Bridging Capital Gaps for Entrepreneurs of Color: EOCF Early Learnings
The team behind the Entrepreneurs of Color Fund (EOCF) recently took a look back at positive outcomes and experience working with CDFIs to expand access to capital for underserved businesses. "It is clearly possible to successfully implement inclusive lending policies,” writes LISC’s Steve Hall, who leads the EOCF work. "But it requires a different way of thinking about the process and a willingness to step back from traditional notions about risk."
By Steve Hall, LISC Vice President of Economic Development 6.15.2023
This week, I’ve been thinking about Juneteenth from the perspective of small business owners—particularly Black small business owners—and about the promise yet to be realized and the opportunities waiting to be built.
It is clear from years of data that conventional approaches to small business lending limit the prospects for many entrepreneurs of color. As a result, those owners aren’t able to access the capital they need to build, hire and grow.
What has been less obvious is what to do about it. Even as many financial institutions work to remedy historical discrimination, unconscious bias has remained a persistent drag on progress. It is a systemic thread in many aspects of marketing and underwriting, running through policies that may not be overtly tied to race or ethnicity but that nonetheless end up disadvantaging Black and Brown business owners.