Wells Fargo announced last week (Jan. 28) a $20 million donation as part of an initiative to help Atlanta financially-strapped, pandemic-whipped small business owners.The funds would help small business owners own more of their businesses’ assets –including property and equipment–to enable physical upgrades to their facilities.
The United Way of Greater Atlanta—in collaboration with Invest Atlanta—will distribute the funding as a mix of grants and loans in the city, with a focus on Black-owned and other diverse-owned businesses.
“This Wells Fargo grant program gives small business owners the opportunity to grow and expand by owning more of their own assets—which can be a game changer for the financial health of any business,” said Mayor Andre Dickens.
“As a former small business owner, I understand the vital role of small businesses in Atlanta’s economy and community, and we are excited to announce this program in the first few weeks of our new administration.”
Joining Dickens at the news conference were Wells Fargo CEO Charles Scharf , U.S. Rep. Nikema Williams (D-GA) and United Way of Greater Atlanta CEO Milton Little. “Almost 70% of black families are liquid asset poor compared to just 22% of white households,” said Milton Little, President and CEO of the United Way of Greater Atlanta.
“Today, the median household income for Black folks is one-third of that of whites. And the stats are much better for Latino brothers and sisters who maintain a median household income of just about half that of whites. Sixty-six percent of Latino families are asset poor.”
The donation comes from Wells Fargo’s Open for Business Fund—a roughly $420 million fund the company created in July of 2020 to help small businesses stay open during the COVID-19 pandemic.
The fund has focused on racially and ethnically diverse small businesses, which have been disproportionately impacted by the pandemic. The fund was created from the gross processing fees Wells Fargo made from administering Paycheck Protection Program loans in 2020. Wells Fargo has collaborated with Community Development Financial Institutions (CDFIs) and local nonprofits across the nation to distribute funding.
“The goal of this program is to change those statistics through the Wells Fargo open for business fund in collaboration with our friends at Invest Atlanta. We are going to empower entrepreneurs and small businesses all across Greater Atlanta, we are going to change the economic trajectory for those individuals, those families, those communities and for the region itself, ” Little said.
U.S. Rep. Nikema Williams (D-GA) said she heard from her constituents regarding concern for their businesses related to the risks related to COVID-19.
“This additional $20 million investment in Atlanta small businesses and minority owned financial institutions goes a long way towards supporting our entire community,” Williams said. “Already open for business grant funds have gone to Operation Hope, Morehouse College and access to capital for entrepreneurs.
Beyond the Open for Business Fund, your investments have supported true Atlanta History, Citizens Trust Bank, the first black owned bank in the United States to become a member of the FDIC,” Williams added. United Way of Greater Atlanta, with expertise from Invest Atlanta, will administer the $20 million donation around four initiatives:
- Small Business Loan Fund — Low-cost loans, capped at an interest rate of 3%, are designated to help small businesses grow ownership of tangible assets.
- Asset Building Assistance — Working with nonprofit organizations, including in south and west Atlanta, this effort will enlist experts to craft asset-building strategies for roughly 200 small businesses, such as moving from renting or leasing commercial space to owning it.
- Façade Improvement Grants — Grants of up to $50,000 for exterior improvements for small businesses that contribute a 20% match to their project.
- Commercial Ownership Growth — Capital to help small business owners facing rising rental costs, including down payment assistance grants of up to $200,000 to purchase commercial real estate.
Wells Fargo’s Open for Business Fund objectives are to reach more than 152,000 small business owners nationally and help entrepreneurs maintain more than 255,000 jobs. Roughly 85% of small businesses served by grantees are Black, African American, Hispanic, Asian American, and Native American small business owners.