of these funds went to entrepreneurs of color and women. Capital coupled with debt relief and business advisory is inspiring Black owners like Amia Guild to find a path forward.
For Guild, perhaps worse than the initial shut down back in March, which forced her childcare service company Takes a Village Transportation to a halt, was realizing that months later most schools continue remote learning. With no other option than to pivot and her readiness to implement new technologies, Guild completed a diverse supplier certification and piloted a new app that will allow her to launch ride-share on-demand for children. With this, she became a preferred vendor with Atlanta Childcare Services and acquired a new contract, supporting essential workers. Those shifts plus bookkeeping resources, a business assessment, as well as a grant covering three months of loan payments from ACE, have stabilized her business and put it in driving gear again.
Relief, Recovery, and Reinvention. The ability to be nimble and think differently remains critical. A recent GetApp survey found that 92 percent of small businesses surveyed are changing their models to keep up with rapidly evolving conditions and customer needs. While many entrepreneurs have done an incredible job pivoting some Black, along with other diverse and low-income-owned, businesses remain particularly at risk due to industry, size, margins, and limited capital.
Mindful of this, ACE, in partnership with the Morehouse Innovation Entrepreneurship Center (MIEC) launched our first virtual Accelerated Growth Activator Program (AGAP) cohort focused on diverse businesses poised to scale. Anticipating business continuity support would be needed to navigate extraordinary times, 11 eager Black and Latinx main street businesses like Breadworks International, Inc. made the six-month commitment.
Pre-COVID, this woman-owned business generated revenue over $1 million with 20 staff and large order contracts, including a global airline. Unfortunately, the pandemic led to significant layoffs and reduced hours. Despite an unexpected full business site relocation, she rebounded by leveraging learnings and pivoting strategies gained from biweekly AGAP sessions. Recently, she won a $1.5 million contract and a new partnership with a local grocery store chain supporting six locations, enabling her to return 12 loyal employees back to full time status.
DCC Activator Award. In January 2020, the Wells Fargo Foundation announced that ACE was a recipient of a $2.8 million grant to spark small business growth and job creation as a part of its Diverse Community Capital Program.
Funding was provided to enable ACE to leverage its enterprise-wide core capabilities to provide nearly $30 million in loans to at least 250 diverse small business owners over a three-year period, enabling 500 local jobs. The funding originally supported a loan guarantee program to provide high-risk business owners with greater access to capital and technical assistance. In addition, the grant was to support the expansion of an existing in-house development program for women entrepreneurs and partnership with Morehouse College, the nation’s only historically black college for men, to expand an entrepreneurship training program focused on activating growth and building business acumen for existing small businesses poised to scale. Considering the global pandemic and challenges of COVID-19 to CDFIs like ACE and the diverse small businesses we serve, Wells Fargo has been intentional and mindful, allowing for flexibility in repurposing the grant to support and meet immediate relief and recovery needs.
Continued Support. We appreciate the deep commitment and sustaining philanthropic support that the DCC Activator grant provides to buoy a weakened small business sector, especially for historically marginalized people and places. ACE is committed to our mission and vision of equitable access to affordable capital to accelerate growth and resiliency of diverse small businesses.