Economy League of Greater Philadelphia is the recipient of a $300,000 grant from the U.S. Department of Commerce that will go toward a future program to bring capital and business connections to Black and brown founders.
The grant comes from the Economic Development Administration’s (EDA) Build to Scale program which consists of three separate competitions — the Venture Challenge, Capital Challenge and Industry Challenge.
The Economy League was awarded grant money in the Capital Challenge, which seeks to increase access to capital in cities and communities where risk capital is in short supply. Economy League Executive Director Jeff Hornstein told Technical.ly the grant will primarily fund the start up of PAGE Procurement Prep, a business development program aiming to help local Black and brown entrepreneurs build their businesses’ capacity to work with institutional supply chains that are usually controlled by “anchor institutions” and large corporations.
PAGE stands for Philadelphia Anchors for Growth and Equity, a preexisting program with a goal to get more large institutions, like the city’s eds and meds systems, to purchase from local businesses, thus “localizing more of the hundreds of millions of dollars of addressable local institutional spend.” It hopes to engage 100 new businesses by the end of 2021 — including 50 in the prep program.
PAGE Procurement Prep is a joint project of the Economy League, Impact PHL, Social Venture Circle, the African American Chamber of Commerce for Greater Philadelphia and the Greater Philadelphia Hispanic Chamber of Commerce. By involving ImpactPHL and Social Venture Circle, Hornstein said he hopes more impact investors will come to the table from the beginning.
“Access to capital is a key barrier to success for diverse businesses, in particular lack of access to equity capital,” he said. “We want investors to share the risk with entrepreneurs as they scale up to meet demand from institutional supply chains. Black and Brown-owned firms are saddled with debt, which inhibits growth.”
The $300,000 grant meets part of the program’s needed $500,000 for its pilot program, and program leaders are seeking to raise the rest a mix of philanthropy, bank foundations or corporate sponsors. It’s also seeking banks, home offices and impact investors to deploy capital or grants to future participants.
Hornstein said the orgs need to raise those funds to build out the program completely, but the goal is to launch in the first quarter of 2021. The group hopes to bring two cohorts of 25 businesses through the program over the course of a two-year pilot.
The orgs also had a “very successful” procurement roundtable in August, attended by the University of Pennsylvania, Penn Medicine, Drexel University, Jefferson, Temple University, CHOP, Aramark, Comcast, Independence Blue Cross and PECO, and are “in the process of getting commitments to shift institutional spend to local Black and Brown-owned firms in targeted sectors,” Hornstein said.
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