NEW YORK, Feb. 7, 2023 /PRNewswire/ — The Local Initiatives Support Corporation (LISC) and Uber Eats [NYSE:UBER] are teaming up to launch a new investment program that will provide growth capital to Black restaurant owners and help break down some of the systemic financial barriers that often limit their opportunities.
The Black Restaurant Fund, announced at Uber and Eat Okra’s Black Business Resource Launch Party in Atlanta, will provide financing with a unique twist: unlike traditional loan products, the investments do not have fixed repayment terms. Instead, they are patient, flexible investments that only require repayment after owners achieve targeted revenue growth.
“Black-owned restaurants have historically been locked out of economic opportunity, which limits their ability to grow and thrive,” said Julia Paige, Uber’s director of social impact. “Uber and LISC created the Black Restaurant Fund to help close the resource gap by connecting Black food entrepreneurs to flexible capital to fuel growth and expansion while seeding wealth creation in Black communities.”
According to the National Restaurant Association, the restaurant industry has a higher rate of minority business ownership than the overall private sector in every state. But, at the same time, minority-owned businesses are more likely to have been denied credit, less likely to receive the full credit amount requested, and more likely to be discouraged from applying for credit, according to the U.S. Small Business Administration.
As a result, they tend to grow more slowly, generate lower profits, hire fewer employees, and create less wealth than otherwise might be the case.
The Black Restaurant Fund, which will be administered by LISC, directly addresses this capital gap by focusing on restaurants in economically disadvantaged communities that have employees, are partners of Uber Eats, and generate revenues from $250,000 to $3 million—meaning they are in a position to effectively deploy growth capital. LISC and Uber expect the initiative will help fuel 35 businesses over the next three years.
“This program is making an investment in a healthy, equitable future for Black restaurant owners and their employees as well as the communities where they operate,” said George Ashton, managing director of LISC Strategic Investments, which is overseeing the initiative.
“We take a different approach to underwriting than many investors do because we can look beyond traditional metrics to consider the real-world potential of these enterprises,” he explained. “It means we can build collaborations and investment products that support their plans for sustainable growth—like this new program with Uber—while at the same time helping owners build a financial track record that can help open doors to conventional investors in the future.”
Uber has been a valuable LISC partner in recent years, collaborating on programs that provided vital financial and technical assistance to more than 1,000 restaurants during the pandemic—mostly owned by entrepreneurs of color. Uber also worked with LISC to advance health aims in underserved communities, ensuring residents had better access to accurate medical information and vaccines.
For more information on the Black Restaurant Fund or to request a conversation about your restaurant, visit https://www.liscstrategicinvestments.org/uber-black-restaurant-fund.
LISC is one of the country’s largest community development organizations, helping forge vibrant, resilient communities across America. We work with residents and partners to close systemic gaps in health, wealth and opportunity and advance racial equity so that people and places can thrive. Since our founding in 1979, LISC has invested $26.7 billion to create more than 463,000 affordable homes and apartments, develop 78.5 million square feet of retail, community and educational space and help tens of thousands of people find employment and improve their finances. For more, visit www.lisc.org.
About Uber Eats
Uber Eats is an on-demand app and website that helps bring millions of people around the world the things they want, at the tap of a button. We partner with over 870,000 restaurants and merchants in more than 11,000 cities across six continents. From specialty local favorites to national brand names, groceries to household essentials and more, Uber Eats has what you want when you want it.
SOURCE Local Initiatives Support Corporation (LISC)
Originally published at https://www.prnewswire.com/news-releases/lisc-and-uber-eats-announce-black-restaurant-fund-to-expand-access-to-growth-capital-fuel-underserved-businesses-and-communities-301740949.html
Images courtesy of https://pixabay.com