Founder and Senior Advisor, Opportunity Fund
Founded in 1994 under Eric Weaver’s leadership, Opportunity Fund is a community development financial institution based in California with a focus on microlending. With the largest loan portfolio under management among US nonprofit microlenders, the organization is positioned to encourage microenterprises and other small businesses to improve job quality and help companies already providing quality jobs to grow. Recently, Opportunity Fund expanded to 12 additional states and has increased its maximum loan size to $250,000.
Currently, Opportunity Fund has more than 5,500 active clients and a loan portfolio of more than $160 million. “With thousands of clients in our portfolio, Opportunity Fund has a tremendous opportunity to undertake job quality promotion at scale,” says Weaver. “Now that we are making bigger loans, even more of our clients will have larger revenues, more employees, and the means to upgrade job quality.”
Equity in Business Ownership
Access to capital can be a barrier to business ownership for women and people of color. Data on small business lending demonstrates that women-owned businesses are approved for small business loans at lower rates compared to other businesses, and when they are approved, receive smaller loans on average. Additionally, research has shown that black and latinx-owned small businesses are less likely to receive approval for financing compared to similar white-owned firms, and owners are more likely to feel discouraged from applying out of fear their applications will be rejected. CDFIs with a focus on equity, like Opportunity Fund, are working to change this. As of March 2019, of Opportunity Fund’s 5,750 clients, 64 percent are low- or moderate-income, 88 percent are people of color, and 30 percent are female.
Currently, Opportunity Fund is exploring working with Pacific Community Ventures to pilot its Good Jobs, Good Business toolkit with small businesses in its portfolio. Weaver also plans to conduct research to better understand the quality of jobs its small businesses currently offer and test incentives, tools, and technical assistance strategies to sustain and grow quality jobs within its network.
Part of Opportunity Fund’s ability to expand its reach nationwide is due to innovative partnerships it has formed with banks and financial technology (fintech) companies. In 2015, Opportunity Fund joined with LendingClub, the world’s largest online credit marketplace, to offer a second look for small business owners who do not qualify for loans with the fintech company, helping to expand access to affordable capital. Such partnerships help Opportunity Fund to grow its portfolio while supporting more small business owners to create jobs and strengthen their communities.
Even as Opportunity Fund grows, the majority of its clients remain microenterprises – many with no employees other than the owner – and Weaver sees self-employment as an opportunity for improved job quality.
“I want to make sure we’re not defining job quality too narrowly,” says Weaver. “15 million people in the U.S. are self-employed, and millions more are working for very small companies. Our borrowers are choosing self-employment over multiple minimum wage jobs. Through self-employment, they are giving themselves flexible and predictable schedules, and agency in the workplace. They are also offering employment to people in their families and their neighborhoods, where jobs can be hard to find.”
Recognizing an opportunity to improve job quality among microenterprises, Opportunity Fund is exploring strategies to connect business owners, including sole proprietors, to products that support financial health through savings funds for emergencies, retirement, or college tuition.
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Learn more
Eric Weaver is a member of the Job Quality Fellowship, Class of 2018-19. The Job Quality Fellowship is a project of the Aspen Institute Economic Opportunities Program.
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