Women entrepreneurs across Michigan are getting a new source of much-needed financial help from one of the state’s leading women’s groups.
Michigan Women Forward on Thursday announced the launch of a $10 million microbusiness loan program for women and entrepreneurs of color. The program, called the Michigan Economic Opportunity Fund, offers funds to small business owners who may not qualify for traditional loans through banks or other financial institutions.
Approved entrepreneurs will receive loans ranging from $5,000 to $50,000, according to Michigan Women Forward President and CEO Carolyn Cassin. The microloan program will offer opportunities to women entrepreneurs who identify as socially and economically disadvantaged due to a lack of access to capital and credit.
“You have a lot of women business owners with great products and services. They just need a boost that can push them to another level,” Cassin told Crain’s. “Some business owners have to go after alternative ways to get funding to scale up their businesses, and they should not have to do that. Small businesses are the backbone of our economy. This program will help so many people and communities. We're really excited about this.”
Funding for the new program comes from a variety of partners, including:
- $1.5 million investment from program launch partner Huntington Bank
- $1.5 million from Ballmer Group, run by Los Angeles Clippers owner and Detroit native Steve Ballmer and his wife Connie
- $1.494 million from a State Small Business Credit Initiative loan
- $1 million from the Michigan Economic Development Corp.
The remaining funds from private partners will be announced later this year.
The SSBCI program provides federal funding to states to aid small businesses in accessing capital to invest in job-creating opportunities as the country emerges from the COVID-19 pandemic. The funding comes as part of the federal government’s SSBCI 2.0 program, for which Michigan received its first round of funding in August.
Michigan Women Forward will manage the Michigan Economic Opportunity Fund by processing applications through its website, along with referrals made by its banking institution partners. Huntington Bank will provide an additional pool of applicants through its Lift Local Business program that supports minority-, women- and veteran-owned small businesses.
Sandy Pierce, Huntington Bank senior executive vice president and chair of Michigan, said such programs are important to the financial institution.
“Programs like the Michigan Economic Opportunity Fund are excellent resources to aid business owners who may not otherwise qualify for traditional loans through banks or other financial institutions,” Pierce said in the release. “We are proud to work with Michigan Women Forward, the Michigan Economic Development Corporation, and the Ballmer Group to bring this new lending solution to fruition.”
The program can help in cutting off some systemic inequities, Ballmer Group Southeast Michigan Executive Director Kylee Mitchell Wells said.
“CDFIs play a vital role in ensuring that low-cost capital is available to more communities and individuals, such as entrepreneurs of color and women, who have been locked out of traditional capital markets,” Wells said in the release. “We are thrilled to support this fund as part of Ballmer Group’s commitment to working with government, nonprofit, and business partners to help strengthen our communities.”
An average loan managed by MWF is $25,000, so the Michigan Economic Opportunity Fund will be able to assist approximately 400 entrepreneurs. Last year, the nonprofit provided 91 loans for a total of $2.6 million for primarily women-owned businesses.
Women and entrepreneurs of color can apply for Michigan Economic Opportunity Fund loans by visiting the Michigan Women Forward website. Questions about the program can be emailed to [email protected] or call (313) 962-1920.
From Crain’s Detroit Business.