Here’s how Fort Worth hopes to pull in $250 million to fund minority-owned businesses

·4 min read
Max Faulkner

The city of Fort Worth begins a new initiative Wednesday designed to give people of color access to funding to invest in their small businesses or nonprofit organizations and for developers to build affordable housing projects.

The program will help match borrowers with funding available through Community Development Financial Institutions (CDFIs), or lending institutions designed to fund underserved communities. The city has committed $3 million to run CDFI Friendly Fort Worth, which will serve as a liaison between CDFIs and the city’s underserved borrowers.

“No one lends money to someone else unless they believe in the borrower’s future. And in too many communities … no one’s believed in their future,” said CDFI Friendly America’s founding partner Mark Pinsky.

Community Development Financial Institutions were born in the 1980s out of a recognized need to erase the wrongs of redlining in America’s communities, where banks drew lines around communities not deemed safe to lend, most of which were communities of color. This resulted in a disparity between traditional financing flowing into rich and white communities and Black and brown communities across the country. A 2010 U.S. Department of Commerce report lists that minority-owned businesses are less likely to receive loans regardless of their size and if they do receive them they are more likely to pay higher interest rates.

“Finance is inherently backward looking: every judgment is based on what did we do last time? And how do we assess risk based on what we did?” said Pinsky. “Finance was not succeeding at getting to people who were outside the mainstream in any way.”

The Community Development Financial Institutions model allows for flexible and affordable lending. The institutions charge less for a traditional loan than a bank or a credit union might, and payment schedules can be delayed when challenging economic conditions such as pandemic shutdowns occur.

“We say, ‘What is it going to take to help you succeed and get this done?’ And we can do that because of the way we’re structured in the world. ... Our investors know that that’s part of the deal,” Pinsky said.

Money for the program comes from banks, federal funds and socially-motivated groups such as faith based organizations.

In the last 15 years, Fort Worth has received $39 of funding per resident through the program, while Dallas has received $71 perresident, and Texas has received $109 per resident. But federal data shows that about 70% of Fort Worth Census tracts were eligible for the funding, according to statistics like poverty levels, percentage of income spent on housing and unemployment rates.

CDFI Friendly Fort Worth is hoping to bring up to $250 million in financing through the program in the next five years. In the last 15 years, Fort Worth received around $39 million in CDFI financing.

“The key is getting CDFIs to pay attention to the market here. They just were overlooking Fort Worth, so we’re gonna make sure that doesn’t happen,” Pinsky said.

Discouraged borrowers

Christina Brooks, the city’s chief equity officer, said the city has started hearing from community members, nonprofits and business owners about how funding might best be distributed.

“They’re beginning to see that there is a new avenue that they could take that they didn’t even realize was available to them,” Brooks said. “People are feeling like it’s OK to dream again.”

Many borrowers in underserved communities are discouraged by the idea of getting funding, Pinsky said.

“They have great ideas, but they’re almost afraid to ask because they’re so used to having financial institutions say no,” Pinsky said.

The ultimate goal of this initiative is to build confidence in both traditional financing institutions and business owners in underserved communities so they will gradually start working with each other more often, Brooks said.

Eventually entrepreneurs “wouldn’t think twice about not walking right in the front doors of a traditional lender, because they understand the process … and what they need to bring to the table,” Brooks said.

Eventually CDFI Friendly Fort Worth will run independently of the city, Brooks said. Plans call for a board to be established and a full-time staff member to be hired this summer.

Mayor Mattie Parker will attend an event to mark the start of the program at 9 a.m. Jan. 26 at the future city hall at 100 Energy Way.

“This is a huge opportunity for Fort Worth to step up its game in underserved areas of our city,” Parker said in a news release. “Funding is an important piece of any project and with the help of CDFI Friendly Fort Worth, it will be less of a hurdle to overcome for residents, businesses and developers in these areas.”

The event will invite community members to share their financing needs, and host CDFI industry speakers.

For more information and event registration details, visit

If you or someone you know has had negative experiences seeking funding for a business, please text or call 817-390-7041 or email at

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