Pacific Community Ventures’ work has never been more crucial to the communities we serve. The coronavirus pandemic wiped out 22 million jobs — 10 years of job growth — in the first four weeks, with an additional 37 million jobs vulnerable to layoffs and tens of millions of small businesses in danger of closing. The pace of this economic collapse is so staggering that the Great Depression is the only comparison. The most vulnerable and underserved people and places — particularly lower-income workers and communities of color — yet again find their financial and physical health at risk. We must all do more to stand with the black community, and ally our assets in solidarity — now more than ever.
Times of crisis force us to dig deep in so many ways, and test us in new ways. Although our office doors are closed as we shelter in place, PCV very much remains open for business to help our small business clients through this challenging time as best we can. We are adopting a strategy of providing immediate relief, shaping an inclusive recovery for underserved entrepreneurs, and working toward longer-term regrowth with a good jobs mandate. For immediate relief, our patient lending capital remains available, as well as our pro bono BusinessAdvising.org platform — where business owners can access expert advice for financial management, HR, marketing, and strategy to get through this time. We are also working in partnership with our fellow community investors in California and beyond to meet the needs small businesses will have as we work to shape an inclusive recovery.
CDFIs like PCV are responding to borrowers in crisis in communities from coast to coast. We can’t do it alone. We’ve written an open letter to foundations, impact investors, and banks asking for their increased support to our industry. We’ve also joined a letter from the Aspen Institute calling on the Federal Reserve and Treasury to backstop and buy CDFI loans, enabling us to help business owners suspend operations without destroying the owners’ credit or losing their existing assets.
Throughout 2019, unemployment was at a record low and job growth had been steady for 10 years. But a decade of growth built on bad jobs and ignoring those who fall out of the job market entirely has had implications for our whole country. While this crisis has created enormous challenges, it also represents a unique opportunity to change a system where working people deemed “essential” are earning poverty-level wages and live without paid leave or health benefits for themselves or their families. World War II catalyzed the formation of the United Nations and World Health Organization, and the Great Depression led to the creation of the New Deal, which strengthened the social safety net. The 2008 financial crisis destroyed 8.7 million jobs and 170,000 small businesses were never able to bounce back — but it also gave birth to a more conscious capitalism and the new industry of impact investing. That industry has grown to over $500 billion in the last 10 years, and is growing exponentially each year as millennials begin to take the reins of family assets from baby boomers.
The speed at which this pandemic has affected small businesses, which employ almost 50% of Americans, shows us how fragile our economy truly is. More and more Americans each year want a capitalism based on fairness, sustainability, and equity. Right now, people are painfully aware of the importance of small businesses to the health and vibrancy of our communities, the vulnerability of so many workers, and the need to better prepare people for the future of work. Our hope is to collaborate with key stakeholders and system changemakers to seize this moment to further strengthen the safety net — and improving job quality is crucial to this effort, especially as we also prepare people for the future of work. As many of you know, we have been working hard to deploy our Good Jobs, Good Business toolkit over the past year, to help small businesses prioritize employee health and well-being in ways that also improve their sales and boost their bottom lines.
The opportunity to build back better provides a new opportunity for the field of impact investing to step up its game, for business leaders to put their stakeholders and the environment first, and for governments to improve social safety nets, better regulate capital markets, to reduce the vulnerability of so many to boom and bust cycles.
Pacific Community Ventures’ 2019 Impact Report details how our programs can empower small business owners, working people, and community-focused investors across the country through a good jobs agenda. We help small business owners grow and create good jobs through our “Good Jobs, Good Business” model that combines affordable loans with pro-bono advising, tools and incentives to create quality jobs, our national BusinessAdvising.org mentoring platform, and social impact evaluation and field-building research. As we rapidly respond to support small businesses through this crisis, we remain hopeful that the potential for positive impact we saw in 2019 is a sign of more entrepreneurs and workers starting to prioritize good jobs — something we will all need to advocate for now more than ever. We look forward to working with lenders, foundations, impact investors, and supporters like you to continue to serve small business owners and working people now, and into the inclusive recovery and rebuilding ahead.
This report highlights our progress before the onset of the COVID-19 pandemic and shows how our model can serve as a blueprint for an inclusive recovery. We hope you’ll join us on this journey.
President & CEO, Pacific Community Ventures
Our Impact In 2019: Investing in Small Business
- 770 businesses across 50 states received access to capital and mentorship
- 68% of supported companies grew their revenues
- 12% year-over-year median revenue growth at supported companies
- 11% job growth at our companies surpassing national and state rates (1.2%)
- 4,192 jobs created and retained at the businesses we served
- PCV business advisors volunteered 9,774 hours – that’s $1,466,067 worth of free advice and coaching (according to the industry standard of $195 average hourly value of pro bono service.)
Our Impact In 2019: Investing in Good Jobs
- Average wages at supported small businesses were $22/hour (full-time) and $18/hour (part-time)
- $145,768,836 in wages paid to working people
- 52% of full-time workers at supported businesses are eligible for health benefits, 33% are eligible for retirement benefits, and 65% have paid time off
- 61% of businesses provide workers with schedules at least two weeks in advance
Our Impact In 2019: Investing in Communities
- $33.6 billion in investment capital evaluated across asset classes
- Over $886 Million deployed or managed using our customized Impact Measurement and Management frameworks
Our Impact In 2019: Investing in Racial and Social Equity
- 80% of the businesses we funded were located in, or hiring from, low-income communities
- 80% of the small business owners we work with are women or people of color
- 59% are women
- 56% are people of color
- 76% of workers at supported businesses are people of color