Wednesday, June 19, 2019

Elizabeth Warren proposes $7 billion in grants for minority businesses - Vox.com

Elizabeth Warren proposes $7 billion in grants for minority businesses - Vox.com


Elizabeth Warren proposes $7 billion in grants for minority businesses - Vox.com

Posted: 15 Jun 2019 02:41 PM PDT

Democratic presidential candidate Sen. Elizabeth Warren released a new plan on Friday to "level the playing field for entrepreneurs of color" by providing business grants to minorities in order to close the startup capital gap — the difference in capital available to white entrepreneurs versus entrepreneurs of color.

Warren argues that "every American should have a fair shot at starting a small business" but says the playing field is currently drastically uneven, with entrepreneurs of color starting businesses with far less money than their white counterparts. She writes that disparity severely affects minority-owned businesses' ability to attract investors and apply for credit, as well as their bottom lines.

"Disparity in startup capital is the single biggest reason that promising Black-owned businesses on average are less profitable and bring on fewer employees than white-owned businesses," she said.

In order to level the playing field for entrepreneurs, Warren has a plan to distribute $7 billion to minority businesspeople.

How the plan will work

Warren proposes distributing $7 billion in grants through a new "Small Business Equity Fund." She stresses that the money will be in the form of grants, "not loans or loan guarantees," in order to ensure entrepreneurs can focus on growing their businesses rather than on repaying debt.

The fund would be managed by Warren's comprehensive new Department of Economic Development, which Vox's Matthew Yglesias explained in a piece on Warren's "economic patriotism":

One specific bullet point on Warren's policy agenda is to create a unified Department of Economic Development that would combine the functions of the Commerce Department with the Small Business Administration, the Patent and Trademark Office, various job training and R&D programs scattered around the bureaucracy, and the export and trade agencies including the Office of the US Trade Representative.

The bureaucratic reorganization, however, is basically just to set the stage for a mission statement: "the new Department will have a single goal: creating and defending good American jobs."

Although the Small Business Equity Fund would be overseen at the federal level, Warren sees state and local stakeholders as being key to distributing funds; she says her program will be modeled on the State Small Business Credit Initiative, a federal program that gave states a great degree of say in how they chose to distribute $1.5 billion. This freedom was given as officials felt local leaders have a better grasp of the needs of entrepreneurs in their states than federal officials would. Under Warren's plan, local governments would be required to work with minority investment managers to decide how the funds would be spent.

The federal government would also create guidelines for who would be eligible for the grants: They would be limited to entrepreneurs who are eligible for the Small Business Administration's existing 8(a) program. To be eligible for that program, a business must be at least 51 percent owned and controlled by a socially and economically disadvantaged individual who has less than $100,000 in household wealth. This figure encompasses a large percentage of minority families; according to the Federal Reserve, the median net worth of a black family is $17,600, while the median net worth of a Latinx family is $20,700.

Warren would also work at the federal level to increase the Minority Business Development Agency's budget — she pledges to triple its funding in her presidential budget.

As with many of Warren's other plans, the cost of this proposal would be entirely covered by her proposed wealth tax, a 2 percent tax on every dollar of wealth an American owns above $50 million, and a 3 percent tax on every dollar of wealth above $1 billion. According to the candidate, the $7 billion investment would help create 100,000 new minority-owned businesses and as a result provide 1.1 million jobs.

The startup capital gap, and why it matters

Warren's proposal states that the startup capital gap is the single biggest reason minority-owned businesses are less profitable on average than white-owned businesses. And that capital gap is vast.

The typical black entrepreneur, the candidate notes, starts a business with one-third the startup capital of the typical white entrepreneur. Part of this is due to difficulties receiving loans; another part of it is that minority families often have less wealth to invest in a family member's startup than white families do. As a Stanford Business School report found, "Latino business owners tend to depend on personal savings and seed funding from friends and family to start their businesses," and are "much more likely [than white entrepreneurs] to use personal guarantees than business assets to secure financing."

Having less money at the beginning of a business makes it more difficult to attract money later on, as it limits the amount an entrepreneur can invest in things like prototyping, real estate, inventory, and marketing, all things that, when done successfully, attract new investors and credit.

While the wealth threshold to quality for Warren's program may seem relatively low, $100,000 is far more than most minority families have on hand, according to the senator, who cites research that found $100,000 is roughly five times the median net worth of Latinx and black families and more than 10 times the median net worth of Native American families.

Warren's plan invokes the language of reparations, something she has vocally endorsed on the campaign trail, particularly when it suggests that the government has an obligation to address the racial wealth gap "because the government helped create that wealth gap with decades of sanctioned discrimination." It is important to note, however, that this policy is for all minorities rather than just for black Americans.

How Warren's plan compares to other candidates' plans

Warren released her plan ahead of the Black Economic Alliance's presidential forum in South Carolina, which she will be attending alongside a number of other Democratic presidential candidates, including Cory Booker, Beto O'Rourke, and Pete Buttigieg.

O'Rourke released his own small business plan on Saturday, focusing on women, communities of color, and small businesses more generally. His plan hopes to create 200,000 new small businesses to Warren's 100,000, and pledges a $10 billion small business credit initiative for "economically distressed areas" to Warren's $7 billion Small Business Equity Fund. Notably, O'Rourke's plan doesn't give funding directly to small-business owners in the form of grants. Instead, it funds a range of programs designed to increase loan accessibility and reduce discrimination. Like Warren, he has pledged to triple investment in the Minority Business Development Agency in order to provide resources and mentorship to minority small business owners.

Booker is attending several South Carolina events around this weekend's forum, and is expected to use his stops to discuss the racial wealth gap and growing small businesses owned by African Americans, although he has not released a specific policy proposal.

Others Democrats have proposed more small-business-friendly policies. Both O'Rourke and Tulsi Gabbard have suggested cutting or offering deductions on small business taxes, but proposals such as these fail to account for the wealth gap that prevents entrepreneurs of color from opening a business in the first place.

This plan fits in well with Warren's myriad other plans

Warren has the most plans of any 2020 candidate, but almost all of her plans have the same overarching purpose: erasing the wealth gap. Her overall platform is focused on what she calls "economic patriotism," and this new plan fits right into that larger vision.

As Vox's Ezra Klein explained:

Warren's tagline is "I have a plan for that." And on one level, it's true: She has a lot of plans. But a clearer way of understanding her pitch is she's got one plan that she applies over and over again.

As Warren sees it, there's been a massive hoarding of wealth — and thus of power and opportunity — in this country. She wants to tax the wealth and redistribute both the money and the opportunity. She wants to break up concentrations of economic power by putting workers on corporate boards and unleashing antitrust regulators on Amazon and Facebook and ending Washington's revolving door. These are different policies, yes, but they all say the same thing: The wealthy have too much money and power, and Warren wants to change that.

Her newest proposal is grounded in these same themes: It disparages an "uneven playing field," and she argues that it will "move us closer to an America where everyone has a fair shot to succeed."

Economic issues remain a top concern for Democratic voters, and by adding her entrepreneurial investment plan to her portfolio of "economic patriotism" initiatives, Warren continues to suggest that addressing that concern is one of her top priorities.

Nav Opens Small Business Grant to Help Owners Overcome Business Challenges - PRNewswire

Posted: 23 May 2019 12:00 AM PDT

SALT LAKE CITY, May 23, 2019 /PRNewswire/ -- Today, Nav, a free site and app for small business owners to get matched to financing options and access their business credit scores, opened another round of the company's Small Business Grant, awarding $10,000 to a U.S. small business owner who needs capital to grow their business.

"As a small business owner for the past 20 years, I know firsthand that the biggest pain point for business owners is accessing financing to help grow their business," shared Levi King, Nav CEO and Co-Founder. "Through Nav's Small Business Grant, our team has seen how life-changing an influx of capital can be for a small business. We're excited to continue offering this Grant and look forward to seeing everyone's application."

Since launching the Grant in early 2018, Nav has awarded nearly $50,000 to businesses across the country, including the most recent winner Running Dogs Brewery, an Oregon-based Brewery run by husband and wife, Jaron and Maggie Clayton.

In addition to the $10,000 grand prize, Nav also selects a runner-up and second runner-up, awarding $2,000 and $1,000 in prize money, respectively.

The Nav Small Business Grant Contest is open to U.S.-based small businesses that have fewer than 99 employees and have been operating for six months or more. To enter, participants must:

  • Sign up for a free Nav account
  • Share on their company's Facebook or Instagram account about a challenge they are experiencing and how the Grant will be used to overcome that hurdle, tagging Nav (@navsmb)
  • Provide direct links to the aforementioned social media posts

Business owners can learn more about Nav's Small Business Grant and view full contest rules at Nav.com/business-grant-contest.

While it is not required, participants are highly encouraged to learn about past winners - Private Detox of Utah, CJ's Bait and Tackle and Founding Foods - and consider using video to capture their business and bring personality to their application.

The next contest is open from May 23 to Aug. 15, 2019, and the winners will be announced in September 2019.

About Nav
More than 500,000 small business owners use Nav to get more funding, lower their costs and save time so they can create the business of their dreams. It gives free access to business credit scores, cash-flow analysis, and tools to help build business credit. Nav's online marketplace offers more than 110 financing products, including loans and credit cards, and uses a lender-neutral algorithm to help business owners find the best financing options for their needs before they apply. The company has offices in Silicon Valley and Salt Lake City. For more information visit: nav.com.

CONTACT:
Amanda Triest
Nav PR Manager
atriest@nav.com
801-890-5024

SOURCE Nav

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http://www.nav.com

Small Business Grant Program Launched in Town of Union - wnbf.com

Posted: 03 Jun 2019 12:00 AM PDT

The town of Union is making available money to boost established and start-up businesses.

Those interested in applying for the new grant program should advise the town by July 1.

Town economic development director Joseph Moody said the initiative is designed to encourage expansion and retention of for-profit businesses with five or fewer employees.

Moody said up to $10,000 in money may be available per grant. Several grants may be awarded.

Businesses throughout the town of Union, including those in the villages of Endicott and Johnson City, may apply for the competitive grant program.

The town of Union Local Development Corporation board of directors will review grant applications. The board is scheduled to announce the grant awards in September.

Business operators can obtain more information at the town of Union economic development department website.

Contact WNBF News reporter Bob Joseph: bob@wnbf.com

For breaking news and updates on developing stories, follow @BinghamtonNow on Twitter.

E-commerce business gets grant funds - Coalfield.com

Posted: 19 Jun 2019 08:00 AM PDT

Connecting companies to their audiences with social media, engaging content and other digital outlets is how Blake Salyer, of Norton, describes the new direction of Winze Co. LLC.

An e-commerce brand start-up, Winze now offers both creative services and fulfillment solutions for its client base.

Salyer's business was recently approved for a $10,000 seed capital matching grant from the Virginia Coalfield Economic Development Authority.

"Assisting small businesses in their initial start-up is the intent of the VCEDA Seed Capital Matching Grant fund," said VCEDA Executive Director/General Counsel Jonathan Belcher. "Winze proposes to assist other businesses in their media needs which in turn can further assist other businesses in realizing their own growth potential."

Salyer worked with Tim Blankenbecler, of the Small Business Development Center at Mountain Empire Community College, in the development of his business plan and application to VCEDA.

Winze Co. opened in February in the business incubator space in Norton. The company offers a wide range of services including branding, content creation, social media management, marketing, consulting and merchandise management.

Prior to opening Winze, Salyer, a Norton area native, operated an Apple repair and support business. He lived in Johnson City, Tenn., for two years after college and did some freelance work there before deciding to return to Norton to open Winze Co.

"I am excited to have this opportunity," Salyer said. "I look at this as an opportunity to bring meaningful work to the region and I hope in the process to create jobs and to hold on to young talent in the region."

When starting a business, Salyer noted, some of the biggest challenges include having the needed equipment and operating capital. The seed capital grant, he said, has helped him to meet those challenges.

The application projects two full-time jobs and one part-time job will be created within the first four years.

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