VEDC Receives Funds from Wells Fargo to Support Diverse Small Businesses
- 23.11.2016 06:45 am
Valley Economic Development Center, also known as VEDC, is one of 12 Community Development Financial Institutions (CDFIs) to receive funds from the Wells Fargo Works for Small Business: Diverse Community Capital program. Wells Fargo & Company recently announced it is providing $11.2 million in lending capital and grants in round two of the three-year program. Located in Sherman Oaks, CA, VEDC will receive $250,000 in grant funds and $2.25 million in lending capital. The six-round Diverse Community Capital program will provide a total of $75 million in lending and grant capital over three years to CDFIs that support diverse-owned small businesses. To date, this program has distributed more than $38 million to 30 CDFIs.
The $2.25 million will allow VEDC to expand their African American Small Business Loan Program outside of the Greater Los Angeles area to include all of Southern California. Many African-American small business owners have faced systemic challenges to securing loans from traditional sources. The VEDC program also offers training and free business consultations to address the specific needs of the African American entrepreneur wishing to start or expand their business.
VEDC anticipates a total of 450 entrepreneurs and small business owners will receive technical assistance through this program expansion and include 50 loan recommendations. Through this program, 20 new businesses will be created, 50 new jobs will be generated and 100 existing jobs will be retained.
“Small businesses create economic opportunities that extend well beyond the business owner by providing job opportunities and commercial growth in their communities,” said Robert Lopez, chief operating officer for VEDC. “Wells Fargo and VEDC have a strong history of supporting small business owners and we look forward to continuing our partnership by helping entrepreneurs start and build their businesses.”
Making a Difference: Concessionaire Expanding in California Airports
Palazzo Concessions was founded in 2008 by Simeon Stewart II as a certified Airport Concessions Disadvantaged Business Enterprise in the City of Los Angeles. When Simeon received his first contract with LAX he couldn’t qualify for traditional financing due to the startup nature of the business. He had been coming to VEDC for technical assistance and one-on-one business consultations regarding the unique financing and licensing requirements of an airport concession.
“VEDC looked at our forecast financials and took a chance. I’m proud to say that we have not missed a payment, have never been late and are almost paid off,” stated Palazzo Concessions owner, Simeon Stewart II. “We have now grown from one contract to 19 locations in three airports in California. We couldn’t have done this without the help of VEDC.”
“Our relationship with VEDC goes back 30 plus years and throughout that time, it’s been exciting to see the impact of our work together – because of this work more small businesses are thriving across Los Angeles,” said David DiCristofaro, lead region president of Wells Fargo in Greater Los Angeles. “We need small businesses to succeed financially, grow and add jobs for our communities to prosper and we want to make every responsible loan we possibly can to help creditworthy small businesses.”
The 12 organizations selected for round two were chosen from among 98 that indicated interest. Wells Fargo will distribute a total of $8.17 million in lending capital and $3.075 million in grants to the selected CDFIs. The DCC program launched in November 2015 by providing $4.45 million in loan and grant funds to three CDFIs and encouraging others to submit interest forms for the program’s first official round. More than 100 CDFIs responded, and Wells Fargo distributed a total of $5.67 million in grants and $16.67 million in lending capital to the 15 CDFIs selected in round one.