Monday, July 30, 2012

A Win-Win-Win Collaboration – Circle Bank and Women’s Initiative

By Elizabeth Krueger, Summer Fellow (@elizlk)

You may have heard that Women’s Initiative partnered with Circle Bank to make loans to Women's Initiative graduates. Now in its second year, the program is expanding, and is a win for all concerned. Why does this partnership make so much sense?

Under Community Reinvestment Act (CRA) regulations, banks are required to provide a portion of their investments/services to underserved communities in areas where the banks do business. This can range from helping to finance low-income housing projects, to providing low-fee services.  Microlending can also meet CRA requirements, but the effort to do underwriting (background & credit checking, and business plan due diligence) can outweigh the small loan amounts, which range from $1,000 to $50,000 currently. (Typical bank loans tend to start at $500,000.) The bank regulatory requirements for tracking the risks of their loan portfolios can also add to costs. These combined underwriting and regulatory costs discourage banks from microlending as part of their CRA activities.

In the Circle Bank partnership, Women’s Initiative is able to offset the underwriting costs. The Women's Initiative financial services team does the necessary work to ensure the borrower meets the agreed underwriting standards, and provides the documentation to Circle Bank.  Because Women's Initiative has an existing relationship with the borrowers, the underwriting effort required is lower than if the bank were to do it directly, so the process overall is more efficient.

Through the Circle Bank/Women's Initiative partnership, more Women's Initiative graduates have access to appropriate loans for starting or expanding businesses. This increases the impact of women in their communities and families, helping more women on the way to economic self-sufficiency.

It’s a win-win-win proposition that more banks and microenterprise service providers should consider: 
  • Circle Bank wins by meeting CRA needs and helping grow its customer base
  • Women’s Initiative wins by meeting financing needs of more graduates by providing underwriting at lower costs than banks could 
  • Women’s Initiative graduates and their communities win by getting access to capital for new and growing businesses, and the positive ripple effects they generate.

    Wednesday, July 25, 2012

    What does the new California budget bill mean for low-income women?

    By Shelley Hughes, Summer Fellow, Women's Initiative

    The California budget is a source of ongoing debate, analysis and stress for legislators and Californians alike. Each year the government embarks on a lengthy and complicated journey to develop an annual budget that must get passed by the Super Majority before it is sent to the Governor for final signature.  

    Last month, Jerry Brown signed the 2012-2013 California state budget bill and outlined a plan to raise $8.5 billion in 2011 – 2013 by increasing personal income tax rates on very-high-income Californians for seven years and raising the state sales tax by one-quarter percent for four years.  The Women’s Foundation of California, who launched the “Stand With Women” campaign to challenge budget cuts that would negatively affect women in our state, recently outlined what the signed budget means for low-income women:

    The good news:
    -          Doesn’t cut Cal Grants for public university and college students.
    -          Doesn’t restructure CalWORKs, the welfare-to-work program that serves 1.4 million poor Californians, 1 million of whom are children.
    -          Doesn’t lower the market rate reimbursement for child care providers, which would have put many quality providers out of business and had a devastating effect on parents who rely upon them.
    -          Doesn’t move child care under the Department of Social Services. Child care remains the responsibility of the Department of Education, as it should considering that child care needs to support children’s educational development.

    Of concern:
    -          There are now 26,000 fewer child care slots for needy children, leaving parents with fewer child care options while they’re at work or attending school.
    -          Time on CalWORKs has been reduced from four years to two. In a difficult economy, two years is rarely enough time for families to establish economic security.

    Although the budget is signed, voters must pass the Governor’s ballot measure in November in order for the bill to take effect. If voters reject the measure on Nov 6, the budget agreement would trigger $6 billion in spending cuts that would come into effect January 1, 2013 and primarily affect public school, colleges and universities.

    The complete budget summary can be accessed here:

    Monday, July 23, 2012

    Seeing the World Through New Eyes

    By Ewelina Salaga, Summer Fellow

    Graduates of the San Francisco ALAS class with their certificates and trainer Sandra Murillo (left)

    With a smile and confidence in their faces, thirty two graduates from Simple Steps and ALAS classes from the San Francisco branch of Women’s Initiative entered the ING Direct CafĂ© on July 18th, 2012 to receive their certificates enabling them to start a new chapter in their lives. This certificate confirms their rewarding accomplishment- exciting, fascinating, and challenging at times. These women finished an eleven week program at Women’s Initiative that prepares them to establish their own business, ranging from being a math tutor to a professional health adviser. Not only does the program teach women business plan preparation and break-even point analysis but also, most importantly, confidence, self-esteem, and improved communication skills, so essential in the business world.

    Proud grads share their business pitches with confidence

    Indeed, remarkable achievement was seen when each of the graduates presented their own commercial of their new business. There were a lot of touching moments that show how vital it is to be comfortable speaking in public. Some women wouldn’t have been able to do it 11 weeks ago but with the Women’s Initiative program, the graduates were able to overcome obstacles. With a different level of confidence and sometimes with a little help in the form of a note, all the graduates proved that they felt comfortable in their skins and at the end they shone on the stage.

    Throughout the ceremony valuable advice was given by the speakers. As Adriana Lahl, one of the previous graduates of the Women’s Initiative program currently running her own business said, by working hard, paying bills on time, improving their credit score, the graduates will get what they want to get so success is in their hands. Also, she reminded the graduates to continually invest in clients, training, and consulting. At the end, Nicole Levine, the executive director of Women’s Initiative, summarized the ceremo
    ny by highlighting importance of staying connected with Women’s Initiative and being an active member of the SuccessLink Program that connects people and businesses.

    After the ceremony all the proud graduates with their families and friends mingled together around a cake and appetizers to talk about their future plans, plans that are exciting and the graduates look forward to realizing. Certainly, with greater confidence, competence, and belief in them, the graduates from now on will perceive the world through new eyes, more bright and colorful.

    It's a family affair!

    Thursday, July 19, 2012

    Oakland Connect Event Recap

    By Kendall Warson, Women’s Initiative Intern

    Michael C. Bush (right) and Ian Philabaum (left) at the Connect Event

    Last night in Preservation Park in Oakland, Success Link Specialist Ian Philabaum organized a highly informative, fun, and engaging Connect Event for Women’s Initiative. The organization holds such events to support graduates in maintaining a strong and successful business through the inevitable ups and downs they face.

    Yesterday evening, Michael C. Bush was invited to speak to graduates and supporters of the program. Michael was born with an intuitive interest in business. He has an impressive resume, having taught at Stanford and Mills colleges. He also founded Inner City Advisors, a non-profit organization which focuses on creating jobs in urban areas. Specifically, he teaches an
    “8 Factors Framework” which he spoke about last night in tandem with the subject of “Intelligent Risk Taking”. His words were real; he truly confronted the issues and challenges that small business owners face. Ultimately, by having a strong mission and core business values, Michael believes taking risks is the true key to advancing one’s business. He presented a challenge: to confront one’s fear and step past it.

    After Michael spoke, the attendees at the event did activities at their respective tables. Graduates and connectors (volunteer business leaders from the community) identified risks they had taken in the past. Furthermore, the groups discussed personal business issues. Each business owner explained the risk they would need to take to overcome the problem. At the end of the discussion, everyone was able to share whether or not they felt it would be an “intelligent” risk for the small business owner to take.

    The event was not only entertaining to attend, but empowering to be a participant in. Michael’s words spoke candid truths about risk and he was able to inspire graduates as well as connectors to empower themselves to make thoughtful changes which may have uncertain results. The entire night was a complete success and a played out harmoniously.

    Realities and Potentialities in Gender Equity

    By Rachel Adler, Summer Intern

    Alicia Robb of the Kauffman Foundation of Entrepreneurship wrote a recent post for the Forbes blog entitled "Women: It's Time to Own Your Potential."  This title represents the juxtaposition of challenge and promise that women entrepreneurs embody. 

    As Robb describes, there is much work to be done towards gender equity in the business world.  "Women own less than 30 percent of all businesses and only 16 percent of businesses with paid employees," Robb states, and "Women-owned firms generate just 4 percent of total revenues, 6 percent of employment, and 4.5 percent of payroll."  Robb also links to a Kauffman Foundation video sketchbook which presents additional statistics about the success gaps between men- and women-owned businesses: women-owned businesses are growing more slowly and have less access to networks of capital than men-owned businesses, for example.

    Robb's post reminded me of Anne-Marie Slaughter's controversial article published this month in the Atlantic Monthly, called "Why Women Still can't Have It All."  Slaughter's article deals more with the stories of women in positions of political authority, rather than exclusively women entrepreneurs, but there are many connections between the struggles and realities of women in these overlapping categories.  There are unique challenges for women working to succeed in business, political, and academic positions that men in similar positions do not face.  Slaughter's article calls out cultural concepts of time, family values, and the arc of a successful career, among others, as some of these unique challenges.  Robb points to a lack of female presence in investor networks and on boards of directors as others. 

    These articles do a good job of presenting the realities of women's empowerment today.  They do not sugarcoat the situation: clearly, there is much work to be done to bring about greater gender equity in business, academic, political, and cultural worlds.  This is why organizations like Women's Initiative are so important.  Through the Simple Steps and SuccessLink programs, women from a variety of low-income backgrounds are empowered to enter the business world with the support of knowledgeable staff, experienced alumnae, and professional networks.  For example, through Connect Events, Women’s Initiative alumnae can network with successful business professionals as potential investors and advisors who can help them grow their businesses in a number of ways.  Through connections such as these, Women’s Initiative programs help narrow the gap between growth rates of men- and women-owned businesses.

    Robb closes her article with notes of inspiration, listing several resources for women who want to launch high-growth ventures, become investors, or join boards of directors.  Slaughter, too, presents a number of ideas and innovations to counter the disparities she details earlier in the article.  There's a lot of work to be done, but with thinkers like Robb and Slaughter, and forces like Women's Initiative, there are many ways to move forward towards a more gender-equitable workforce and culture.

    Tuesday, July 17, 2012

    The Fight for Food: SNAP Benefits & Spending Cuts

    By Kelly Baker, Regional Evaluation Associate VISTA

    "It is hard to believe that in 2012 we are debating feeding people.”

    The hard-hitting final words of Congresswoman Barbara Lee truly strike a chord, considering that the amount of people living under the poverty line has risen to an all-time high, with 46.2 million people living in poverty in 2010.

    Last week, the congresswoman said these words arguing against the proposed new farm bill in the House of Representatives, which proposes $35 billion in spending cuts, including $16.5 billion from the Supplemental Nutritional Assistance Program (SNAP or, more informally, food stamps). By eliminating “categorical eligibility”,
    2 to 3 million people would no longer qualify for the program.

    Unquestionably, SNAP benefits are critical in keeping millions of our citizens out of extreme poverty. In a
    two-part blog post on the outcomes of the SNAP program, Stacy Dean cites a study from the National Poverty Center: “Counting SNAP benefits as income reduces the number of households in extreme poverty in 2011 from 1.46 million to nearly 800,000, the study found (see graph).  And it reduces the number of children in extreme poverty in 2011 by half — from 2.8 million to 1.4 million.”


    About 14% of Women’s Initiative clients first come through our doors dependent upon public assistance. Moreover, 20% of our clients are low-income single mothers and single-mother households have a 31.6% poverty rate, as compared to a 6.2% poverty rate for families headed by a married couple. Many opponents of government assistance programs posit that such programs perpetuate a cycle of dependence. However, we have seen at Women’s Initiative that by providing specialized training and space for personal growth and empowerment, even some of the neediest welfare recipients can become self-sufficient and provide for themselves and their families. In fact, just 12 months after training, only 12% of our clients are still receiving assistance and two years out that number drops to 8%. Additionally, the average amount of benefits received decreases from $575 to $391 after one year, and further reduced to an average of $266 two years after training. Thus, not only do our clients manage to decrease the amount of benefits they receive, but many are able to get off of them entirely.

    Food assistance is a fundamental resource for many of our clients as well as the volunteers at Women’s Initiative. Personally, as an
    AmeriCorps VISTA member, I know that many of my fellow volunteers would not be able to make the full-time commitment to our organization and others like us without this vital supplement to our modest living stipend.

    Thank you, Congresswoman Lee, for fiercely defending an essential program for our community.

    Of course, government assistance programs continue to be a hotly debated topic (just take a look at the comments left on the congresswoman’s
    Facebook post). What are your thoughts? Do you agree with the congresswoman's argument?