Black small business owners starting or expanding a business can now perhaps get some fresh capital from the African American Chamber Fund (AACF). The new fund, a program led by Jersey City, New Jersey-based World Business Lenders, will initially offer up to $10 million in loans to black businesses.
Borrowers must seek financing through a U.S. based African American Chamber of Commerce office, a move to help ensure loans are made in black business communities.
World Business Lenders (WBL) has compiled an elite list of “Board of Managers” for the AACF. The list consists of high-profile individuals with political, business, spiritual, and athletic backgrounds who will reach out to local chambers to affiliate with.
Also known as advisory board members, they include U.S. Congressman Ed Towns (D-NY), Washington, D.C. Archbishop David J. Billings III, World Business Lenders CEO/Founder Doug Nadius, as well as Bob Beamon and Jackie Joyner Kersee, both Olympic gold medalists. Derrick Chambers, program manager of AACF/WBL, is a former NFL player for the Jacksonville Jaguars.
Organizers report there are currently 2.6 million black-owned businesses in the United States, employing 975,000 workers across the nation and generating $150 billion in annual receipts.
“Clearly, African American entrepreneurs are a driving force in our nation’s economy but, like all minority groups, they have more difficulty getting access to capital,” Bishop Billings, Fund Vice Chairman stated publicly earlier this year. “Our goal is to ensure that the opportunity to thrive is available to every single one of these entrepreneurs who want to create more economic growth for our communities.”
An alternative lender, WBL allows borrowers to use real estate as collateral to get short-term business loans. Its AACF unit can make unsecured loans based on the guidance and insight borrowers receive from a local chamber. The bottom line is borrowers can pursue loans they might not from traditional lenders like banks.
Currently, the AACF has launched the program with the African American Chamber of Commerce of New Jersey, the Greater Harlem Chamber of Commerce in New York, and the Caribbean Chamber of Commerce and Industry in Brooklyn, New York.
The AACF is in talks with other black chambers nationally, including the Illinois Black Chamber of Commerce in Chicago and the Mississippi Black Chamber of Commerce in Jackson to affiliate with the fund, Chambers says. He added the AAFC will also determine whether to make loans to black businesses at a local chamber outside of their business location.
AACF borrowers can seek loans ranging from $25,000 to $2 million. Chambers figures the average size of a typical loan will be from $25,000 to $100,000. He added the criteria to receive a loan will be based on an interview about the applicant’s financial background, why they need the loan, and other factors. Loan participants can use the money for business purposes, including buying equipment, inventory, as well as cash flow for payroll.