By Megan Sayles, AFRO Business Writer,
Report for America Corps Member,
Capital Impact Partners and CDC Small Business Finance, two established national nonprofits based in D.C., recently merged and joined forces with Ventures Lending Technologies to create Momentus Capital, an organization that provides a continuum of social, financial and knowledge capital for local leaders, businesses and community organizations to bolster economic mobility and wealth creation.
Momentus Capital particularly seeks to support African-American entrepreneurs and communities who continue to be excluded from traditional financial services and the banking system.
“Ultimately, our vision is to create a diversified, mission-driven financial services firm that provides communities with the opportunity to to build inclusive and equitable opportunities in their communities,” said Ellis Carr, president and CEO of Momentus Capital.
Each of the organizations under Momentus Capital, which have already invested more than $250 million in D.C. overtime, will continue to operate as separate entities to serve their key markets, but they will pool their resources and offer new products.
The Impower loan, Momentus Capital’s alternative to the Small Business Administration’s (SBA) 504 loan, targets entrepreneurs who have been denied a commercial real estate loan and assists them in creating new ventures in low- to moderate-income communities. It also has no minimum credit score requirement.
With its Equitable Development Initiative, Housing Equity Accelerator Fellowship and Growing Diverse Housing Developers program, Momentus Capital will provide training, mentorship and avenues to financing for Black and Brown developers, as well as greater access to affordable housing for the larger community.
“It’s critical that we provide opportunities to have income and wealth generation in communities, and the way we think about that is through small businesses and ownership of your building that you’re operating in as a small business,” said Carr. “We also know that foundationally a healthy community is defined by having safe and affordable housing that does not take up an astronomical percentage of your income.”
Although Momentus Capital has a presence nationwide, it takes a local, place-based approach to better reach small business owners, social entrepreneurs, equitable developers and policymakers.
In Michigan, the organization has already begun piloting a new lending program, Activate Detroit. The loan product is credit blind—using character-based evaluations instead— and targets Black small businesses.
The organization decided to launch the product after discovering that only 1 percent of African-American entrepreneurs in Detroit, which is a predominantly Black city, were eligible for SBA community advantage loans due to poor FICO scores.
After refining the product, Momentus Capital plans to scale the Activate loan nationally, and D.C. will be one of the next markets to offer it.
This fall, Momentus Capital will also launch an Impact Investing group, which will provide equity investments and venture debt for minority-led firms so they have the necessary capital to scale their businesses.
“It’s about building new capabilities so that we can really provide and marshal the right type of capital into the community so that the residents in those communities can really fulfill the dreams that they have for themselves,” said Carr.
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