Impact Report 2022

A NOTE FROM OUR CEO

Pacific Community Ventures is embarking on a new strategy that grounds us in experimentation and research, and focuses us on decolonizing, democratizing, and restoring our communities.

Childcare — 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 — has in many ways come to define the last two years. 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 it came time to expand to a second location with a more direct community focus in Fruitvale, owner Krystell Guzman was eager for guidance. That is when Pacific Community Ventures came in. She received advice through our Pro Bono Business Advising program and eventually opened two more locations, employing 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.” In November 2021, we launched our Oakland Restorative Loan Fund — $2.5 million in no fee, zero-interest loans for small businesses located in low to moderate income neighborhoods — the first effort under our new strategy to decolonize capital. Krystell applied for an Oakland Restorative Loan Fund loan and received it this January. During a very challenging year, in which many parents opted to keep their children home, La Plazita closed for 2 months, and upon returning, only 5% of their kids came back right away. Krystell told us she intended to use her loan to stabilize her business.

Now that they’ve built back, she’s using the zero-interest loan “to continue growing the schools, maintaining the jobs that we have, and providing better wages to our employees.” As a working mom and former small business entrepreneur myself, I stand with the parents and staff who needed Krystell to succeed in their community for their economic well-being, especially knowing that the lack of affordable childcare led to a great drop of women in the workplace during the pandemic.

We built this zero-interest fund because that’s what small business owners in our community told us they needed over the past year. When we launched it, however, we heard some surprising pushback from other community investors: that this was distorting the market. To them, small business owners like Krystell were “acceptable losses” in an economic downturn, where it is expected that many businesses will fail. We refused to accept this loss, and strive to help entrepreneurs like Krystell preserve as much as possible for the well-being of her business, her workers, and her community.

Our Oakland Restorative Loan Fund and 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, and 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.

PCV was one of America’s first impact investors when we were founded — 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, our new strategy takes PCV’s foundational values into the future.

Two things make impact investing different from traditional investing:

1. Intent — Design your investment to impact the social or environmental problem you’re looking to solve; and

2. Measurement — Make certain your investment accomplishes that goal over time.

With our new strategy, PCV is embedding these 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.

As we combat a constantly changing economy and system, it is crucial that our work be adaptable and rooted in learning, research, and experimentation. This is where our new Good Jobs Innovation Lab comes in. While our Small Business Lending and Advising programs will continue to connect entrepreneurs to accessible expertise and restorative capital, the Good Jobs Innovation Lab will establish a regular process of research and experimentation to ensure that our programs grow with and actively impact our communities’ changing needs, empowering workers alongside business owners and building wealth.

In 2022, as we launch our new strategy, PCV is going deeper into place-based community-led and designed ecosystem approaches across California, starting with our hometown in Oakland. We will also partner more deeply with community organizations and other CDFIs across the nation through our pro bono Business Advising program. Our advising will match the diversity and lived experience of the entrepreneurs and communities we serve, and support both business growth and worker empowerment, towards our goals of helping business owners like Krystell be agents of change in their communities and catalyze racial and community wealth. 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!

In Solidarity,

Bulbul Gupta

President & CEO
Pacific Community Ventures