Facebook’s new black business funding program

Facebook’s new black business funding program

To join in the support of black businesses, social media giant, Facebook started a new funding program for black businesses in the United States with up to 50 employees. The new funding program officially kicked off on Wednesday.

Facebook announced in June that it has committed $100 million in grants this year to fund as many black-owned businesses as possible. The company is dedicating $40 million from the $100 million grant program to small businesses. Eligible businesses can receive up to $4,000 in grants, including $1,500 in optional advertising to be used on Facebook’s platform and $2,500 in cash.

To qualify for the grant, businesses must be majority Black-owned, legally registered in the United States or Washington, D.C. The businesses must also have between 1 and 50 employees, and have COVID-19 related challenges.

“The past few weeks have compelled us to confront reality of violence and injustice which members of the Black community face on a daily basis” said Sheryl Sandberg, chief operating officer at Facebook. “We have shared words of support for our friends, colleagues and communities. We need to take action as well.”

The application portal which opened on Wednesday will run through August 31, 6PM Pacific Time. Once all applications have been duly processed, the funds will be granted “as quickly as possible” to those approved. Facebook is also in partnership with Accenture to run the program. It’s other partner, Association for Enterprise Opportunity (AEO) will offer strategic advisory services.

“The last few months more people have witnessed and processed the disparity and racial injustice that Black people in America have been facing every day,” said Maxine Williams, chief diversity officer at Facebook. “I am proud of the work we are doing at Facebook to help address these issues, and to support Black-led small businesses at the heart of our communities and local economies.”

According to Facebook the program can help Black-owned businesses keep their workforce going strong, assist with rent and operational costs, reach more customers, and support the black community.

Many black-owned businesses are small businesses that can barely survive the impact of the coronavirus pandemic. 41% of the 1.1 million small Black businesses on Main Street closed down completely between February and April. The number is twice the rate of majority-owned businesses on Main Street.

A contributing factor to why many Black-owned businesses are suffering is access to financing, especially bank credit. Despite the Paycheck Protection Program loan relief that was open to all businesses, minority-owned businesses still had insufficient financing. “We realize critical support for Black entrepreneurs is needed now,” Williams said. “Helping these businesses stay alive and thrive is a way to promote economic justice and equality.”