The Detroit Development Fund, JPMorgan Chase, and the W.K. Kellogg Foundation have announced that the Detroit-based Entrepreneurs of Color Fund has nearly tripled in size, from $6.5 million to more than $18 million, due to strong demand for capital and continued interest among investors in seeing all Detroiters benefit from the city's comeback.
As part of its five-year, $125 million commitment to Detroit's economic recovery, JPMorgan Chase, in partnership with Kellogg and the Detroit Development Fund (DDF), created the fund in 2015 to provide minority-owned small businesses with access to capital and technical assistance. JPMorgan initially invested $3.5 million in the fund, which Kellogg matched as part of its roughly $25 million investment in the city and commitment to more equitable development there.
To meet ongoing demand, JPMorgan Chase and Kellogg are each investing an additional $2 million in the fund and are actively recruiting new funders to join the effort. New investors to date include the Ralph C. Wilson, Jr. Foundation ($2.5 million), Fifth Third Bank ($3 million), and the Kresge Foundation, which has committed to providing first-loss guarantees of up to $2 million.
Facilitated by DDF, a 501(c)(3) community development financial institution (CDFI), the fund provides loans ranging from $50,000 to $200,000 as well as business assistance to Detroit entrepreneurs of color, enabling them to grow their businesses, hire locally, and contribute to the city's recovery. To date, the fund has lent or approved $4.5 million to more than forty-three minority small businesses, resulting in over six hundred new or retained jobs, with more than half (53 percent) the loans supporting minority women-owned businesses.
"The Kellogg Foundation developed and initiated this fund to dramatically change the wealth trajectory of people of color in the city and its neighborhoods," said WKKF president and CEO La June Montgomery Tabron. "Our commitment to the Entrepreneurs of Color Fund provides a pathway for community ownership, better jobs, and more opportunities. The goal is more equitable economic development and an increase of quality of life for the people of Detroit and their children."