Twelve years after she opened her faith-based child care facility in east Charlotte, Janice White-McClellan needed more space, more children in the door and a massive building renovation with a $150,000 price tag.
But getting that kind of money for her business, Anointed Future Child Development Center, seemed daunting.
Her “blessing,” she said, came in an announcement from Tory Burch – the billionaire New York fashion mogul whom she credits with making her business expansion dreams come true.
Burch, along with Bank of America, launched Elizabeth Street Capital to help female entrepreneurs easily access capital through business loans. A year later, the program has distributed about $3 million worth of loans to nearly 100 female business owners in select markets across the country.
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In Charlotte, three loans have been granted to women-owned businesses. Organizers, which include Burch’s nonprofit, the Tory Burch Foundation, won’t say how much the loans are worth, citing borrower privacy. They did say, however, that loans disbursed in Charlotte were among the largest in the program.
“We’re focused on reaching women small-business owners with a need,” said Noelle Bell, Bank of America spokeswoman.
White-McClellan, 48, said she was approved for a $257,000 loan and used the money to add a new roof, new rooms, a parking lot, a fence, ramp and playground to her facility. Those fixes transformed the center from a facility that could fit 12 children to one that now can accommodate 40.
“That was my dream,” she said. “They helped me carry out and embark upon it.”
Helping women nationwide
When Burch took center stage in front of 130 businesswomen in Charlotte last July, she was transparent about the struggles female entrepreneurs face when seeking capital.
“Women have a tougher time getting loans,” she said. “It’s just how it is.”
The National Association of Women Business Owners reported there were more than 9.1 million women-owned businesses in the U.S. last year. Yet, the small-business loan approval rate for women-owned companies was still 8 percent lower than for male-owned companies, according to Biz2Credit.com, an online lending marketplace.
Elizabeth Street Capital, named for the location of Burch’s first New York boutique, aims to close that gap. Funding partner Bank of America invested $10 million in the program and partnered with local community development financial institutions to disburse the loans.
In Charlotte, those loans come from Self-Help Credit Union, which granted 16 loans worth $1.3 million to North Carolina businesswomen last year, said David Beck of Self-Help. Businesses that received the money, he said, include four child care businesses, a dance studio, a beachfront hotel, a beauty salon and a costume store in cities across the state, including Durham, High Point, Kinston and Asheville.
By comparison, 23 loans worth $159,000 were distributed in New York; six loans worth $167,000 were given out in Nevada; and a dozen loans totaling $111,000 were disbursed in Pennsylvania, according to institutions in those states.
But the story is different in New Jersey, where administrators say no loans have been distributed. The reason, they say, is because some business owners who applied for the loans changed their minds when they realized they were not prepared to take on the burden of repayments.
“We understand that taking out a loan is a big step for many women small-business owners, which is why we also provide mentoring and networking opportunities,” a Tory Burch Foundation representative said in an email. “Ideally, when the time is right, they’ll come back through the ... initiative.”
Dreams come true
Krystal Stevens, 32, didn’t have any jitters when she applied for an Elizabeth Street Capital loan that would help her buy Salon Zen, a University City-area beauty shop where she worked – and which she later managed – for four years.
She’s confident the salon will repay the $39,000 within three years. The money is another step in making Stevens’ shop “one of the premier salons in Charlotte,” she said.
Over the next few years, she plans to enhance the salon’s services to include manicures and pedicures, hire three to five new stylists and, in five years, open a second Salon Zen in Virginia, where she’s from, she said.
“It really was a godsend, especially for me being a first-time business owner,” she said. “It feels great to have your own business.”
White-McClellan, of Anointed Future Child Development Center, can relate.
At a friend’s suggestion in 2002, she started her business after spending years taking care of neighbors’ children. Ready to expand, she applied for a loan soon after Burch’s announcement and was approved last May. Today, she talks about her refurbished child care center with pride.
“This place is beautiful,” she said. “We have the prettiest red metal roof ever on the east side of Charlotte.”
Continuing to expand
In November, Bank of America’s charitable foundation and the Tory Burch Foundation made an additional $2 million investment in Elizabeth Street Capital. That helped expand the program to Los Angeles and cities in Illinois, Missouri and Texas, where $1 million in loans has been distributed to female business owners, the foundation said.
To apply for the Elizabeth Street Capital program, visit www.self-help.org, then click on Business, and Loans & Credit.