WBEs Getting What They Want in Growth Financing

In a first-of-its-kind survey, I-WE asked Women Business Enterprises what they wanted in growth financing, and found a gap of tools and services available to the “missing middle” - businesses with revenues from $500k - $5m. Women want to grow and scale their successful businesses but are disproportionately turned down for the specific financing they require to grow. 

From the survey came a focus group, led by a team at Bank of West that was interested in this particular group of mature WBEs who are well-positioned to take on growth financing and yet frustrated by lack of access. Heading up the focus group were Bank of the West’s Monica Taymuree and WBEC-West’s Jaymee Lomax. Both bank relationship managers and WBEs came together to identify the key barriers between the banks and WBEs. 

What was unearthed was that WBEs need more advanced coaching and support on forecasting, how to get the most out of a LOC, and how and when to cultivate a relationship with a business banker, among many other things. It was also clear that many underwriters don’t understand the WBE’s businesses and end up “mis-financing” them, offering products that aren’t a good fit for the business. Another challenge is the lack of collateral and personal assets that banks want to secure a loan.  This could be addressed by obtaining credit enhancements and by banks creating special targeted loan programs within their CRA commitment. 

During the focus group, Bank of the West also presented on what it is that banks are looking for in borrower applicants. In addition to a good credit report (or an explanation of why it isn’t good), their Dun & Bradstreet report, personal guarantees and evidence of ability to repay, business owners need to  show market trends in their industry that support their assumption of financial growth. They need to understand their financials inside and out, and to have a diversified client base. 

Through the focus group, WBEs were able to be heard, and the WBEC leaders and BOTW both gained insight into knowledge gaps that need to be filled on all sides. The I-WE team agreed to coordinate the development of a webinar series to address the identified needs, to be delivered during early part of 2020. The goal is to create a clear roadmap and build understanding, trust, and strong relationships between the WBEs and committed lenders – both banks and CDFIs. We can see that as banks begin to understand this specific group, it will lead to greater financial growth opportunities for even more women business owners!

A big and heartfelt thanks to Monica, Jaymee, their teams, and the women of WBEC-West that have brought this to life! We couldn’t make such progress without their curiosity and participation.