What is supplier diversity and why is it important to underinvested communities?
Supplier diversity programs aim to create and support supply chains that include diverse-owned and -led businesses in procurement sub-contracts with large corporate, government or nonprofit institutions.
Many small business owners do not meet the requirements of large supplier contracts because they often lack access to resources to expand capacity and build organizational systems to scale, which are typically required to win large contracts. Increasing the ability of diverse businesses will help grow local economies and increase job opportunities.
How does the initiative increase supplier diversity and help small businesses?
This initiative is a no-cost unsecured financing program focusing on diverse owned businesses. The funds enable business owners to cover the costs of meeting the minimum requirements for doing business with large corporations, positioning them to compete for and win more procurement opportunities.
Who is eligible for the program?
This program is open to companies nationwide with a focus on Black and Latinx-owned small businesses. Additionally, focus will be given to businesses with:
- annual revenues of at least $1 million, projected to reach $5 million within the program term
- Minority-owned businesses that are MBE Certified, or eligible to attain certification
- 3 years or more in business
- barriers to pending procurement opportunities or specific business need such as cybersecurity, insurance, bonding, infrastructure costs or other third-party expenses related to securing new contracts, and successfully fulfilling them
- Sole proprietors and nonprofit organizations are not eligible for the program.
What type of financial resources does the initiative offer?
The initiative aims to provide growth capital ranging from $25,000 to $250,000 (and up to $500,000 in certain circumstances and with additional vetting) in size to businesses that do not yet meet eligibility requirements to act as suppliers for large corporate and institutional partners. LISC will provide flexible, interest-free funds to help businesses overcome hurdles to expansion. This funding is similar to an equity investment, but without the owner surrendering control or an ownership stake in their business.
Participating businesses will be able to use funds to meet the business requirements of prospective corporate clients. These uses include actions to address management systems, insurance, and compliance with supplier guidelines, such as:
- Technology cyber/network remediation
- Operational control enhancements (i.e., disaster recovery/business continuity)
- Increases to insurance & bonding coverage (cyber, surety/performance, etc.)
- Third party sales, marketing, or other professional service expenses
- Other infrastructure or third party expenses related to securing new procurement contracts or performing against those contracts
- MBE/MWBE or similar certifications
- Growth and expansion plans
Ineligible uses: These funds may not be used for fixed assets, payroll, or debt consolidation.
If a business expressed interest in a previous round but was not selected, can the same business reach out again?
A business may reach out again after six months have passed to determine if it is a good candidate.
Can a business owner express interest in this initiative for multiple businesses?
Business owners may express interest for just one business at a time and must be at least 18 years of age to inquire about participating.
How will a business be contacted if selected to receive growth capital?
LISC will primarily utilize email to communicate with all prospects. Be sure to check your email regularly, including spam folders. Email updates will come from the LISC Supplier Diversity email address: SupplierDiversity@lisc.org.
What documentation will be required?
Businesses seeking growth capital will need to be prepared to submit at minimum:
- Business/growth plan that outlines plans for expansion, job creation and prospective supplier contracts
- Business and Owner Tax Returns
- Interim Business and Owner Financial Statements (P&L and Balance Sheet)
- Business Debt Schedule
- Articles of Incorporation (Corporation) or Organization (LLC)
- Certificate of Good Standing
Funds will be made to qualified businesses, and eligibility is based on accurate and complete submissions. LISC may conduct a background search at our expense and request the submission of additional information to include verification information such as date of birth, SSN, TIN/ITIN, EIN, W-9 and appropriate banking information in order to receive funds.
What additional monitoring and reporting will be required?
LISC will monitor and conduct evaluation activity and program reports of any funds issued throughout the program. This will involve a review of quantitative or qualitative data needed to understand the impact of the initiative. Furthermore, current directors, officers, employees and contractors of LISC and such individuals' family members (spouse, parents, children, grandchildren, great-grandchildren, and spouses of children, grandchildren, and great-grandchildren) are not eligible to apply or seek an award. In addition to verifying there is no such conflict with LISC, prospective program participants will need to similarly establish that s/he does not have a conflict with any donors involved in that particular pool. The list of donors connected to a particular round of resources will be disclosed explicitly for response by finalists.
What other supports for small businesses does LISC provide?
LISC is committed to sharing resources and services that support small businesses throughout the country. Visit lisc.org/small-business to learn more.
How do I know if the information I submit is secure?
Information provided through the online intake process is the responsibility of each business owner. Information submitted to LISC will remain confidential to the general public and any fellow applicants. Applicants will not hold LISC, its affiliates, members, partners, and staff liable for any losses, damages, costs, or expenses, of any kind relating to the use or the adequacy, accuracy, or completeness of any information loaded in the form. See LISC's Privacy Policy for more details. Data entered online utilizes a secure form via Form Assembly. More info.
Have additional questions?
LISC monitors inquiries sent to SupplierDiversity@lisc.org and will post answers to new frequently asked questions (FAQ) on this page in an effort to support transparency and equal access to information for all interested businesses. Business candidates are encouraged to check the FAQ regularly for updates.