MILWAUKEE – May 5, 2022 – According to the Black Business Owner Spotlight 2021, 56% of Black entrepreneurs said access to capital was a recurring barrier, often limiting their ability to grow their business. To help break down this barrier and further close the racial wealth gap in the United States, Northwestern Mutual today announced a $5 million investment in two black and white-led community development financial institutions (CDFIs). based in Milwaukee. The company will partner with Legacy Redevelopment Corporation (LRC) and the Northwest Side Community Development Corporation (NWSCDC) to increase access to capital for Black and African American businesses, fueling small business growth and economic vitality in the region. Milwaukee community.
“Northwestern Mutual has a tradition of investing in the communities we proudly serve, especially in our hometown of Milwaukee,” said Ray Manista, executive vice president and chief legal officer and chief compliance officer for the company. “Black and African American business owners, for a variety of reasons, have had limited access to traditional capital markets, and this latest investment will deepen our mission to make bold, long-term impact that drives access and growth. ‘equity.”
Northwestern Mutual’s investment is the result of the company’s Sustained Action for Racial Equity (SARE) task force, which launched a $100 million impact fund that directs investments to Black and African American communities. at national scale. The fund focuses on three key opportunities: building physical and social infrastructure, improving access to capital, and creating healthy and sustainable neighborhoods and communities.
The racial wealth gap in the United States is significant, and this inequality is particularly evident among black residents of Milwaukee. Black-owned businesses are being denied loans at twice the rate of their counterparts. Without the ability to access capital, businesses in underserved communities are often unable to secure the resources they need to build capacity and plan for growth.
In Milwaukee, where traditional black-run banks are unavailable, CDFIs aim to fill that void. Northwestern Mutual’s investment will provide existing operating businesses with the financial solutions needed to continue to grow and expand. CDFIs combine financing with business education, one-on-one technical assistance and credit structures to both mitigate investment risk and support business success to enable small businesses to be more ready for the future. bank.
LRC, led by President and CEO Terese Caro, is the only US Treasury-certified CDFI focused on housing and commercial real estate in Milwaukee, providing strategic financial solutions to small businesses and non-profit organizations. non-profit in the city’s underserved markets. The NWSCDC, led by Executive Director Willie Smith, is based on the northwest side of Milwaukee and works with businesses to build stronger neighborhoods, create economic growth and encourage urban environmental improvements. Both CDFIs actively invest in local businesses in manufacturing, commercial and residential real estate, retail, restaurants, adult homes, hospitality, technology and transportation.
“We are thrilled to partner with Northwestern Mutual and provide much-needed loans to local Black and African American-owned businesses,” Caro said. “This partnership will change the trajectory of the LRC and the NWSCDC in terms of what we can do and the communities we can impact.”
Through Northwestern Mutual’s SARE Task Force, the company has invested in Black and African American communities where significant racial disparities exist. He launched the Northwestern Mutual Black Founder Accelerator, a partnership with gener8tor, in 2020 to invest in and support black entrepreneurs to help close the black founder funding gap. Through the Northwestern Mutual Foundation, the company has also donated more than $28 million to underserved neighborhoods of Amani, Metcalfe Park and Muskego Way in Milwaukee to promote safer communities, revitalize housing , increase access to quality education, food programs, youth and family resources, and more. .