Partner Spotlight: California Rebuilding Fund

The COVID-19 pandemic devastated global economies, shuttering businesses and triggering one of the worst job crises since the Great Depression. Small businesses, most especially those led by women and people of color, were disproportionately affected with 41% of Black-owned businesses and 32% of Latinx-owned businesses closing by mid-April 2020. The top two reasons for closing were lack of access to credit and limited personal or business reserves.

Recognizing small businesses’ urgent need for affordable credit, Visa Foundation rapidly deployed capital to on-the-ground partners, including a $5.5 million investment into the California Rebuilding Fund (CARF). Established at the peak of the pandemic to support California small business owners, CARF is a public-private partnership between the state’s Infrastructure and Economic Development Bank (IBank) and private investors, philanthropic organizations and local governments. With strong and local representation at the table, Visa Foundation entered this partnership knowing our investment would be deployed by Community Development Finance Institutions (CDFIs), which not only had operated in these communities for decades but knew what small business owners needed during this time to survive and build resilience.

Since then, this innovative model has had a transformative impact on California's small businesses. To date, CARF has deployed $81 million in affordable loans to 1,385 small businesses, 48% of which are owned by people of color and 37% of which are women-owned. 

For Alicia Villanueva, a California Rebuilding Fund loan saved her business. Alicia’s restaurant, Tamales Los Mayas, was selling more than 4,500 tamales a week when the pandemic reduced her sales by 88%. Alicia had 10 employees depending on her, including members of her own family, and without short-term financing to cover her monthly expenses, she would have to shutter her business. Alicia secured a loan from the California Rebuilding Fund and used the capital to pay her staff and invest in Tamales Los Mayas’ growth.

Portrait of Alicia Villanueva, whose restaurant, Tamales Los Mayas, was saved by a California Rebuilding Fund loan.
Today, nearly three years after receiving the loan, Tamales Los Mayas has grown and been able to move into a 6,000 square factory. With doors wide open, Alicia is busier than ever. Tamales Los Mayas’ 14-person team makes over 6,000 tamales a week and is selling its products at farmers markets, local San Francisco grocery stores and catered events. Alicia’s income has increased, and she feels her business is more resilient and far better prepared to withstand economic challenges. Equally important, it has given her the confidence to continue hiring people like her who want to make a living for their families.

Supporting thriving communities is at the core of our work. During the COVID crisis, it was critical that small business owners have access to reliable and scalable capital. It’s why this Fund is important and why Visa Foundation’s support made a difference. With their partnership, the Fund was able to reach over 100 small businesses within just one year.

 – Bulbul Gupta, President and CEO, Pacific Community Ventures