FUNDING THE future ECONOMY

BY BREAKING DOWN BARRIERS

Empowering women entrepreneurs is a crucial step towards closing the gender gaps in business creation and wealth building. With women representing half of the world’s working-age population, investing in their success is not only a matter of equality but also an opportunity to drive innovation, create jobs and enrich the economy.

Women-led businesses have the potential to add $12 trillion to the global economy by 2025 (Source: McKinsey Global Institute (MGI) Report). Supporting women entrepreneurs isn’t just a matter of equality; it’s an opportunity to unlock immense economic growth and prosperity.

SOCAP FUND
STRATEGIC INTENT

The SoCap Fund strives to break down systemic barriers for women entrepreneurs who seek capital to strengthen or grow their businesses, and offers patient, flexible, and affordable loans to women entrepreneurs. This pilot initiative is an opportunity to learn alongside women entrepreneur partners and influence traditional financial institutions and their underwriting process.

THE SOCAP FUND IS A PARTNERSHIP
BETWEEN FORGE AND SOUTHERN CAPITAL PROJECT

Recognizing the barriers that hold women entrepreneurs from accessing capital, Southern Capital Project and FORGE have developed an alternative approval process:

• Process and documents are clear and concise
• An investment committee of women entrepreneurs and leaders in the ecosystem
• Approval based on character, commitment, and ability to repay
• Ongoing connection to resources and networks

HOW IT WORKS

1. Loan capital is provided by FORGE.

2. Grant capital supports Southern Capital Project to provide connections to the technical assistance and to verify.

3. SoCap Fund partners with technical assistance providers and entrepreneur support organizations (ESOs). ESOs provide referrals and technical assistance/mentorship.

4. Borrowers apply for a loan with the endorsement of the verifier: By working with a designated verifier, borrowers get technical assistance and one-on-one support throughout the application process.

5. The borrower must be endorsed by the verifier to qualify for this loan fund.

6. After FORGE makes the loan, the borrower must continue to work with an ESO referrer and/or Southern Capital Project during the duration of the loan and provide outcomes data on an annual basis.

For this Pilot initiative: Southern Capital Project is a verifier and FORGE is a CDFI that makes loans.

THE FUND Investment Committee Financial Capital Fund Social Capital (Mentorship and con n ection to ESO partners) (Partnership wit h local CDFI) Woman Entrepreneurs Donations and invest m ent

ELIGIBILITY CRITERIA

The criteria for eligibility is as follows:

  • Majority owned (51%+) by a woman (cis* or trans), non-binary, gender-fluid or gender non-conforming people.

  • Led by a woman (cis* or trans), non-binary, gender-fluid or gender non-conforming people. “Led by” refers to the senior leadership role of CEO/President.

  • The business does not have to be incorporated in Arkansas, but it must operate business in Arkansas. A Federal Employer Identification Number is not required, but a business bank account is highly encouraged.

  • The business model must be viable – most recent six months of positive revenue history.

  • The owner must show capacity/ability and commitment to execute the business model.

  • Borrower must be endorsed by SoCap Fund Verifier, Southern Capital Project

    *cis: a term for people whose gender identity matches the sex that they were assigned at birth

QUALIFYING PURPOSE AND USE OF LOANS

Examples of impact sought from investments:

Retaining or creating jobs Addressing challenges within the community Establishing stable and needed businesses within the community Creating additional revenue streams Supporting the growth or expansion of existing businesses

FUND DETAILS

  • Character-based/Alternative lending

  • Size of initial fund: $107,500

  • Types of Investment: Loans

  • Loan Management: FORGE

  • Decided by investment committee, including women entrepreneurs and ecosystem partners
  • Geographic Focus: Arkansas

  • Terms

  • Data & Outcomes

  • Demography and geography

  • Baseline Data

  • Credit score
  • Gross revenues

  • Net revenues

  • Net worth

  • Number of employees

  • Follow-up data on an annual basis

INSPIRING NEWS