Wells Fargo's Open for Business Fund: A Lifeline for Small Businesses

Wells Fargo's Open for Business Fund was established during the pandemic with $420 million in Paycheck Protection Program processing fees. This fund provided vital financial and technical assistance to struggling small businesses through grants to over 200 nonprofits, including Community Development Financial Institutions (CDFIs).

The fund helped preserve and create over 461,000 jobs, supporting 336,000 entrepreneurs.

The Ripple Effect of the Open for Business Fund

The Open for Business Fund went beyond providing direct financial aid. It focused on providing flexible capital and technical assistance to small businesses.

The fund enabled organizations to attract over $2.1 billion in public and private funding, resulting in more than $1.4 billion in total loans, grants, and modifications for struggling small businesses.

Wells Fargo's contribution catalyzed significant additional investment, demonstrating the multiplier effect of the Open for Business Fund.

Prioritizing Underserved Communities and Women Entrepreneurs

The initiative prioritized underserved communities, with 53% of beneficiaries being women-owned businesses, a majority of which were owned by women of color.

The program addressed the challenges faced by diverse entrepreneurs and challenged the notion that they are inherently risky investments.

Wells Fargo's commitment to equity and inclusion is evident in their efforts to support women entrepreneurs and businesses in marginalized communities.

Cupcakin' Bake Shop: A Success Story of Wells Fargo's Support

Lila Owens, founder of Cupcakin' Bake Shop, received a $600,000 equity investment from ICA, a CDFI supported by Wells Fargo's Open for Business Fund. This investment enabled Owens to expand her business, opening two new stores and creating 12 jobs.

Cupcakin' Bake Shop now has seven locations, showcasing the positive impact of Wells Fargo's funding on a thriving small business.

Owens' story exemplifies the transformative power of flexible funding and strategic support for women entrepreneurs.

MoFi: A CDFI Leveraging Wells Fargo's Support for Underserved Businesses

MoFi, a CDFI based in Missoula, Montana, has been serving overlooked small businesses in the Rocky Mountain West for over 40 years. Wells Fargo's Open for Business Fund provided MoFi with a $2.1 million grant, enabling them to provide much-needed capital to businesses struggling to recover from the pandemic.

The grant streamlined MoFi's lending process, reducing approval and disbursement time from 100 days to just a few days.

MoFi leveraged the initial $2.1 million grant to deploy a total of $17 million to approximately 250 businesses.

The Importance of CDFIs for Economic Growth and Opportunity

MoFi's president and CEO Heidi DeArment emphasizes the need for greater recognition and funding for CDFIs. She advocates for a federal funding mechanism similar to the Fed window for banks and credit unions, which would provide CDFIs with the resources they need to meet the growing demand for their services.

CDFIs play a vital role in fostering economic growth and opportunity in underserved communities by providing financial assistance and technical support to small businesses.