NewsPhilanthropic Fund Has Raised Over $2M For Entrepreneurs

Philanthropic Fund Has Raised Over $2M For Entrepreneurs

Black entrepreneur and seasoned philanthropist James Wahls, founder and managing director of the Revolve Fund,  is convinced recoverable grants are now a viable capital option for Black businesses.

Wahls says recoverable grants can offer Black entrepreneurs prompt and adjustable funding to be used for several purposes. That could include starting a new venture, expanding an existing business, and testing new products. Recoverable grants have been a financing option for decades.
However, what perhaps makes the grants timely now is access to capital remains a large obstacle for many Black businesses. A recent report showed that 76% of Black entrepreneurs reported that access to capital was a hurdle. Wahls maintains funders looking to catalyze businesses led by people of color should support recoverable grant strategies, yet they still need to be utilized.

“Entrepreneurs of color experience a host of challenges when attempting to start or scale their businesses,” he says. “It is imperative that the philanthropic sector and traditional investors develop unique tools that address years of exclusion to cater to this demographic. That is what the Revolve Fund attempts to do.”
So, what is a recoverable grant? Wahls defines it as a financial grant to a for-profit or nonprofit entity where all or part of the investment is returned or directed elsewhere. He says the grant is only repaid if certain financial milestones that support the grant’s charitable purposes are achieved. He stressed the grants are not a zero percent loan, a forgivable loan, or other financial product that includes typical loan-related provisions.

Wahls says Revolve Fund receives grants and donations to offer recoverable grants. He added current funders include the Annie E. Casey Foundation, JPMorgan Chase, PNC Bank, the Rockefeller Foundation, and the Open Society Institute- Baltimore.

Wahls connected with BLACK ENTERPRISE and offered some feedback on how the Revolve Fund works.
BE: Please explain what your fund does and how it works?
Wahls: We offer recoverable grants. With a U.S. focus, we work to increase capital access through interest-free recoverable grant capital for businesses, nonprofit organizations, financial intermediaries, and emerging managers. Revolve offers a network of technical assistance partners, public relations professionals, and investors to help catapult the enterprises of grantees.
BE: What is rare about your firm’s recoverable grant process?
Wahls: Each recoverable grant is custom designed based on several factors and includes agreed upon repayment milestones. My goal is to create an atmosphere of trust and to facilitate knowledge transfers for grantees. We offer compassionate capital that helps entrepreneurs of color scale, connect with larger financial investors, and prepare for future growth.
BE: Please tell us what risks are tied to recoverable grants and whether your firm helps grantees overcome them?
Wahls: The risk falls on the Revolve Fund. If grantees don’t meet their financial metrics, they don’t have to return the money. So, that means that we’re out of our investments. But it is a risk that the fund is willing to pay to push small businesses led by Black people and people of color forward. If they do meet the financial metrics, then they repay the fund. That allows us to recycle the funds and invest in new entrepreneurs.
Those interested in applying for recoverable grants can do so here.
RELATED CONTENT:America’s Leading Black Philanthropists 

Source: Black Enterprise

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