Friends and family funding for entrepreneurs not ready for loans who don't have a rich uncle

1. Community
Equity Fund
Partners for Equity in Economic
Mobility and Community Development
EAGLE MARKET STREET DEVELOPMENT
CORPORATION
EAGLEMARKETSTREETDEVELOPMENTCORPORATION

2. EMSDC
INTRODUCTION
Our Mission & Focus:
Mission
• …Develop people, property, and business
and envision equitable, inclusive economy
for all
Focus
• Improving the lives of Black and Brown
communities by means of:
⚬ Opportunity
⚬ Empowerment
⚬ Awareness
⚬ Education
Founded in 1994 under the leadership of Dr. John H. Grant and the auspice of
Mt. Zion Missionary Baptist Church.

3. Programs:
EMPL, LLC
⸙ Residential and Commercial Leasing
Incubate to Innovate
⸙ Commercial Leasing @ Below Market Rate
Individual Development Account (IDA)
Community Equity Fund
⸙ Nontraditional Capitalization for Small Business
Community Benefit Partner
⸙ Fiscal Sponsorship

4. The Challenge
a
Nontraditional Financing Model
for
Black and Brown Businesses
Global Pandemic • 50% of Black and Brown Business are at risk nationally during
COVID-19
• If you don’t know when your customers are coming back,
taking on debt is irresponsible
• Many Black and Brown businesses still do not have access to
loans
Not A Time for Debt

5. The Challenge – cont’d
…the Wealth Gap
In the 2019 survey, European American families have the
highest level of both median and mean family wealth:
$188,200 and $983,400, respectively Black and Hispanic
families have considerably less wealth than European
American families. Black families' median and mean wealth
is less than 15 percent that of European American families,
at $24,100 and $142,500, respectively. Hispanic families'
median and mean wealth is $36,100 and $165,500,
respectively. Other families—the median, reflecting the
concentration of wealth at the top of the wealth distribution
for each group. (https://www.federalreserve.gov/)

6. Community Equity Fund Community Champions The Business
WHERE TO
START
THE FUND, performs as a pooled income
fund, an instrument which allows it to achieve
its mission as an “evergreen” or self-
sustaining fund, while giving you an
applicable tax deduction and lifetime income
from annual dividends from the invested
businesses, unless you opt to have that
annual income return to the Fund. Upon your
death, the remainder of your gift is donated
to the Fund. This link will take you to some
detail about how pooled income funds often
operate in university development programs,
click here.
WE INVITE YOU TO INVEST INTO YOUR
COMMUNITY, You become a Community
Champion, a partner in CEF. You have the
opportunity to be a donor-investor in the
mission of community healing. Your tax-
deductible charitable contribution will create a
legacy for Black and Brown business owners.

7. Case Study: Bread & Butter - Coffee and Co-
Working Space
Bread & Butter, led by two African American males with
business experience and grosses $100k in annual
revenues
The Business
Comparables value the business @ $150,000
Value
Community Equity Fund, provides an injection of $30,000
in equity capital for 20% ownership stake in the business
for the life of the transaction, approximately 84 mos.
Capital Injection

8. Life Span -
Flow of
Injection
After the grace period, 24 mos. Bread &
Butter’s (B & B) revenues grows to a
minimum of $200,000.
Starting in month 25, B & B begins
repayment to the fund, dividend shares,
7% of annual gross revenue, payable
monthly or quarterly typically a period of
3/5 years.
At full repayment the Fund receives
150% return on capital invested.
EAGLE MARKET STREET DEVELOPMENT CORPORATION

9. $45,000 = 150%
Allocation of Dividends
EAGLE MARKET STREET DEVELOPMENT CORPORATION
$30, 000 – t o Com m u n it y Equ it y Fu n d –
100%
$9,000 - Management Fee – 20%
$6, 000 - Donor-Investors Income Pool – 30%

10. REPLICATION ACROSS THE
FUND
The fund continues to get 100% of
the return from the revenue
dividends shares from each equity
injection. 100% of that return is
invested again
40% of the revenue share
dividends flow to the pool which
pays lifetime income to donors
The goal is to provide equity
capital to help Black & Brown
businesses who often lack access
to capital become viable.
The fund will secure a $150,000
loan guarantee, to cover potential
failures rates of 15%.
EAGLE MARKET STREET DEVELOPMENT CORPORATION
01 02 03
"You r don a t ion con t in u es t o cycle t h rou gh you r com m u n it y."

11. B & B and other Black and Brown owned businesses
are on their feet, having used the 24 months of
runway offered by equity before they had to start
paying seven percent of annual revenue to their
donors. They have paid off people who took a chance
on them, giving them equity, with no collateral
attached.
More established, B & B and the other businesses in
the fund portfolio are perhaps able to access
expansion capital from Mountain Biz Works, Self
Help, or even a traditional bank.
AFTER FRIENDS AND FAMILY FUNDING
"The Community Equity Fund acts like
a virtual rich uncle providing friends
and family capital to entrepreneurs
who can’t access traditional sources of
capital. It is a key missing link in the
path creating intergenerational wealth
for black and brown families. We plan
to make this model replicable to other
cities and towns to solve the friends
and family gap for entrepreneur who
don’t have a rich uncle."
EAGLE MARKET STREET DEVELOPMENT CORPORATION

12. Contact Us
We'd love to talk about
all things Community Equity
Fund.
Stephanie Swepson-Twitty
Phone Number
(828) 281-1227
Email Address
info@eaglemarketsts.org
Website
https://eaglemarketsts.org/