Metro Detroit Black Business Alliance

Capital Connect prepares and connects Metro Detroit Black-owned businesses to various funding resources to ensure their sustained success. Our organization serves as the trusted partner for entrepreneurs, funders and technical assistance providers. Businesses receive much-needed technical assistance, support and advocacy from MDBBA to qualify for existing capital. Funders have access to qualified and prepared Black-owned businesses from MDBBAs growing pipeline. Service-based MDBBA members have a platform to provide technical assistance to our Capital Connect members and build their portfolio.

Each cohort runs approximately 12 weeks and focuses on business plan development, financial projections, pitch development, technical assistance and growth strategy development. The goal is that each participant will be fully equipped with a fundable loan package by the conclusion of the cohort and receive the funds needed to scale and sustain their businesses. 

To date we have received 225 total applications for our first two cohorts which yielded 28 participants. Cohort one required a $25K investment (not including staff cost) in technical assistance for 10 participants and generated $1.85M for 80% of the funding eligible participants. We anticipate that we’ll be able to exceed the funding amount for cohort two, which currently has 18 participants. 

The first two cohorts were/are led by our Chief Operating Officer, which has helped to keep costs low to prove the concept. We expect to hire staff in order for us to truly scale and duplicate these efforts long-term. 

The largest issue for Black entrepreneurs is access to capital. According to a study done by Bank of America, 56% of Black entrepreneurs say that access to capital is a lingering issue for them throughout the pandemic and beyond. Our program is uniquely designed to prepare Black entrepreneurs for several banks and CDFI’s in the Metro Detroit area by helping them craft their funding package. During this 12-week program, entrepreneurs craft a fully-developed funding package including a thorough business plan, financial projections, pitch, growth strategy and funding application. Our pilot program had a funding success rate of 80%, much higher than the typical funding success rate at 25% across all funder types (big banks, small banks, alternative lenders, and more), according to Forbes.

While most small business programs focus on entrepreneur education from a capacity building perspective, the Capital Connect program is exclusively built with the goal to get businesses funded. In the challenge overview, Truist is specifically looking for innovative programs that connect Black and women-led businesses to funders and investors. Our program is designed exclusively to help Black entrepreneurs scale and thrive by preparing and connecting them to available funding resources in the ecosystem. 

Today, we serve approximately 500 Black (85%) and diverse-owned businesses in the Wayne (77%), Oakland (17%), and Macomb (6%) counties of Michigan, with a heavy concentration of Detroit-based businesses. 96% of our members are identified as micro-small businesses (less than 50 employees) who generate less than $100K in revenues annually. Additionally, 70% of our membership base are women-led organizations. 

Many of our programmatic solutions are created as a direct result of our daily engagement with current members, as well as non-members who are often seeking resources to help support their businesses. We also have a competitive advantage over many organizations, as both our CEO and COO were former leaders in the City of Detroit government and specifically led the city's mitigation efforts during the pandemic in which many entrepreneurs were ravaged by the effects of closures. 

During this time, we worked with Ernst & Young to conduct research of the entrepreneurship ecosystem to understand the top pain points. In that survey, we learned that the top two issues were: Lack of trust by entrepreneurs of government and business serving organizations and Access to Capital. As we launched the Alliance in 2021, we made sure that we created core programs that restored the trust in entrepreneurs and helped them to access capital, thus the creation of our solution; Capital Connect. 

Currently, we have no plans to expand the Capital Connect program outside the state of Michigan. We believe that our current footprint of Black businesses in Metro Detroit has enough demonstrated need for support with access to capital from organizations like ours. Conversely, we do believe that some of our programming is scalable for other organizations with similar missions outside the state of Michigan. Long-term, this could become a goal of the Alliance, but as of today there are no plans. 

Our mission is to develop programs and advocate for policies that result in profitable and sustainable Black-Owned Businesses that are connected to public and private economic opportunities while building trusted relationships. We believe that to truly close the racial wealth gap, there needs to be a constant pipeline of new ideas, as well as an ecosystem that helps those businesses thrive. To that end, we support both the launching of new small businesses and sustainability of existing small businesses. 

In 2018, The Kellogg Foundation released a report titled, “The Business Case for Racial Equity”, outlining the racial wealth gap. The State of Michigan alone stands to gain $92 Billion dollars by 2050 if we close this sizable gap. We believe that one of the most impactful ways we can close this racial wealth gap is through Black entrepreneurship. Our Capital Connect program is our audacious endeavor to be the largest solution to the wealth gap issue in our community. With access to funding, best-in-class capacity building, and collective advocacy power, we will be the most impactful organization making this change. We have already experienced a success rate of 80% of the businesses that have participated in our cohorts being funded and will continue to perform at or above that level because of our unique approach to the problem. 

In designing our solution, we didn't only acknowledge the traditional stated barriers to Black entrepreneurs accessing capital, we also challenged our funding partners to address the often unstated barriers to funding. That willingness to challenge the status quo was what I believe has led to a shift in how we interact with our funding partners. I believe they respected our logical approach in saying "give us the answers to the exam and we'll bring you qualified business who can pass the exam." This approach is one that can be used by other organizations to help generate similar results in communities of color across the country. 

Currently serving: 28

Anticipated served in one year: 120

Anticipated served in five years: 700

Our community is defined by Black entrepreneurs and their advocates and allies (i.e. traditional banks, CDFIs, small business support organizations, CDOs, and government agencies) within the Metro Detroit counties of Wayne, Oakland, and Macomb counties. We heavily lean into advocacy as a main pillar of invoking change for entrepreneurs and consider local, State and Federal lawmakers, municipalities, legislators, and financial institutions as our stakeholders. 

Our organization is led by a dynamic, Black woman, who has years leading and coalition building at the highest levels of Detroit government to help drive more equitable outcomes in the City of Detroit. She is also recognized at the State level as someone who is doing the important work in the SE Michigan region needed to support those who have been largely marginalized, Black micro-small business owners. 

Our work consists of three pillars: programming, policy, and partnerships. We leverage our community and stakeholders to drive results and our greater mission to close the racial wealth gap:

Two core programs that set the foundation for MDBBA programming are the Capital Connect and Biz Wiz programs. Both of these programs are focused on finding solutions to the obstacles our members face from obtaining an operational license to accepting funding for scaling. Our financial institution stakeholders serve a key role in funding and supporting our entrepreneurs. Since implementing both programs, we've been able to secure over $5M in funding for Black entrepreneurs and provide more than $25,000 in free technical assistance.

Our policy pillar is carried out by our Truth to Power series. These events allow our members the opportunity to have a 1:1 conversation with Michigan elected officials. The goal is to create a conversation geared around supporting Black businesses as a whole before a crisis, like the COVID-19 pandemic, occurs. Our series has been attended by more than 100 MDBBA members.

Our partnership pillar is the bridge between ally organizations and our Black business owners. To date, we have partnered with over 50 organizations including the Detroit Pistons, Bank of America, Shopify, Comcast and Huntington Bank to offer resources to our members.

At the Metro Detroit Black Business Alliance, we engage in different types of outreach. Depending on the program, we employ various methods to reach businesses. Whether it's our monthly newsletters or daily use of our co-working space, we utilize a variety of social media outlets, direct marketing, email marketing, door to door canvassing and sometimes phone marketing. We also build relationships with trusted business serving organizations in each county (if available) to reach those hard to reach businesses. Lastly, we enlist our current members in the counties we serve to help with outreach to fellow small business owners. We mostly serve English speaking populations, however we have a full time staffer that is fluent in Spanish and has the capacity to utilize translation and interpretation services.

Our top three impact goals for our work include increasing access to capital for Black entrepreneurs, increased business development for Black entrepreneurs, and policy advocacy specifically related to eliminating structural and systemic racism.

Access to capital is not a new issue and we recognize many of our partners are also committed to this issue. However, this is one of our goals that we have asked our members and our community to measure us on. If the work we are doing is not putting more capital into the hands of our members, then we should not exist. We measure every dollar that we help get into the hands of Black businesses. We anticipate being able to generate more than $25M in direct funding to Black entrepreneurs in the next five years. 

Business development is also a critical need for the populations we serve. It is our aim to equip our businesses with the knowledge and assistance to ensure those businesses grow and thrive for generations. We also are keenly aware that the racial equity gap that exists in our State (and in our country) is not by accident. Policies over centuries and decades have intentionally excluded communities of color - and especially Black women. It is our aim to work with policy and decision makers to help advocate and create policies that will close the wealth gap and ensure equity for all.

Charity is a Detroit native and attorney by trade, who brings more than a decade of public service with expertise in law, policy and government. Kai, a native of Brooklyn, NY, is a dynamic, entrepreneurial leader with two decades of leadership experience across several disciplines and industries: manufacturing, education, banking and military, non-profit and government. The experiences of these two leaders combined make the Metro Detroit Black Business Alliance well positioned to serve the needs of Black business in the region while advocating for their success. Both are trusted and well respected with the region as two individuals that are able to craft creative solutions to complex issues, build coalition from existing members of the ecosystem and execute with a high level of excellence. Additionally, they both have the cultural capital to connect with Black entrepreneurs at all levels and develop trusting relationships as true resources and partners. Possessing the ability to listen to issues facing their members and crafting solutions has become a calling card of the organization and has helped to build the ranks of their membership. 

We are applying to the Truist Foundation Inspire Awards because we truly believe we have developed a local solution that has major potential to be scaled across communities of color across the country. We have been able to get the attention of CDFI's and some banks in Metro Detroit, but we believe that a partnership with the Foundation and MIT Solve could help forge relationships with National funders and grant makers to support similar organizations who can adopt our solution to truly help move the needle on closing the racial wealth gap. Considering the economic implications of closing the sizable wealth gap in this country, its seems like a no-brainer that our solution be leveraged by other business serving organizations across the US in communities that have experienced the biggest hurdles to accessing capital. Proving the concept in one of the lowest income major cities in America is proof that this solution can be scaled providing organizations are equipped with the resources and are supported by the banking/CDFI community. As a bank itself, we believe Truist can be an industry leader in helping to scale our solution.  

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While we feel we've implemented and proven with great success thus far a solution that helps accomplish our mission to help close the racial wealth gap, we still require strategic partnerships to continue to improve. We seek partners in spaces that help with data management, metrics and technology to help with the ease of implementation. Considering the intimate level of hand holding and relationship building to help instill trust in all stakeholders, it is imperative that we have better ways to manage our data and track our performance, which can be aided with the right technology. 

Additionally, we continue to seek out new funding partners that are willing to share their underwriting guidelines and partner with business serving organizations who are trusted in their respective communities to better connect with entrepreneurs of color who have been traditionally excluded from accessing critical capital. 

Lastly, we need the national platform to amplify this work and seek out similarly mission based organizations seeking real change in this country, primarily how to close this racial wealth gap and help our country realize the positive economic impact that is inevitable to follow. 

We are seeking partnerships with all funders to include banks, CDFI's, credit unions and grant makers across the country. We also are looking for philanthropic and corporate organizations that believe in our mission and would like to support the work that we do everyday. Lastly, we are seeking out other organizations in communities of color that are looking for solutions to help close the racial wealth gap through the lens of entrepreneurship. We feel confident that we have a solution that can help achieve that goal.