Hyphen, Next Street and Other Partners Announce Next Phase for Cross-Sector Initiative to Expand Capital Access to Entrepreneurs of Color
Biden-Harris Administration officials, corporate and philanthropic stakeholders, and state SSBCI administrators align to leverage $10 billion in federal funding for BIPOC small businesses in nine states.
At a roundtable convened by The White House, U.S. Department of the Treasury, and U.S. Department of Commerce, Hyphen announced the next phase for the Initiative for Inclusive Entrepreneurship (IIE), a $100 million initiative to increase capital flow to entrepreneurs of color announced by Vice President Harris in October 2022.
Hyphen will partner with three leading innovators—Founders First Capital Partners, JumpStart, and Next Street—to support capital providers serving small businesses owned by people of color. With lead support from JPMorgan Chase, Skoll Foundation, Mastercard Center for Inclusive Growth, and W.K. Kellogg Foundation and expected support from the John D. and Catherine T. MacArthur Foundation and Wells Fargo, IIE will work with nine states—California, Illinois, Kansas, Michigan, New Mexico, New York, Ohio, Tennessee, and Washington—to capitalize the historic, $10 billion in funding from the American Rescue Plan through the Treasury Department’s State Small Business Credit Initiative (SSBCI). IIE will also be adding one to two Tribal Nations once applications are approved.
“SSBCI is primed to be the most significant small business program in U.S. history,” says Archana Sahgal, Hyphen’s Founder and President. “We are eager to continue working with our cross-sector partners to ensure that SSBCI benefits are maximized for the historically underserved communities that need them most and this once-in-a-generation funding opportunity lives up to its potential to create lasting systemic change.”
Roundtable participants discussed opportunities to leverage private and philanthropic support to strengthen federal and state efforts to advance racial equity within the small business ecosystem and create lasting systemic change for entrepreneurs who have historically had limited access to capital. Those present at the meeting included Deputy Assistant to the President and Domestic Policy Advisor to the Vice President, Carmel Martin; Deputy Secretary for the U.S. Department of the Treasury, Wally Adeyemo; Under Secretary for Minority Business Development at the U.S. Department of Commerce, Donald R. Cravins, Jr. Corporate and Philanthropic stakeholders in attendance included representation from JPMorgan Chase, Mastercard Center for Inclusive Growth, Skoll Foundation, and Wells Fargo. Representatives from IIE’s priority states—California, Illinois, Kansas, Michigan, New Mexico, New York, Ohio, Tennessee, and Washington—were also in attendance.
At the roundtable, Hyphen laid out the multi-faceted approach the organization and its partners will be taking to achieve IIE’s goals. This includes raising and deploying $20 million in grants to build the capacity of capital providers, raising $50 million in philanthropic program- and mission-related investments, and unlocking $30 million in private capital to drive systemic change and help states meet minimum match requirements, and establishing a central hub to enable collaboration, address gaps, and coordinate learning and evaluation. Founders First Capital Partners will be leading the IIE’s efforts to enable the growth and scale of BIPOC suppliers. JumpStart will be leading the high-growth vertical to convene venture capital stakeholders to build awareness of SSBCI. Next Street will be leading the Main Street vertical to accelerate the impact institutions and advisors have on small businesses.
“The State Small Business Credit Initiative is a transformational program for America’s small, minority, and other underserved businesses. The Minority Business Development Agency is working to ensure businesses are ready to access capital from this historic program,” said Donald R. Cravins, Jr., Under Secretary of Commerce for Minority Business Development. “Through the Capital Readiness Program, MBDA is awarding $100 million in grants to launch a National Network of incubators and accelerators designed specifically to get entrepreneurs capital ready for SSBCI and other funding opportunities. MBDA and the Biden Administration will continue to work with intention to make entrepreneurship this Nation’s most effective tool for economic equity and success.”
“Small businesses are the backbone of the economy and their success creates stronger communities,” said Heather Higginbottom, Co-Head of Global Philanthropy and Head of Research & Policy, JPMorgan Chase. “We are excited to support the Initiative for Inclusive Entrepreneurship as a way for public and private sector organizations to support business owners and entrepreneurs. The initiative will bring critical resources needed for growth and scale, which are often not equitably available, to participating businesses.”
“Public-philanthropic collaboration is key to SSBCI implementation in Kansas,” says Steve Radley, CEO, NetWork Kansas. “NetWork Kansas is excited to partner with IIE to help underserved entrepreneurs of color startup and grow successful businesses in the Sunflower State.”
Hyphen is a first-of-its-kind organization unlocking billions of dollars in federal investments for people of color and historically marginalized communities. The organization has been working closely with the Biden Administration to implement the $4 trillion worth of policies passed since he took office, including the American Rescue Plan (ARP) which allotted $10 billion in funding to the Department of Treasury’s State Small Business Credit Initiative (SSBCI).
In 2022, Hyphen worked with Vice President Kamala Harris to launch the IIE, a $100 million national effort to leverage that funding for entrepreneurs of color. The organization will manage and incubate IIE through mid-2024, breaking down the barriers keeping BIPOC business owners from accessing capital and ensuring this once-in-a-generation funding opportunity to uplift communities of color is not wasted.
For further details on Hyphen, please visit www.hyphenpartnerships.org.
About Hyphen:
Hyphen is a first-of-its-kind, women-led organization accelerating structural change for millions of Americans and people of color. Leveraging over $420 million in funding through federal policies like the American Rescue Plan, the Infrastructure Investment and Jobs Act, and the Inflation Reduction Act, Hyphen catalyzes philanthropic leadership and investment to maximize the benefits of these policies for low-income families, communities of color, and other marginalized populations. Hyphen’s work strengthens public safety, expands economic opportunity and safety-net programs, and ensures equitable outcomes from infrastructure rebuilding. The organization collaborates with federal agencies, philanthropic groups, state and local governments, and nonprofits to drive progress forward and pave the way for a more equitable future. Learn more at www.hyphenpartnerships.org.
About Founders First Capital Partners:
Founders First Capital Partners (FFCP) is building a comprehensive ecosystem to advance underrepresented founders becoming leading, premium-wage job creators within their communities. Since 2015, FFCP and its 501c3 CDC accelerator have helped grow over a thousand B2B and B2G diverse-led companies led by women, people of color, military veterans, members of the LGBTQ+ community, and those located in LMI communities. Founders First has pioneered using alternative growth capital, like Revenue-Based Financing, paired with advisory services to enable diverse suppliers to increase the value of their companies, create premium wage jobs, and build wealth. For more information, visit foundersfirstcapitalpartners.com.
About JumpStart:
JumpStart is a nationally recognized venture development organization providing capital, services, and connections to help entrepreneurs grow and corporations innovate. To learn more, visit jumpstartinc.org.
About Next Street:
Next Street designs and develops solutions to connect entrepreneurs and small business owners with the right resources at the right time, with a focus on small businesses facing disproportionate barriers. With a proven track record of nearly 20 years, an ongoing commitment to becoming an anti-racist organization, and an extensive network of small business advocates, operators and investors, Next Street is accelerating the impact of institutions and advisors on small businesses and providing millions of business owners with the experts, tools and capital they need to thrive. Learn more at nextstreet.com.