Over the next two years, Access to Capital for Entrepreneurs (ACE) commits to launching Women Investing in Successful Entrepreneurs (WISE) program to provide access to capital combined with business advisory services for women who are starting or expanding a business in rural north Georgia and the metropolitan Atlanta region. ACE will implement this plan by creating a $2.5 million revolving loan fund specifically for women and offering technical support through individualized business consultation, mentoring, and educational opportunities to more than 225 women entrepreneurs.
With the new WISE program, ACE will scale-up and expand its commitment to women by using a model that has proved effective with small business since the organization's inception: affordable loans combined with business advisory services. This program, however, marks the first time ACE has created an initiative tailored specifically for women entrepreneurs and their distinct needs. Traditionally, the majority of ACE's clients have been women - around 52 percent - but those numbers dipped during the economic recession. ACE has set a goal of deploying $2.1 million over the next two years to approximately 30 women-owned businesses along with recruiting more female investors to provide capital for the WISE revolving loan fund. ACE will identify women entrepreneurs for loans and mentoring through existing and developing relationships with professional business organizations for women.
ACE will launch an outreach campaign targeting women-owned businesses that will include hiring a WISE Program Director, developing marketing materials, creating a media blitz and developing an education tour to promote the initiative to regional associations and potential financial partners, funders, including large commercial banks. ACE will work with financial partners and funders to raise $2.5 million in loan capital over the two-year period and $500,000 in grants for developing and operating the WISE program. A unique social impact investment note is also being created and ACE plans on raising $750,000 for loan capital through this note. ACE has already secured $500,000 in loan capital from the Calvert Foundation's Women Investing in Women Initiative (WIN).
ACE has 12 years of success as a community lender (CDFI), bringing experienced management, lending, and administrative staff to every project, and the nonprofit organization's diverse Board of Directors claims several innovators who have shattered the 'glass ceiling' in their respective fields. Their vision, contacts, and dynamism are certain to advance this initiative for outreach, business contacts, and fund development.
Over the course of this two-year initiative, ACE will create a $2.5 million revolving loan fund for affordable business loans to approximately 30 women-owned businesses. Additionally, ACE will provide at least 225 women entrepreneurs to receive business development services.
-ACE will survey 20 selected women entrepreneurs regarding their capital and business development concerns and needs and will host a focus group to gain insight on program design.
-ACE will establish an advisory board of seven women whose role will include: assisting with WISE program development and outreach strategies to entrepreneurs and funders; assessing progress towards goals; and helping with network connections for WISE participants.
-ACE will develop marketing and informational materials to promote WISE.
ACE will host a launch event in partnership with the Calvert Foundation at the Federal Reserve Bank of Atlanta.
-ACE will host one WISE training seminar for 25 women.
-ACE will secure $500,000 in loan capital and provide $100,000 in loans to women-owned businesses through the WISE program.
-ACE will hire a Program Director for the WISE Initiative.
-ACE will launch a regional marketing campaign to promote WISE.
-ACE will hold a women's entrepreneurship conference, in partnership with women's professional business associations.
-ACE will offer business education opportunities for 100 women through web-based training, seminars and individualized business consultation.
-ACE will launch a mentorship program to connect high growth businesses with experienced, but smaller businesses; and those smaller, experienced businesses with new, start-up businesses.
-A legal firm will assist ACE in creating an investment note for an offering to accredited investors. ACE will also pursue crowd-funding for non-accredited investors. ACE will work with financial partners and funders to raise $1 million in debt capital for relending and $250,000 in grants and donations for operating the WISE program. ACE will provide $1 million in loans to women entrepreneurs.
-ACE will offer business education opportunities for 100 women through web-based training, seminars and individualized business consultation. The syllabus will be developed based on the survey conducted regarding capital and business development concerns.-ACE will continue its peer mentorship program to connect high growth businesses with experienced, but smaller businesses; and those smaller, experienced businesses with new, start-up businesses.
-ACE will work with financial partners and funders to raise $1 million in debt capital for relending and $250,000 in grants and donations for operating the WISE program.
-ACE will provide $1 million in loans to women entrepreneurs.
The remaining $400,000 will be deployed in the following year, 2016, after the completion of this commitment.
Women need more access to business capital and greater financial skills and capabilities. The financial industry remains male-dominated, and women often find themselves excluded from networks that provide information, contacts, and mentors to men. The National Association of Women Business Owners found that a quarter of women entrepreneurs did not seek new loans or lines of credit because they believed they would be turned down, and, in fact, loan approval rates for women-owned companies are 15 to 20 percent lower than their male peers. The Kauffman Foundation reports that 260 out of 100,000 women in the U.S. (or 0.26%) were involved in entrepreneurial activity in 1996 but, by 2011, the proportion had fallen to 230.
Importantly, women are more likely than their male peers to reinvest their business profits in education or business growth, and to embark on projects with broader social goals and contribute to industry innovation. Moreover, women-owned businesses employ more workers than the largest 500 companies combined, according to The Economist, which projected that if they started their businesses with the same capital levels as male counterparts, women would add six million jobs to the economy in five years -- two million in the first year alone.
Specifically, Georgia leads the country in bank closures, with more than 90 institutions closing in recent years and surviving lenders severely restricting their business loans. This resulting credit crunch has proved especially challenging for women, who statistically own fewer assets to use as collateral for borrowing, and often lack the 'separate income' that helps loan applicants qualify. Research at the Kauffman Center for Entrepreneurial Leadership has identified other factors that sometimes inhibit women in entrepreneurial roles, including issues in self-confidence, willingness to take risks, workplace discrimination, and family-work balance. While Georgia ranks first in the growth rate for women-owned businesses it is ranked 21st in revenue growth and 13th in employment growth.
ACE has identified at least 15 WISE women clients whose businesses have high growth potential. ACE plans to offer these clients intensive one on one financial coaching and other services as identified by the group in consultation with ACE, to support them in reaching established growth goals. ACE is seeking grants and donations in the amount of $150,000 for costs associated with providing financial coaching and other services to these clients. ACE is also seeking $25,000 to support third party evaluation of the processes and outcomes of the WISE initiative. Because of the success of the WISE initiative and demonstrated need for capital for women business owners, ACE is seeking $1,000,000 in low interest debt capital.