$5M Wells Fargo grant will provide capital to Black entrepreneurs in St. Louis

Katie ArnoldJP In The News

From the St. Louis Business Journal

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 – Reporter, St. Louis Business Journal

Justine Petersen, which provides capital, loans and other financial services to minority-owned small businesses and entrepreneurs in St. Louis, is getting a $5 million grant from Wells Fargo & Co.

Nationwide, Wells Fargo is donating $400 million it received in Paycheck Protection Program (PPP) processing fees through a program called the Open for Business Fund to aid small businesses hardest hit by the pandemic, especially those that are Black-owned or operated by entrepreneurs of color.

Galen Gondolfi, chief communications officer for Justine Petersen, discussed the organization, the grant, and what it means for St. Louis.

What is Justine Petersen? It is a nonprofit that furthers the legacy of the late Justine Petersen, who more than 30 years ago was a pioneer in community development lending, partnering with banks and other lenders on creating mortgage products in reach for low- and moderate-income families. Robert Boyle, her colleague, founded the organization in her name in 1997.

What does it do? We connect families and individuals to traditional bank lenders for mortgage loans. We do not originate the mortgage loans. We’re a portal of entry. We help people enhance their credit profiles so they are credit worthy. We’re essentially a hybrid of social work, counseling and connecting clients to credit.

In addition, we are one of the largest micro-lenders for the SBA, providing business loans in the range of $50,000 or less. We also have a Community Development Financial Institution (CDFI) fund called Great Rivers Community Capital that will deploy the $5 million grant from Wells Fargo. The fund will not only provide refinancing of higher interest debt at 3%, but also, in some cases, allow for new loan origination for the purpose of pivoting the business to remain more resilient. CDFIs partner with mainstream banks and credit unions to deploy capital. Though we don’t originate mortgage loans, we do originate more than 1,000 small-business loans per year.

How much financial impact have your services had over the 23 years since founding? More than $100 million in assistance for homeowners and entrepreneurs starting and expanding small businesses. We borrow millions of dollars from the SBA, then pay the SBA back. We have more than 50 bank partners, practically every bank in town.

How does the $5 million Wells Fargo grant rank? It is one of the largest grants in the history of our organization.

How many businesses will be helped? The average loan size will be $50,000 to $100,000. We’re not setting a target on the number of loans. It’s more about how we can help businesses with surgical precision.

Separately, Google on Monday announced a new Digital Coaches program, a free service launching later this month that will provide digital skills training and coaching for Black and Latino small businesses in St. Louis.

“St. Louis has a vibrant and growing Black and Latino small-business community,” said Lucy Pinto, Google’s Digital Coach program manager. “The Digital Coaches program will provide business owners in these communities with ongoing workshops and hands-on coaching sessions focused on the techniques and digital tools to reach new customers, thrive online and grow.”