Childcare has been one of the main struggles our communities have seen throughout this pandemic – from daycare owners struggling to stay open, to daycare workers striving to get the pay and benefits they deserve, to working parents scrambling to afford adequate care with no help from the Federal government. La Plazita preschool in Oakland is a true Spanish immersion preschool where kids learn or retain Spanish, while fully preparing for kindergarten. In the years before COVID-19, La Plazita’s first location quickly became successful, and when they expanded to a second location with a more direct community focus in Fruitvale, owner Krystell Guzman was eager for guidance. That’s when Pacific Community Ventures stepped in. She received advice through our pro bono Business Advising program and eventually opened two more locations. She now employs 38 people and, in the spirit of our motto “Good Jobs, Good Business”, Krystell offers healthcare and retirement benefits to all of her employees.
There are hundreds of stories like Krystell’s, and while banks often say “no”, at PCV, we always try to come from a place of “yes”. Centering Black, Indigenous, Latinx, and AAPI entrepreneurs are integral to PCV’s mission of creating a just economy and good jobs with dignity for all working people.
People of color start more businesses each year than anyone else. In 2021 communities of color saw the largest surge in new businesses in decades. Black and Latinx women especially, have become the new face of entrepreneurship in the US. Women of color account for 89% of the new businesses opened every day, but almost 75% of women of color say their most common obstacle to growth is a lack of capital. In 2021 only 13% of Black business owners and 20% of Latinx business owners got the loans they applied for, and only 1% of venture capital dollars were invested in Black founders. We cannot build racial equity by being colorblind any longer, particularly as we prepare this country to transform into a majority-minority country, as projected by 2044.
PCV is committed to making sure our entrepreneurs who have historically been left out of the traditional financial system gain access to the capital and resources they need to meet their ambition. PCV was one of America’s first impact investors – and CDFIs like us were created out of the Civil Rights Movement with the purpose of getting capital to low-income and communities of color. With so many Black, Indigenous and POC communities still struggling with injustices stemming from the past, we are dedicated to decolonizing our lending capital, democratizing access to capital and advising programs, and being restorative in the underestimated communities we serve—towards an economy rooted in economic, racial, and gender justice..
In 2021 PCV invested capital and advice in a record 1,681 businesses!
We funded $10,000,000 in restorative capital loans across California, doubling our capital deployment from the previous year while advancing key impact metrics:
- 90% of our dollars deployed to entrepreneurs or color and/or women
- 86% of our dollars invested in economically distressed communities
- 46% of our capital was invested in women-identifying entrepreneurs
- 78% of our capital was invested in people of color in California (up from 76% last year)
- We’ve expanded our reach! PCV has supported small businesses in 37 California counties – and we’re continuing to add more every month.
Our restorative capital client companies are also growing – and advancing the quality of the jobs they offer:
- 48% of our investees said they were profitable in 2021 (up from 36% in 2020 – the first year of the pandemic)
- Our investees had an average of 7 employees in 2021 (up from an average of 4.6 in 2020)
- There was 27% year-over-year median revenue growth at our companies
- Average wages at PCV investees were $26/hr for full-time and $23/hr for part-time employees (compared to average wages of $24.60 for full-time wages in similarly sized small businesses nationally)
- 52% of investees report that their full-time workers are eligible for health benefits, 21% provide retirement benefits, and 54% provide paid time off
- 60% of our investees provide workers with schedules at least two weeks in advance
Across the country, we reached 1,500 small business entrepreneurs through our Business Advising platform (doubling our advising portfolio from 2019), in partnership with 22 CDFIs and community partners in our Small Business Support Circle:
- 88% of the small business owners we worked with were women or people of color
- PCV business advisors volunteered over 14,000 hours – that’s $2,730,000 worth of free advice and coaching (according to Taproot’s industry standard of $195 average hourly value of pro bono service.)
With our new strategy, PCV is embedding these values even more deeply into the design and delivery of all our products and services. We are fully embracing our founding principles of impact-first investing to DECOLONIZE, DEMOCRATIZE, and RESTORE access to fair and affordable capital and mentorship for the communities we serve.
Decolonizing capital works – and this is how we start. By dismantling the rules and constructs long inherited in the financial industry that keep too many out, and design them by, with, and for the communities we serve. As PCV prepares to celebrate our 25th anniversary next year, we are both going back to our roots as one of the U.S.’s first impact investors, as well as the Civil Rights foundations of our CDFI industry, to decolonize, democratize, and be restorative with the people and places we serve. Join us.
President & CEO, Pacific Community Ventures