Economic Development and Small Business & Startups

Funding fuels GRABB’s accelerator program

Initiative has helped 15 African-American businesses get started, keep going.

August 10, 2018
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Grand Rapids’ Economic Development Corporation continued its $80,000 contract with Grand Rapids Area Black Business, and the funds will help the organization as it continues to accelerate African-American-owned businesses in Grand Rapids.

The Business Journal previously covered the use of EDC funds to boost the GRABB 5 Business Accelerator program, a six-month process by which the organization works with five black-owned businesses at a time to help improve their success rates.

GRABB Founder and CEO Jamiel Robinson said the focus of the accelerator program is to help businesses reduce barriers and identify resources already available to them. Without providing direct funding, the program helps businesses locate resources already available to them.

“We point them to accessing networks and relationships, which is especially hard in the African-American community,” Robinson said. “GRABB 5 is, to an extent, a ‘cheat code’ to build relationships. We have a lot of partners so we can help leverage relationships with people.”

Robinson administers the program alongside Jonathan Jelks, co-founder of the Midwest Tech Project, which is separate organization connecting inner city students and the community with career opportunities in technology.

One of the resource GRABB 5 helps unlock is community development financial institutions like Marquette-based Northern Initiatives.

Robinson said CDFIs like Northern Initiatives help clients receive loans if they’ve been turned down by a conventional institution based on poor personal credit, poor payment history or if the business model is deemed too risky.

Another available resource, Robinson said, is free accounting and free legal aid through the Pure Michigan Business Connect program.

The Michigan Economic Development Corporation developed the PMBC in 2011 to connect small- to medium-sized Michigan businesses with national and global companies.

According to the MEDC, PMBC has facilitated almost $6.7 million in new contracts, worked with over 500 global corporations, facilitated over 10,000 supply chain meetings and provided business connections across 25 industries.

“A lot of our entrepreneurs didn’t know about these,” Robinson said. “Awareness around those resources was lacking in the African-American community.”

Since its inception in 2016, the GRABB 5 program has helped 15 black-owned businesses in a variety of industries that include food service, hair care and nonemergency medical transport.

Richard Flowers, owner of Reliable Medical Transport, said even though he started his business with bad credit, GRABB was able to connect him with Northern Initiatives to help him achieve the capital necessary to reach his goal of one day becoming a million-dollar company.

“I’ve been in business for barely three years,” Flowers said. “I started the business with bad credit and no money, just a strong belief system.”

Reliable offers transportation services to senior citizens, wheelchair clients and other disabled individuals throughout Kent County.

The company currently operates a fleet of seven vehicles. With the loan from Northern Initiatives, Flowers said he could pay off what he currently owes on those vehicles, as well as buy four or five more while still meeting his monthly payments.

A bigger fleet is exactly what Reliable will need in the coming weeks. As of press time, Flowers said he was about to begin a contract with Mary Free Bed Rehabilitation Hospital, as well as two other contracts with American Medical Response starting Aug. 15 and Forest View Hospital around the end of the month.

Based on Flowers’ numbers, outsourcing with Reliable could save these clients a significant amount on transportation services.

“For instance, a rehab facility might purchase their own vehicle, then they need to purchase liability … for a 10-mile radius, it could cost $250 a trip,” Flowers said. “If I do the same transport within a 10-mile radius, it’ll cost the client $70 a trip.”

Flowers now is past the six-month accelerator process with GRABB, but the organization is still maintaining contact with his company to ensure he reaches his goals.

“It’s tough being a black-owned business here, because of the ‘good old boy’ connection,” Flowers said. “I’m really resilient. I don’t give up, and Reliable will become a household name.”

Although the GRABB 5 program isn’t focused on the entirety of economic despairs within the African-American community, Robinson hopes its narrow focus will help move the city toward a positive direction for African-Americans’ success.

Robinson pointed to a Forbes article published in 2015, which ranked Grand Rapids number 51 of the 52 largest cities in America in terms of opportunities for African-Americans.

“We’re not looking for this to be the ‘magic bullet’ to cure the 51 out of 52, but this is one of the many efforts to address it,” he said.

Other businesses that have participated and continue to participate in the GRABB 5 program include Load a Spud Potato Bar, Malamiah Juice Bar, Destite Hair Collection, Mosby’s Popcorn, Polished Nail Bar and Spa, and Blaquebox, a subscription service that delivers products from black-owned businesses around the world.

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