The funds will go toward community lending institutions (CDFIs), which will in turn support BIPOC-owned businesses beginning in 12 major U.S. metro areas
Starbucks has announced a $100 million investment toward the launch of the Starbucks Community Resilience Fund, intended to support businesses and community development projects in BIPOC neighborhoods in 12 major metropolitan areas including New York, Atlanta, New Orleans, Los Angeles, Seattle, San Francisco, and Washington, D.C. By 2025, Starbucks will have invested $100 million toward racial equity and community-based environmental causes.
“Starbucks has always been a company focused on caring for our partners, creating experiences for our customers and playing a positive role in our communities and throughout society,” Kevin Johnson, Starbucks president and CEO said in a statement. “We are excited to make this investment as it aligns with our mission and values and supports our aspiration to advance equity and opportunity in the communities we serve.”
Here’s how the community investment project will work: Starbucks will partner with Community Development Finance Institutions (CDFIs) that historically support communities of color with less access to capital. From there, CDFIs will use these funds to support small business growth, including businesses and development projects that support environmental change. The long-term goal, Starbucks said, is to support “community inclusivity and resiliency.”
In 2019, Starbucks committed to investing in four Chicago-based CDFIs and this will expand upon that commitment to new lenders in needful communities nationwide. One of Starbucks’ investments in 2019 was Green Era Sustainability, which now has plans to construct a two-acre clean energy campus in Chicago, with an urban farm, green houses, an outdoor fresh produce market, and STEM research center.
“Starbucks investment means we’ve been able to drive more capital to small businesses and nonprofits that are innovating and providing critical services in local communities,” Matthew Roth, president of core business solutions, who leads the CDFI wing for lender and real estate consultant IFF, said in a statement. “The pandemic has highlighted how important CDFIs are in the financial ecosystem, ensuring capital reaches non-profits and small businesses serving low-income communities that are traditionally left out of mainstream finance.”
Starbucks also announced that they will be partnering with the Smithsonian’s National Museum of African American History and Culture in honor of Dr. Martin Luther King Jr. to share educational resources across Starbucks’ digital platforms.
This is part of Starbucks’ renewed commitment to promoting diversity, and inclusion both in and outside of their stores. In October, the company committed to a workforce of at least 30% BIPOC by 2025.
The company will also partner with organizations like the Opportunity Finance Network so local CDFIs in the different cities can provide small businesses access to capital and other resources to help their businesses. “Starbucks is investing in the survival of small business by working with CDFIs in key cities across America. CDFIs deliver affordable credit as well as training on disaster recovery and rebuilding – and that is exactly what small businesses need right now to withstand ongoing economic and climate changes,” said OFN president and CEO, Lisa Mensah, in the statement.
“With partners like Starbucks and CDFIs, these small businesses will have a fighting chance to recover, rebuild, hire workers, and serve their local economy.”