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Local Initiatives Support Corporation Los Angeles (LISC LA) announced it has received a $20 million donation from Wells Fargo to help diverse small business owners in Los Angeles unlock their potential to grow, scale, create jobs, and fuel wealth creation through acquiring assets like property and equipment.
Los Angeles is home to 1.3 million small businesses, close to 60% of which are diverse-owned. Research shows that non-white entrepreneurs face barriers to accessing the same startup capital, professional networks, and technical assistance as their white counterparts.
“Despite diverse small businesses being the cornerstone of Los Angeles’ economy, many remain undercapitalized and lack the support network for business growth,” said Tunua Thrash-Ntuk, executive director of LISC LA. “This incredibly generous gift from Wells Fargo will help LISC LA continue our efforts to close the racial wealth and opportunity gaps in our community and expand on our work to invest directly in diverse entrepreneurs and provide them with the necessary support they so often do not receive.”
LISC LA said it will use the investment to launch the Asset Building for Communities of Color (ABC) Program, to deploy capital toward growth strategies, like owning more of their business, for diverse entrepreneurs across Los Angeles County. Products under the program will launch in the summer of 2022.
By working with local business development organizations to provide relevant and tailored technical assistance and one-on-one advising, LISC LA will ensure that diverse small businesses have the necessary tools to succeed at every stage of business growth.
LISC LA will also partner with non-profit Inclusive Action for the City (IAC) to amplify and diversify its deployment strategy and products.
“Small businesses are the foundation of our local economy and we are excited to prioritize their voices and needs through this initiative with LISC LA and Wells Fargo,” said Rudy Espinoza, executive director of Inclusive Action for the City. “Our community entrepreneurs need a variety of tools to rebuild after the pandemic, and this investment gives us a unique opportunity to help small businesses grow and build wealth for their neighborhoods. This is a transformative moment to build an equitable system that prioritizes Black and brown entrepreneurs, and Inclusive Action is ready to work to further this long-overdue priority.”
The $20 million donation comes via Wells Fargo’s Open for Business Fund, a roughly $420 million national small business recovery effort with a focus on racially and ethnically diverse small business owners who have been disproportionately affected by the pandemic.
Wells Fargo created the Open for Business Fund in July 2020 from the gross processing fees it received from Paycheck Protection Program loans made in 2020.
Wells Fargo donated funds to Community Development Financial Institutions (CDFIs) and local non-profits, like LISC LA, to distribute funding across the nation.
“Wells Fargo has been working with LISC LA for years to support communities throughout the county that have been underserved for far too long, ensuring these communities get access to the critical support and resources needed to grow and thrive,” said Gregg Sherkin, Southern California Social Impact and Sustainability leader at Wells Fargo. “We are thrilled to be working again with LISC LA on our Open for Business Fund because they understand the needs of diverse small business owners and will provide them with critical tools and assistance to grow their businesses long-term. In doing so, the communities that they serve benefit as well.”
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