John,

Through our work at Common Future, we see time and time again that despite small businesses being the lifeblood of our economy, structural racism built into our financial system has caused huge barriers to resources and support for small business owners of color.

It costs an average of $30,000-40,000 to get a small business off the ground. Some small business owners can rely on friends and family for support, but in the absence of generational wealth resulting from decades of extraction and disinvestment, BIPOC business owners have fewer options. Turning to banks may not be an option given deeply embedded historically racist underwriting and pricing practices that are extractive or exclusionary to borrowers of color.

That’s why we’re investing in lending options that center BIPOC entrepreneurs and are designed with inclusivity, trust-building, and justice in mind. We believe our investments into two Revenue-based Finance (RBF) Funds could be just that. You’re invited to learn more in a webinar with Common Future and our partners on March 7th at 1pm EST/10am PST.

Businesses with an RBF loan pay it back on a variable schedule that is based on the business’ revenue. For example, if a business has $100 in revenue and a 5% revenue-based payment per month, it will repay $5. If it runs into hard times and has $0 revenue month, it will repay $0 that month.

We think RBF is a valuable type of flexible financing that, when designed and implemented with respected community leaders, can support the growth of BIPOC businesses—and we’re so thrilled to share more about this innovative strategy with you.

If you’re interested in learning more about our latest initiative to deploy flexible, community-driven capital to BIPOC businesses, join us for a webinar on March 7th at 1pm EST/10am PST to learn from our partners on the ground—Tucson-based Startup Tucson and Community Investment Corporation, and WEPOWER in St. Louis—about their local entrepreneur ecosystems and why this type of flexible financing makes sense for their communities.

In solidarity,

Eric Horvath
Director of Capital Strategies
Common Future