Despite the potential of diverse businesses to be powerful economic catalysts, many of them face persistent inequalities and structural barriers. Access to capital has long been the main obstacle to the growth of diversified businesses, in particular access to capital at competitive prices. To this end, EEF will work to accelerate the growth of high-potential emerging companies with diverse owners by making direct equity investments and improving access to non-predatory sources of capital, including financing. revenue-based and low-cost working capital.
“Everyone, regardless of race or background, deserves an equal chance to achieve their dreams. Unfortunately, in America, the color of your skin and where you grew up are the most reliable predictors of economic success. We believe that investing in underrepresented entrepreneurs and diversity-owned businesses will be an effective and efficient way to forge a more inclusive economy, reduce wealth and employment gaps, and strengthen our democracy,” said declared Tyra A. MarianiPresident of the Schultz Family Foundation.
According to a September 2020 Citi reportproviding fair and equitable loans to only black entrepreneurs over the past 20 years would likely have resulted in the creation of a $13 trillion in turnover and potentially created 6.1 million jobs per year.
The data suggests that building high-potential emerging companies led by diverse founders (e.g., companies growing in revenue at an annual rate of 15%) and positioning these companies to become middle-market companies (for example, generating annual revenues of $10 million at $1 billion) has the potential to be a powerful way to increase economic and social outcomes for historically disadvantaged communities.
Recognizing that all businesses need more than capital to grow, EEF will also underwrite philanthropic grants designed to improve the operating environment for underrepresented entrepreneurs and businesses with diverse interests by supporting them through training. , executive mentoring, data collection, research and policy development.
To lead the effort, the Schultz Family Foundation hired david hinson as Managing Director and Head of EEF. With over 20 years of leadership experience, Hinson brings deep knowledge of capital access, acquisitions, and global business development for diversely owned businesses. Prior to joining the Foundation, he served as Senior Vice President in the Private Wealth Services division of Ategra Capital Management LLC. Previously, Hinson served as National Director of the Minority Business Development Agency at the US Department of Commerce during the Obama administration. In this role, David served as the administration’s lead advisor on the growth and global competitiveness of the nation’s eight million minority-owned businesses. David led the Agency to its best performance in five years, delivering over $19 billion in contracts and capital to various companies. Prior to joining the Obama administration, David was founder and president of Wealth Management Network, a New York Citywealth management advice. He has also held senior positions at Envestnet and Bank of America.
“There are a growing number of innovative, growth-oriented, diversely-owned companies ready to join the middle market. But for too many, capital is out of reach because too often, capital is directed to the best relationships, not the best deals,” Hinson said. “By supporting these businesses, we believe they will not only outperform in terms of financial returns, but will lead the way in creating positive social outcomes, jobs and wealth in historically underserved communities.”
About the Schultz Family Foundation
The Schultz Family Foundation, established in 1996 by Sheri and Howard Schultz, creates pathways of opportunity for populations facing barriers to success, focusing on youth transitioning to adulthood and marginalized populations, including Black, Indigenous, and People of Color. By investing in scalable solutions and partnerships in communities across the country, the Foundation aims to help overcome barriers and obstacles that prevent individuals from reaching their full potential and, in doing so, strengthen our communities and our nation. For more information about the Foundation and its work: schultzfamilyfoundation.org.
SOURCE Schultz Family Foundation