SMART Capital: Access
Increasing Access to Capital for All Businesses
Existing firms and potential entrepreneurs require access to capital and a strong network of business services—both are currently inadequate. Successful businesses often must relocate in order to attract capital and resources for growth—removing jobs and economic development from the community that spawned the start-up. Impact investors and local residents interested in targeting specific regions, industries or firms lack effective intermediaries. The value of patronizing locally owned businesses—capturing the multiplier effect—needs support and better marketing.
Goal of SMART Capital: Access
Expand impact investing and new sources of capital for local business and regional industry clusters. Focus investing on sectors that offer a foundation for jobs and economic development that will serve all Californians. Reduce financial risk to the lender, improve credit worthiness of borrowers and strengthen overall business management through financial technical assistance and business mentoring.
Goals for the Year
Progress update - September 1, 2015
Restructure and leverage existing funding sources
Facilitate institutional investing in California businesses by reducing regulatory constraints and expanding incentives.
September 24, 2013 - For the second year, a majority of regions identified access to capital as a top priority. As a result, the Summit Steering Committee chartered an Access to Capital Action Team to build on the work of last year's team to increase investment in local economies and target investments that generate economic as well as social and environmental returns to California communities. This year, the Team is focused on identifying examples of capital intermediaries that can fill gaps in access to capital in regions across California. The team will convene supporters to bolster and replicate these intermediaries to create stronger capital ecosystems in regions across California.
Develop structures that can receive funds from foundations, banks, insurance companies, CalCap and State Loan Guarantee Programs for investments in non-profit Community Development Financial Institutions (CDFIs) and other organizations that serve small/local businesses and targeted industry clusters.
September 14, 2012
- As part of the CalFOR process, roundtable members worked with the California Endowment to transform the "FreshWorks"
structure. CalFOR is working with the Endowment to organize workshops that will lead to establishment of several structures.
Review existing state programs that can be implemented, managed, and monitored at the local level by qualified lenders (such as non-entitlement Community Development Block Grant)
Implement an "Invest Local" strategy within each of California's regions to efficiently match impact investors with local investment opportunities
Develop a California Community Investment Note
Expand government and institutional procurement from locally owned firms
Ensure California law permits 'crowdfunding' through enabling legislation, creating a State Standards Council to develop standards and accountability for crowdfunding platforms; ensuring diverse representation on such a council
Ease targeting of self-directed IRAs into local investing
Ease establishment and utilization of Cooperatives as a business structure
Enhance technical assistance and training to local business mentoring/coach models accessing industry, financial and scalability expertise from statewide and national resources
Create collaborative delivery models based on various local characteristics, capabilities and capacities to leverage local and statewide resources connecting business with needed expertise
Develop an information clearinghouse on economic development, financing tools, capital resources and contacts
August 30, 2012
- A new "Access to Capital"
guidebook was released in August by the California Financial Opportunities Roundtable (CalFOR), a group ofÂ more than 90 experts and activists representingÂ large banks, small financial institutions, wealth advisors, fund managers, the business community, and economic development organizations as well as local, state and federal government agencies. The document offers a one-stop-shop resource for anyone seeking capital in a straightforward, easy-to-use format.Â