Los Angeles was disproportionately impacted by COVID-19 with unemployment rising to 6.4 percent compared to the 4.4 percent US average.
Small businesses have taken the greatest hit with 50 percent of small and independent businesses surveyed nationally have insufficient cash reserves to weather more than two months under current conditions. Nonprofits face increased demand yet declining revenues to service communities and continue their missions.
PPP loans favored larger and medium-sized businesses with established banking relationships. Technical and cultural barriers inhibited Small Business Owners from PPP funding.
To provide quick and effective assistance to advance businesses and nonprofits when they and the entire LA region need it most thru forming a targeted COVID recovery fund by bringing aligned and complementary capabilities together.
The LA COVID Fund is a public-private partnership that pools various types of debt and grant capital to provide flexible, low-interest capital to small businesses, microentrepreneurs, and nonprofits, in the LA County region reeling from the economic impact of COVID-19. These loans, and the technical assistance that accompanies them, will provide organizations with the support they need to reopen and navigate a new economic reality.
LISC Strategic Investments and LISC LA will manage the Special Purpose Vehicle (SPV), which will enable partner CDFIs to reach businesses most in need.
Fund Size: $100 Million
Products: Low-interest rate loans, grants & technical assistance
Target Recipients: Small Businesses, Micro-entrepreneurs, Nonprofits
Location: Equitable dispersion in the City of LA & the LA County Region
Impact Priorities: Reach organizations unable to access Federal relief programs, specifically immigrant or minority-owned businesses and nonprofits that serve the community