Oakland community leaders Elisse Douglass and Trevor Parham launched the Oakland Black Business Fund in June, while the country was grappling with the systemic racial inequities that divide the nation. The goal of OBBF is to address these issues by raising capital and then allocating it to Black-owned businesses and Black entrepreneurs in the community. That idea earned the initiative over $150,000 in seed funding. Now, its work is ready to begin.
On Tuesday, OBBF officially launched its investment platform for Black-owned businesses. In addition to capital, this investment platform will provide technical assistance and growth strategy to these businesses. The group has partnered with Alliance for Community Development, Clorox and Okta to provide these resources.
OBBF is taking a two-pronged approach to address needs at both the local and national level. It’s allotted $10 million in capital to help Bay Area businesses affected by COVID-19. This $10 million will support 500 Black-owned businesses in Oakland with relief funds and technical assistance grants. The initiative also plans to help these businesses prepare for further capital investments in the future and acquire real estate.
“We’re especially focused on funding brick-and-mortar businesses, which anchor the Black community culturally and economically and establish a sense of place for Black communities,” Douglass said in a statement. “By stabilizing these businesses and their underlying real estate, we are taking a critical step toward creating a new economic trajectory for the Black community.”
Both Douglass and Parham have experience in the private equity, impact investment and real estate worlds, which they will use to help lead this initiative.
Meanwhile, OBBF is initiating a national effort that aims to raise $1 billion by the end of 2022. This fund will include money for real estate investments for Black-owned businesses and venture investments for Black entrepreneurs. OBBF cites data that says big banks approve only 29 percent of loans for Black business owners, while approving 60 percent of loans for white business owners. At the same time, less than 1 percent of all venture capital goes to Black founders.
“The disproportionate lack of access to capital is just the tip of the iceberg,” Parham said in a statement. “When you examine the underlying history of economic injustice, rife with barriers to real estate, healthcare, education and employment, you realize that it undermines our growth as a society. This is an opportunity for our country to address a social problem with an economic solution.”
Black-owned businesses in Oakland can apply for relief funds now on the OBBF website. Meanwhile, anyone can donate to these businesses through the website. The initiative hopes to hit its next milestone of $1 million in funding by the end of 2020.
