In his latest podcast, retired Harvard Business Professor Steve Rogers encourages black business owners to apply for funds through the SBA’s Paycheck Protection Program, designed by the federal government to make forgivable loans available to small companies impacted by the COVID-19 pandemic to keep workers on payrolls.
As Rogers shares with listeners, that money is still available and entrepreneurs should aggressively pursue that money. The first tranche of $350 billion funding initiated on April 3, he maintains, went to1.6 million businesses—many of which were large companies that met the requirement of having 500 employees or less. In the second tranche of capital—an additional $320 billion—in which firms submitted applications on April 27, some $30 billion was “carved out for financial institutions that are friendly to black business owners” that included 22 black-owned banks that have assets of less than $50 billion and community development financial institutions, or CDFIs, which have assets of $10 billion or under.
Rogers argues that this financing is “the best loans ever offered to black entrepreneurs”—77% of whom finance their businesses with their own money versus roughly 30% for white counterparts. Since black businesses employ about 3 million people—a majority of then African American workers—he says it is critical for these firms to participate. He said in a recent presentation to the Harvard Business School African American Alumni Association: “My concern is that we are not applying out of fear, myths, intimidation or misinformation. We need that money!”
In the following podcast, hosted by his daughter and fintech executive Ariel, Rogers makes the case that black firms should pursue that financing today or lose their best opportunity to weather the current crisis.
In addition to the PPP program, Rogers shares a number of public and private financing programs available to minority firms found on the chart below: