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Janel Knight Trulear
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(617) 875-6581

Small business group on challenges and solutions to enhance capital availability for entrepreneurs

Statement from Small Business for America’s Future Council member Conchie Fernández, founder of CF Creative on MBDA’s forum on capital access and solutions 

Washington D.C., June 16, 2023 – It was great to attend the first annual Diverse Business Forum on Capital Formation hosted by the  Minority Business Development Agency (MBDA). The event provided an important opportunity to explore challenges and possible solutions across the private and public sectors to enhance capital availability for minority-owned businesses.

As a small business owner, I find the current state of capital access daunting, and I’m not alone. In a new Reimagine Main Street survey of more than 1,000 diverse entrepreneurs, 1 in 3 small business owners including 58% of Black entrepreneurs and nearly 40% of Latino and Asian American and Pacific Islander entrepreneurs, worry they can’t handle an unexpected $5,000 expense. 

This is not an idle worry. Securing a traditional business loan poses a formidable challenge. Bootstrapping is often not an option so businesses resort to tapping into personal funds, courting investors, or contemplating company equity sell-offs. It is an uncertain journey to secure funding for a small business, with minimal control or predictability. 

The challenge is even bigger for small, minority-owned businesses. Despite their significant economic contributions, a mere 20% of Latino-owned businesses that applied for national bank loans got funding. Furthermore, Black entrepreneurs are three times as likely as their white counterparts to identify inadequate capital access as a profitability dampener.

Turning this situation around will require fostering robust collaborations among organizations that educate and support small businesses. We also need innovations that streamline lending processes and create products that serve the unique financial needs of entrepreneurs of color. Encouragingly, the Reimagine Main Street survey data illuminates potential pathways forward. For instance, 58% of respondents said they are willing to share digital access to their financial data when applying for loans. This willingness to share data holds promise to unlock innovations in underwriting, speed of decision-making, and the development of customized and accessible financing options. 

Donald R. Cravins Jr., Under Secretary of Commerce for Minority Business Development, should be commended for his leadership in hosting this event and highlighting the crucial issue of capital accessibility. His initiative sets an example that representatives in Washington should emulate, fostering an environment that meets the needs of entrepreneurs of color, promotes success, and lays a foundation for a future where businesses thrive in equity and prosperity.

To request an interview with Small Business for America’s Future Council member Conchie Fernández, founder of CF Creative contact Janel Knight Trulear at 617-875-6581 or janel@emccommunications.com. 

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About Small Business for America’s Future
Small Business for America’s Future is a national coalition of small business owners and leaders working to provide small businesses a voice at every level of government. We’re committed to ensuring policymakers prioritize the nation’s 30 million small businesses to create an economy that works for them, their workers and their communities. Visit www.smallbusinessforamericasfuture.org. Follow us on Twitter and Facebook. #SmallBizAF.