National program connects growing inner city companies to $703 million in capital
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BOSTON, Nov. 9, 2012 /PRNewswire-USNewswire/ -- The Initiative for a Competitive Inner City and Bank of America announced today the results of an impact analysis of Inner City Capital Connections (ICCC), a national program that identifies inner city businesses in need of growth capital and matches them with private equity and debt providers. The report reveals that participating companies have raised $703 million in growth capital -- $171 million in equity financing and $532 million in debt. This is a stunning success story, considering that 71 percent of inner city businesses have on average only a quarter of the capital needed to compete in their industries. In addition, ICCC companies have experienced revenue growth at an average CAGR of 46% and created more than 5,600 jobs in their communities.
"There is a significant lack of capital availability in America's inner cities," stated Mary Kay Leonard, ICIC President and CEO. "For many urban entrepreneurs facing capital gaps for their businesses, ICCC helps open the door to a network of financial options that they had limited or no access to previously."
ICCC, supported by national partners Bank of America, the U.S. Small Business Administration and FORTUNE, educates inner city entrepreneurs on how to access capital and matches them with capital providers. To do this, the program offers selected companies web-based training workshops, coaches to help perfect company pitches, a day-long information session on equity and other forms of growth financing, and an innovative one-day event that directly connects them with investors to make pitches and discuss potential opportunities.
This year's ICCC training programs were hosted in Detroit on October 24 and in Chicago on October 29. The Detroit training day was supported by John Hancock Financial, Quicken Loans, Ally Bank, Detroit Economic Growth Corporation, Detroit Regional Chambers, DTE Energy Foundation, Fifth Third Bank, and the Michigan Economic Development Corporation. Supporters for the Chicago day session included: the University of Chicago Booth School of Business, Cook County, BMO Harris Bank, Citi and Cambium LLC.
The program is free to inner city businesses, and 178 companies from across the country have been selected to participate in this year's program. To qualify, a business must be located in the inner city (defined as an area of concentrated economic distress) or have a disproportionate percentage of its employees residing in such an area. In addition, a company must have $2 million in revenue. The companies selected for the program represent numerous industries including technology, food and beverage, consumer goods, business and professional services, and manufacturing.
"ICCC demonstrates that growing inner companies, if given the access to capital, can generate the jobs and wealth that are crucial to the transformation of our urban communities," explained Edward Powers, Managing Director of Bank of America BAML Capital Access Fund. "We are proud to help these growing businesses connect with a vast network of capital providers."
The 2012 ICCC Match Day with potential investors is being held on November 9, 2012 at the headquarters of FORTUNE.
Facts about ICCC:
- 375 inner city businesses have participated in the program
- 150 investors, representing private equity, venture capital, angel networks, mezzanine financing and debt, have participated
- $703 million in capital raised – $171 million in equity and $532 million in debt
- 46 percent annual growth rate in revenue reported by ICCC companies
- 5,694 jobs generated by ICCC businesses since 2005 (an average of 15 jobs per firm)
- 78 percent of ICCC firms are minority-owned and 33 percent are woman-owned
About ICIC: The Initiative for a Competitive Inner City is a nonprofit research and strategy organization and the leading authority on U.S. inner city economies and the businesses that thrive there. Founded in 1994 by Harvard Business School Professor Michael Porter, ICIC expands inner city economies by providing businesses, governments and investors with the most comprehensive and actionable information in the field about urban market opportunities. ICIC's unique knowledge and expertise about inner city success factors and thriving companies is developed from specialized urban networks and path-breaking research. www.icic.org
About Bank of America: Bank of America is one of the world's largest financial institutions, serving individual consumers, small- and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 55 million consumer and small business relationships with approximately 5,500 banking centers and approximately 16,300 ATMs and award-winning online banking with 30 million active online banking users. Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to more than 3 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in more than 40 countries. Bank of America Corporation stock (NYSE: BAC) is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange. For more Bank of America news, visit the Bank of America newsroom.
FORTUNE is a global leader in business journalism with a domestic print and tablet circulation of over 845,000 and a global readership of nearly 5 million. The brand is known for major editorial franchises such as the FORTUNE 500 and the FORTUNE 100 Best Companies to Work For. FORTUNE Live Media extends the brand's mission into live events, hosting a wide range of annual conferences, including FORTUNE's Most Powerful Women and the FORTUNE Global Forum. FORTUNE publishes English-language editions in Europe and Asia, and local-language editions in United Arab Emirates, Kuwait, China, Turkey, South Korea, Indonesia and India. CNNMoney.com, which draws more than 14.6 million readers a month, is the online home of FORTUNE.com.
SOURCE Initiative for a Competitive Inner City