Creating Flexible and Affordable Financing Opportunities for Businesses in Fort Worth
The City of Fort Worth is looking to scale its supply of flexible, affordable, and patient financing through community development financial institutions (CDFIs). By 2028, the city seeks to increase its CDFI spending from $39 per person to the US average of $235 per person, gaining 125-$250M in new CDFI financing for businesses and entrepreneurs. To support this goal, Fort Worth will partner with FUSE Corps to build a permanent, sustainable CDFI friendly system in the city.
It's been just over a year since pharmaceutical companies launched vaccines in the fight against Covid-19, ushering in hope for the end of the pandemic, lockdowns, and social distancing from friends and loved ones. With this promise, the economy began to rally, consumers broadened their spending, and business growth and activity increased. However, small businesses and entrepreneurs, who comprise the heart of the American economy, continue to face challenges arising from the pandemic. This includes being unable to receive financial assistance due to a lack of financial readiness/literacy and access to capital. This is a unique challenge for small businesses and entrepreneurs of color. These households have lower pre-existing levels of wealth and savings to put towards a business. At the same time, banks and other creditors are less likely to approve loans for Black or Hispanic small-business owners than white business owners. Without upfront capital to invest in their businesses, entrepreneurs of color continue to struggle to run or pivot their operations to meet the unprecedented businesses challenges arising from the pandemic.
The City of Fort Worth was recently ranked as the nation's ninth-best large city to start a business, ranking high for its overall business environment and access to resources. However, Fort Worth was noted as falling short in business costs – with unequal access to capital as a significant obstacle to launching and sustaining a business in the city. To address this challenge, the city is looking to scale its supply of available financing through expanding community development financial institutions (CDFIs). CDFIs are private financial institutions that are 100% dedicated to delivering responsible, affordable lending to support small business owners, affordable housing developers, non-profits, consumers, and commercial real estate in historically under-served communities. By 2028, the city seeks to increase its CDFI spending from $39 per person to the US average of $235 per person, gaining 125-$250M in new CDFI financing for businesses and entrepreneurs.
The City of Fort Worth will partner with FUSE Corps to build a permanent, sustainable CDFI friendly system in the city. The FUSE Executive Fellow will collaborate with CDFI Friendly America to utilize their national expertise and success in Bloomington/South Bend, IN, and work to understand where there are financing gaps in the city that CDFIs can fill, how the city can best work with CDFIs, and how to attract more CDFIs to the city by making it easier for them to identify the opportunities they can finance. The Executive Fellow will also build the financial literacy and preparedness of local entrepreneurs and businesses to ensure they can access these new opportunities for capital. This work will supply entrepreneurs, businesses, and developers with flexible, affordable, and patient financing, and as a result, Fort Worth will be more vibrant, economically stronger, and more resilient.
Starting in April 2022, it is proposed that the FUSE Executive Fellow will work to quickly build working relationships with a wide range of critical stakeholders. This will include identifying and conducting outreach to local financial institutions in the city (banks, lending institutions, credit unions, CDFIs), community leaders, community-based organizations, local business leaders, chambers of commerce, and city officials. The Executive Fellow will convene small focus groups of these stakeholders, collecting and analyzing quantitative and qualitative information. This information should clarify capital gaps, the rates of minority and women-owned businesses accessing traditional forms of capital, the financial literacy of entrepreneurs and developers in various neighborhoods, and the perceived potential benefits/roles of CDFIs in Fort Worth.
The Executive Fellow will build coalitions of these stakeholders and convene them at an in-person conference in July. The Executive Fellow will coordinate the planning and delivery of this conference – setting logistics, such as invites and conference space, and facilitating the day-of schedule of events. This conference aims to build consensus around Fort Worth's financing goals and strategies, ensuring CDFIs can easily find and finance opportunities in the city. The Executive Fellow will prepare 'deal sheets' for each business or development program, pairing these entrepreneurs and development projects with financial institutions, including local and national CDFIs. The Executive Fellow will support the business or development program in utilizing these deal sheets to build partnerships with these financial institutions to facilitate immediate investment. The Executive Fellow will follow this portfolio of partnerships and potential investments closely over the next nine months, ensuring the entrepreneurs and developers are successful in acquiring this capital and preparing them to report back to the financial institutions on utilization of the capital.
The Executive Fellow will operationalize a sustainable system for matching businesses and development projects with investments in the next phase. This will include developing a comprehensive and easily digestible toolkit for community use that outlines critical financial literacy principles, investment application requirements for various financial institutions, and the processes for transiting from non-traditional financial institutions (such as CDFIs) to traditional financial institutions (banks) for sourcing capital. The Executive Fellow will develop a platform that captures eligible businesses and development projects and notifies financial institutions of high priority and applicable investment opportunities. This platform should also reach CDFIs outside of Fort Worth, attracting additional funders to the city. Based on the success of the July conference, the Executive Fellow may also prepare a schedule of convenings to support building these partnerships and addressing challenges the community faces in accessing financing in person. By April 2023, the Executive Fellow will have overseen the following deliverables:
Build robust relationships and convene internal and external stakeholders – Demonstrate cross-cultural agility and successfully engage with all relevant stakeholders; develop working relationships with all relevant departments in Fort Worth, community-based organizations, community leaders, local business leaders and owners, chambers of commerce, and financial institutions; convene stakeholders and tailor these conversations to ensure the entire Fort Worth community comes together, learns, and understands how CDFI financing can benefit under-resourced entrepreneurs or potential developments
Prepare and launch a convening for sourcing investments in July 2022 – Build coalitions of stakeholders to invite to the conference; prepare logistics and facilitate the in-person event; develop deal-sheets for entrepreneurs, small businesses, and development projects, connecting them to various financial institutions – ensure 'matches' meet the needs of both parties, such as the business being equipped to complete the technical requirements of receiving the investment and the financial institution benefiting by meeting CRA requirements
Operationalize a sustainable program for financing under-resourced business and development projects – Develop ways to provide financial literacy and educate to the community consistently; form a toolkit for accessing capital and utilizing CDFIs; build out a platform for capturing eligible businesses and development projects and notifying financial institutions of high priority opportunities (ex. project is in a neighborhood that has been traditionally underinvested or is a high community priority) or those that are generally applicable to that institution; prepare a multi-year schedule of convenings, creating feedback loops between the community, city, and local financial institutions; garner best practices and lessons learned, addressing on-going challenges
Project Supervisor – Christina Brooks, Chief Equity Officer, Department of Diversity and Inclusion
Robert Sturns, Director, Department of Economic Development
At least 15 years of professional experience in banking or banking administration; familiarity with the regulations of the Community Reinvestment Act (CRA) a significant benefit
Robust success in managing financial literacy programs; having translated complicated financial requirements into simple terms
Must be able to work non-traditional hours with schedule flexibility
Experience working in politically charged environments
Some experience with community engagement essential
Proven success in cultivating partnerships, relationship and coalition building, and fostering collaborative environments
A self-starter and entrepreneurial leader who can drive action-oriented solutions/recommendations
Excellent stakeholder engagement skills and the ability to use facilitative leadership techniques to coordinate stakeholder activities
Flexibility, adaptability, persistence, humility, inclusivity, and sensitivity to cultural differences
Ability to sustain progress within potentially ambiguous environments
Exceptional written and verbal communication skills with an ease in public presentations