By ONME News
In this episode of News Too Real, producer host Julia Dudley Najieb reviews the crisis for ethnic, small businesses after the pandemic caused a shutdown of the entire economy; 41 percent of Black businesses nationwide have shut down since the beginning of the pandemic until now.
The U.S. is home to more than four million minority-owned companies in the United States, with annual sales totaling close to $700 billion. As the COVID-19 pandemic hit, many small enterprises had to rapidly reshuffle their business models; 200,000 businesses permanently shut down.
How will mom-and-pop Main Street America emerge from this crisis; will small businesses catch the wave of the expected economic boom, or continue to tread water to stay afloat?
Three experts address this problem head-on: Lendistry CEO Everett Sands; historic Washington D.C. business owner, Virginia Ali and Congressman Ro Khanna.
Lendistry, a Southern California lending company founded by CEO Everett Sands in 2014, has been in the national spotlight as a major partner with companies in under-served communities hit hard by the COVID-19 pandemic. Sands started the company, which is based in Brea near Anaheim, with the goal of helping promising small business owners in struggling communities get approved for the funding. His goal is to offer the latest fintech with a quick, online application process.
Sands, a minority-led entity which helped thousands of small businesses secure loans through the Paycheck Protection Program, (PPP) provides an overview of the pandemic's impact on minority-owned small businesses and private-enterprise strategies to aid small business revival.
In regards to PPP loans, Sands discusses how the qualifying measures for businesses has changed 30 to 40 times since the Trump Administration first released these funds to big businesses and corporations; it was obvious that ethnic businesses, micro businesses, entrepreneurs and some small businesses were left out due to the lack of banking relationships required to obtain the PPP loan. He also explains how most ethnic businesses were already struggling with financial issues before the pandemic, but owners are always resilient, finding another business, job or way to survive.
Sands also talks about the American Rescue Bill which had $350 billion that went out to individual states, counties and cities with greater than 200,000 in population; this money is available now, and can help small businesses as a catalyst to get back on one's feet and get open to the public.
"That money in this moment, while we are reopening represents as capital that can be catalytic, where as before the previous capital was to make sure businesses can hold on."
Sands explains how most of the cities and counties have decided such funds will be grant money versus loans, and businesses should apply right away.
"I think it is extremely important that the small business owner, one (1), look at advocacy work to see where the money is going and who it is going out to, two (2), talk to their economic development--their cities, their states, and their counties--to find the program, and then three (3) most importantly, apply."
Virginia Ali is now 86 years-old and she started Ben’s Chili Bowl with her husband Ben when she was only 24. Every August 22nd, Ben’s Chili Bowl celebrates its founding and celebrates DC’s African American history, culture, and character.
Ali, discusses how she kept her 62-year-old historic Washington DC diners afloat amid the pandemic, even as the nation's capital shuttered down. Ben's Chili Bowl has a rich legacy of supporting the community, including donating food to protestors during the seminal 1963 March on Washington where 250,000 people showed up to the City without incident.
"Of course Dr. King was busy with his Civil Rights Movement in the 60s before he died, and he would come to Washington pretty often. He had a satellite office just two blocks from the Chili Bowl. So he would come to Washington particularity when he was planning his March on Washington that took place in 1963. And I remember him coming into the Chili Bowl and sharing his dream with me on occasion."
"I remember him telling me such a profound story when he said that he had met with President Kennedy, and he told President Kennedy that he was going to bring a lot of people to the City to protest the injustices of African Americans. President Kennedy said, 'I don't think it's a good idea--if there is an incident, it would set your movement back. I think you need to be very careful.'"
"Dr, King said, 'There won't be an incident.'"
"And as you can recall, there were 250,000 people here for that March on Washington without a single incident --and that was an amazing accomplishment."
Comparing the riots in the 1960s after the death of the Rev. Martin Luther King, Jr. to street shutdowns due to reconstruction, Ali said this pandemic has been the worst catastrophic event for her business since they opened in the 1960s. She described the complicated paperwork to file for the COVID-19 related loans and grants, as well as the struggle to get international and national customers back to visiting her restaurant location, but she still had hope.
Representative Ro Khanna represents California’s 17th Congressional District. Rep. Khanna sits on the House Committees on Agriculture, Armed Services, and Oversight and Reform. Prior to serving in Congress, Rep. Khanna taught economics at Stanford University, law at Santa Clara University, and American Jurisprudence at SFSU. Rep. Khanna served in President Barack Obama’s administration as Deputy Assistant Secretary at the U.S. Department of Commerce. Rep. Khanna graduated Phi Beta Kappa with a B.A. in Economics from the University of Chicago and received a law degree from Yale University.
Congressman Khanna, a member of the Congressional Small Business Caucus, speaks about the challenges of reopening Main Street America, whether the PPP loan program was sufficient to get small business owners back on their feet, and what's next in the Congressional pipeline for additional support.
"I was a big supporter of the PPP Program; I thought initially it was not targeted correctly. A lot of the people who were getting the money were multi-million dollar companies or people who had relationships with banks. And it was particularly hard to access for disadvantaged communities, Black and Brown communities."
Congressman Khanna did not think it was fair that only those businesses who had relationships with big banks had access to PPP loan opportunities and the like. The next time around, he wants to ensure that small businesses are a part of the infrastructure building process happening right now on Capitol Hill.
"Right now the focus on Capitol Hill is on infrastructure ... I want to make sure that, that money is distributed with small businesses in mind and with racial and gender diversity in mind."
"I think the two lessons of the small business aid were, one, make sure we are not just defaulting to big bank customers, and two, make sure we are looking at the racial and gender distribution of the aid...we have to have prioritization for smaller businesses, people with under 25 employees. It was mind bottling to me that so many businesses with 400 or 500 employees, with $5 to $10 million in revenue--those aren't small businesses; those are medium-sized businesses. When I think of a small business, I think of a local restaurant, I think of a local dry cleaner, I think of a nail salon."