U.S. Route 90, as it heads west from Downtown Jacksonville, is called Beaver Street. The stretch of road serves as the spine of an area that has historically been a collection of businesses that served or benefited from the massive freight depot in the northwest part of the city. “It’s a 100-year-old industrial district beside the CSX rail yards,” says Chuck Shealy, real estate and lending program officer at LISC Jacksonville. But, recently, smaller manufacturers and other businesses began popping up in the area next to long-standing ones, like Beaver Street Fisheries. LISC Jacksonville began studying the market more closely and found that it houses more than 100 unique small businesses. The newer businesses in the area, which was rechristened the Rail Yard District, include architectural salvage company Eco Relics; social enterprise Rethreaded, which trains former sex trade workers in soft goods production; and Engine 15 Brewery.
“There are about 6,500 jobs in the one-square-mile area now, but only about five percent are held by residents from adjacent communities,” says Shealy, describing Jacksonville’s predominantly African American Neighborhood. “Our goal is to try to reverse that.”
One way they’re aiming to do that is by stepping up support to identify entrepreneurs of color and help them launch or grow their businesses. LISC Jacksonville partners include the Beaver Street Enterprise Center, a small business accelerator in the neighborhood with a diverse clientele. In addition, Northwest Jacksonville CDC is an outreach partner in the communities around the Rail Yard District and provides temporary outdoor retail pop-up space for entrepreneurs in the neighborhood.
LISC Jacksonville is also looking at innovative financial products to support entrepreneurs of color. They are exploring opportunities with local philanthropies to create a first-loss fund. First-loss capital is socially- and environmentally-driven credit enhancement provided by an investor or grant-maker who agrees to bear first losses in an investment in order to catalyze the participation of co-investors who can’t be exposed to higher risk in their lending. “The fund will allow us to lend to business owners who may not have as strong a balance sheet,” Shealy says. “We’re aiming for it to support about $1 million in lending to up to 20 businesses. To my knowledge, this would be the first fund of its kind in the region. ”
The new lending capacity comes just as the business community in the Rail Yard District is also galvanizing, Shealy adds. Given the influx of new businesses, the neighborhood has the potential to become a regional destination. LISC Jacksonville has been supporting area business owners to formally organize into a business council that will capitalize on the area's assets, add new signage, paint murals on blank walls, market the neighborhood, and improve long-neglected infrastructure. “The time is ripe for the businesses here to come together and advocate for themselves and those that will come after them,” he says. “And LISC and the other community funders are here to support them in doing that.”
This case study was co-authored by Mark Foggin and Johnny Magdaleno and published in 2020 as part of the Urban Manufacturing Alliance’s “Forging Fairness: How community-based lenders are centering both inclusion and manufacturing to promote equity [link to report].” This report highlights the work of practitioners in UMA’s Pathways to Patient Capital cohort and how these leaders are helping entrepreneurs of color – including makers and manufacturers – access to the capital and know-how they need to realize their business ideas and plans at scale.