Stepping Up for Small Businesses During COVID-19
By Kristen Scheyder, Senior Program Officer, Citi Foundation
Small businesses are essential service providers to communities, especially in times of need. During the height of the COVID-19 pandemic, small businesses were on the frontlines caring for children, preparing and delivering food, and providing healthcare and other services that enabled larger businesses to continue to operate and communities to survive. As the U.S. continued its economic recovery efforts, the Citi Foundation recognized that entrepreneurs that were able to keep their doors open required high-quality advice on how to navigate the rules of public support programs, adapt to COVID-19 public health restrictions, and develop new plans for financial stability.
In 2021 through its Small Business Technical Assistance (SBTA) initiative, the Citi Foundation provided $25 million in total grant support to 50 nonprofit organizations around the U.S. Each organization received $500,000 in unrestricted funding to support their continued work in providing technical assistance to small businesses owned by people of color that were disproportionately impacted by the unprecedented health, social and economic impacts of the COVID-19 pandemic.
Over the course of the grant period, the organizations collectively provided technical assistance to more than 133,000 small businesses. Amongst the businesses served, 79% were owned by people of color and more than 42% were owned by women. 99% of the businesses had less than 50 employees.
The 50 community organizations provided a wide range of technical assistance programming including strategic and financial planning, legal services, technology solutions, and application assistance directly to small businesses across the country. One example is Lutheran Social Services of New York Family Child Care (LSSNY-FCC), which served 119 minority-owned business owners with capacity building, direct assistance, and technical support to stabilize each business and rebuild from the pandemic. They provided remote learning classes to quarantined children and virtual coaching to providers in implementing a play-based curriculum that was appropriate to children.
Many small businesses also needed help to adapt to the shifting business landscape caused by closures due to the COVID-19 pandemic. One such business was Sweet Delight Cheesecake, a small business owned by Nadia, a Haitian American immigrant who, in 2019, had participated in the Florida International University’s (FIU) StartUP FIU Local incubator and doubled her revenue in just six months. She received loans and opened her first retail space in February 2020, right before the March 2020 lockdown. Determined to see the business succeed, Nadia pivoted her business and grew revenue with deliveries and online sales. In 2021, however, she experienced a decrease in sales and foot traffic. Nadia turned to StartUP FIU Local again to work on marketing; specifically, on incorporating a dynamic digital marketing plan with targeted outreach and blogging. She also began using new technology to manage monthly incentives for new and existing clients and maximized her location by renting space for special events. Due to these efforts, her revenues grew by 34%.
“Nadia’s story is so much like the other small businesses we work with,” says Emily Gresham, Co-Founder of StartUP FIU and Assistant Vice President for Research and Economic Development at FIU, “what’s important here is that support organizations like ours have the ability to quickly adapt to changing needs. Receiving unrestricted support from the Citi Foundation gave us the flexibility to be there to help our local small businesses navigate these uncertain times.”
These are just a few examples of the dedicated community organizations we invested in and the impact they have achieved. The unrestricted funding dispersed through this initiative helped make sure that small businesses received the individualized support they needed to survive and thrive through the pandemic. Nevertheless, small businesses around the country are facing new economic challenges, all while still encountering the lasting economic impacts of COVID-19. So, now isn’t the time to pat ourselves on the back. It is time to continue investing in efforts that support small businesses so that they can continue to recover and rebuild.
At the Citi Foundation, we remain committed to supporting the resilience of small businesses. Through our Community Finance Innovation Fund, we are supporting Community Development Financial Institutions and Minority Depository Institutions to help deliver credit and other asset-building financial services to unbanked and underbanked households and entrepreneurs in low-income communities and communities of color.
*Impact numbers self-reported by grantee organizations
