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March 22, 2021 Mercy A. Quaye
New Haven Innovation Collaborative Joins Effort with $200,000 Commitment for Technical Assistance from CTNext’s “Innovation Places” Program
New Haven, CT - The Connecticut Community Outreach and Revitalization Program (ConnCORP) today announced a new initiative of its Economic Justice Fund, developed to support Black-owned businesses through COVID-19 recovery and technical assistance. The Economic Justice Fund (EJF) was initially launched in the summer of 2020 with a commitment to give $600,000 to families in the Newhallville and Dixwell neighborhoods for basic needs. This expanded coverage is targeted for established Black-owned businesses that have been in operation for at least 24 months in New Haven. The goal of the fund is to create a cadre of Black businesses that are economically resilient to withstand economic recessions as well as being wealth and wage generators for their owners, employees, and the community at large. ConnCORP will be working with trusted business and community partners to solicit referrals to established Black-owned businesses. After a short application process, the 10 businesses accepted in the first round of grant funding will receive up to $10,000 depending on assessed need. In addition to financial capital, the fund will provide CTNext sponsored technical assistance of up to $15,000 in the form of identified consultants in areas such as marketing, financial/accounting, new product development, legal, web design, and communications and public relations. Businesses will also be able to take part in ConnCORP’s Economic Impact Lab (CCEIL) and participate in program offerings and resources. ConnCAT has committed to raising $1 million in grant funding to support New Haven's community of Black-owned businesses. “This effort is just another example of our commitment to ensure those most severely affected by the pandemic don’t suffer permanent impact to their businesses as well,” offered Anna Blanding, Chief Investment Officer for ConnCORP. “Entrepreneurship has been a key lever for intergenerational wealth creation in our communities, but resilience has always been a major barrier to success. We know at every phase of business development, black businesses have less access to capital than their peers, which constrains long-term growth, the ability to enter new markets, profit, hiring, and overall sustainability. Every ounce of support for them is an investment in the long-term economic success of our communities. What’s impactful about ConnCORP’s approach, as we continue our deep and broad investment in community, is the access to financial capital as well as social capital. It’s the network effect that’s needed to transform our communities.” According to the Federal Reserve Bank’s Small Business Credit Survey, more than 40 percent of Black-owned businesses closed during 2020 due to the COVID-19 pandemic, because they lacked “resilience” or the ability to withstand major economic shocks. This is due to a lack of financial capital, product differentiation (especially online), low margin industries, and lack of social networks. While many programs address the ideation and incubation stages of entrepreneurship, there is a lack of resources for established businesses and even fewer to help established Black businesses. Given the racial wealth gap in America between Black and white households, ConnCORP understands that there are fewer opportunities for Black business owners to lean on a social safety net when experiencing financial or economic troubles. The combination of these two socio-economic factors results in Black businesses being less stable at every stage. “It’s no secret that we’ve been fighting the effects of two pandemics and in a lot of ways, ConnCORP has had to pivot to address the needs of our communities -- The Economic Justice Fund was our answer to this problem,” said Erik Clemons, Executive Chairman of ConnCORP. “Everywhere you look around this city, you can see Black entrepreneurs striving, innovating, and collaborating across sectors to do some transformative work that often supports the very communities in which they live. The least we can do, when investment in our community is our top priority, is to bolster their efforts and serve as a fail-safe in times of extreme widespread economic burden.” As developed, the Economic Justice Fund will initially fill this gap for established businesses, and then may select businesses to benefit from larger forms of capital in the form of loans, revenue sharing, and other equity investments. The New Haven Innovation Collaborative (NHIC) is supporting the effort with a $200,000 CTNext matching grant for tailored technical assistance services for businesses selected to receive funding from the Economic Justice Fund. “By supporting the Economic Justice Fund and ConnCORP’s work with Black entrepreneurs, we can invest in experienced local businesses as they pivot their services and products for post-COVID markets," said Michael Harris, director of the New Haven Innovation Collaborative. "By selecting Black-owned firms to provide that technical assistance, the EJF is building a network of support for growth in the face of unequal access to capital–past and current. Black-owned businesses received only a small portion of Federal COVID-19 assistance and many are now reporting that accessing credit has become increasingly difficult. Together, our economic recovery will be fairer–and stronger–if we can fund the potential in these under-resourced entrepreneurs.” Administered by the Economic Development Corporation of New Haven, the New Haven Innovation Collaborative develops strategy and coordinates funding for the CTNext “Innovation Places” program, established by the CT state legislature in 2016 to catalyze growth in technology and entrepreneurship in Connecticut’s urban centers. For more information, visit conncorp.org.
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ConnCORP seeks to drive economic development in the Dixwell and Newhallville sections of New Haven by investing in local commercial and residential real estate. The objective is to deliver well-planned multi-use real estate investment, which can help stabilize the local economy, provide affordable goods and services, and create local jobs.