(CNN) — The Commerce Department is launching a nearly $100 million grant program to help tens of thousands of female and minority entrepreneurs jump-start and scale their businesses, targeting structural barriers those groups face.
The Capital Readiness Program will provide $93.5 million in grants to business incubators and accelerators to connect underserved entrepreneurs to a pipeline of resources, training and capital to develop their businesses. The program, an initiative of the Commerce Department’s Minority Business Development Agency, represents the single largest investment in the agency’s history.
Commerce Secretary Gina Raimondo told CNN in an interview that she believes the initiative will help create “thousands of jobs and unleash a huge wave of innovation by minority entrepreneurs” by working to break down barriers to capital, know-how and networks.
“I know firsthand from my years in the business that women and minorities just have a harder time raising capital, getting their first customer, getting hooked into important networks,” said Raimondo, a former venture capital executive. “If there’s a Google out there — a young woman or a young person of color who has a great idea and they just can’t access that first $100,000 of seed financing and this gets them going, you can imagine we might be uncovering the next unicorn investment that otherwise wouldn’t have made it.”
Business surveys have found that minority-owned businesses were hit hardest during the pandemic, exacerbating an already unequal playing field.
The grants, which a senior Commerce Department official said will range from $2 million to $3 million each, will fund programs run by companies, nonprofit organizations and universities, providing services ranging from financial literacy and technical assistance to networking, mentorship and child care services.
The grant program will focus on high-growth industries such as health care, climate technologies, asset management and infrastructure. It will also look to help entrepreneurs applying for funds provided by the Treasury Department’s State Small Business Credit Initiative.
The Treasury Department funneled $100 million of American Rescue Plan funds to the Minority Business Development Agency to fund the Capital Readiness Program. A Commerce Department official said the remaining $6.5 million would be used to support the program and provide additional training and resources to grant recipients.
Wally Adeyemo, the deputy Treasury secretary, said in a statement that the program “will help enable entrepreneurs and business owners to obtain the information they need to access funding through small business support programs.”
“When entrepreneurs and small business owners in all communities have a chance to compete and thrive, it increases our country’s entire economic potential and growth,” he said.
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