In November 2009, Goldman Sachs Group, Inc. announced a new $500 million initiative to aid 10,000 small businesses in underprivileged communities throughout the United States. As a kind of follow through to the widely held view of experts that education, capital and support are the keys to unlocking potential, Goldman Sachs’ initiative will provide a combination of business and management education, mentoring and networking, and access to capital to support small business owners in hopes of creating jobs and economic growth from the ground up. Of the initiative, Dr. Michael Porter, Founder and CEO of Initiative for a Competitive Inner City, and Bishop William Lawrence University Professor, Harvard Business School said, “The 10,000 Small Businesses program will meet a vital need in disadvantaged communities, which is to provide the training, tools, and relationships to help local entrepreneurs and their businesses grow and create a self reinforcing cycle of economic opportunity.”
While this sounds like a great investment for Goldman Sachs and small businesses across the United States, there is some speculation that the money may not be spent effectively. According to their press release, Goldman Sachs will allocate $200 million to partners who can provide scholarships to predominantly underserved small business owners to build educational capacity; and $300 million through a combination of lending and philanthropic support to Community Development Financial Institutions.
In an article on inc.com, staff writer Kasey Wehrum pondered whether Wall street bankers and community development groups understand entrepreneurs well enough, so he asked entrepreneurs, investors, and experts how they would spend the money… to read their comments and view the article, click here.