Disadvantaged Businesses Awarded $2 Million
SALISBURY, MD -- Maryland’s small and minority businesses located in distressed communities have gotten another boost thanks to a $2 million state award to Community Development Ventures (CDV), a Baltimore-based venture capital fund that specifically targets disadvantaged businesses that need patient capital to expand, grow and survive.
GENERAL ASSEMBLY APPROVES FUNDING
The Maryland General Assembly approved the $2 million appropriation during its last session. The funding will be used to provide patient capital to small and minority businesses that need money to hire employees, buy equipment, and sustain their cash flow necessary for daily business operation. “The operative word here is patient capital,” explains Anthony Williams, Vice President and Loan Officer of CDV, a 501(C) 3 non-profit organization located in an Empowerment Zone in downtown Baltimore that will be administering the $2 million funding. “Small and minority businesses interested in funding will now be able to get their sea legs under them through CDV funding. They have up to a year from approval of funding before they begin repayment,” William states.
“Patient capital is especially critical for today’s small and minority business owner, ” adds Stanley Tucker, President of Meridian Management Group, a privatized management team that manages CDV and other business financing programs. “ National and statewide research show that without patient capital, which gives businesses an adequate grace period for loan repayments, small and minority businesses fail at three times the rate. Through CDV, we not only give them a year to repay the loan, but also the training and technical assistance they need for business survival.” CDV SIGNS AGREEMENT WITH MARYLAND SBDC NETWORK
To strengthen its arsenal, CDV has signed an agreement with the Maryland Small Business Development Center Network, which comprises of 22 offices located throughout the state, to help in identifying businesses that need patient capital. “Our agreement with CDV will put small and minority businesses front and center with an organization that can assist them financially,” states Renee Sprow, State Director of the Maryland SBDC Network.
Divided into five regions–the Central region, which covers Baltimore City, Anne Arundel, Baltimore, Carroll, Harford, and Howard counties; the Eastern region, which covers Caroline, Cecil, Dorchester, Kent, Queen Anne’s, Somerset, Talbot, Wicomico, and Worcester counties; the Southern region, which covers Calvert, Charles and St. Mary’s counties; the Western region, which covers Allegany, Frederick, Garrett, and Washington counties; and the Capital region, which covers Prince George’s and Montgomery counties – Maryland SBDC Network offices will provide training, counseling and technical assistance to business owners, while CDV will provide the patient capital. WHO QUALIFIES FOR FUNDING
To qualify for CDV funding, a business must be located within a stressed urban community or targeted county within the State of Maryland, employ a significant portion (60 percent) of its workforce from these areas, be managed full time by the owner, and have a viable and profitable business plan. Businesses can receive between $100,000 and $500,000 in funding. JOBS CREATED
Since 1997, CDV has provided $3.84 million to 11 companies, retaining 70 jobs and creating another 127 positions. It has committed to loans for another $1.2 million to help retain 37 jobs and create 57 new positions. VALUE PACKAGE OF FINANCING
Small and minority businesses that may not qualify for funding through CDV will have another option for financing: the Maryland Small Business Development Financing Authority (MSBDFA). “We offer a value package of financing through an eclectic mix of fund programs so that no business owner is turned away,” explains Stan Tucker, who has been managing the MSBDFA program for close to 20 years.
Other financing available for small and minority business include the Maryland Competitive Advantage Finance Fund (MCAFF), which provides financial assistance for the development and expansion of small businesses within the State. Companies that have been unable to obtain financing on reasonable terms from traditional sources are eligible to apply for assistance.
For more information about CDV, call (410) 333-2550. Information can also be obtained from the Maryland SBDC Network Eastern Region at 1-800-999-7232; the Maryland SBDC Network Western Region at 1-800-757-7232; the Maryland SBDC Network Central Region at 1-877-421-0830; the Maryland SBDC Network Capital Region at 1-877-787-7232; and the Maryland SBDC Network Southern Region at 1-800-762-7232.