About Salaam
Founded in 2024 by a group of Brown, Black, immigrant, refugee, and Indigenous community members in the DC metropolitan area, Salaam Equitable Opportunities Fund is a value- and mission-driven, national non-profit 501(c)(3) corporation revolving loan fund and an aspiring Community Development Financial Institution (CDFI) which is committed to fostering economic growth, social equity, and sustainable development in underserved communities. As the first such institution in the nation’s capital that is BIPOC-led and -focused, Salaam focuses on partnering with small businesses that anchor historically marginalized communities to provide equitable, non-extractive capital and comprehensive technical assistance.
Supporting Small Businesses
Salaam offers financing to support commercial real estate acquisition, startup costs, equipment, inventory, supplies, and working capital for small businesses and nonprofits. Salaam also offers credit-builder loans to enhance a small business owner’s credit history. All financing products are 0% interest, and structured with risk-sharing at their core, and tie lender and borrower success together in a true partnership. Salaam underwrites all its loan without centering the credit score; character-based criteria are reviewed in conjunction with the credit score. Salaam supplements its financing with financial education, business coaching, and technology assistance to ensure that small businesses receive wraparound services and resources to grow and succeed.
Our Commitment
Through our lived experiences, we deeply understand and appreciate the unique challenges faced by small business owners who are marginalized in the traditional lending and investment markets. Our equitable and inclusive vision welcomes:
- Borrowers whose values prevent them from engaging in interest-bearing loans;
- Small businesses/owners in low- to moderate-income census tracts and CDFI Investment Areas (per 12 CFR 1805.201(b)(3)(ii));
- Minority-Owned Businesses, including Black, Indigenous, and People of Color (BIPOC)-owned and -controlled;
- Women entrepreneurs;
- Newly arrived immigrant and refugee entrepreneurs; and
- Nonprofit organizations located in a CDFI Investment Area or serving needs therein, or serving needs of BIPOC, women, or immigrant and refugee communities.
Target Geographies
Our focus is on providing access to capital to small business owners who are historically and systemically marginalized by policy or practice, wherever they may be located in the United States. These small business owners are often in communities that are the epicenter of a thriving payday lender ecosystem, where predatory loans fill a gap created by traditional lenders that do not have a presence in these communities and/or are unwilling to modify their loan policies and underwriting criteria to align with the histories, needs, and values of the communities in which they are located, employ, and from whom they receive deposits. Such communities may be in regions impacted by climate change, rural and urban areas, and Tribal nations.
Small Business Criteria
Some of our funding criteria includes the following.
- Ethical: Ethical treatment of employees, customers, and vendors; human and non-human neighbors; and land, air, and water
- Socially responsible: Adding to the neighborhood and community’s vitality and growth, and therefore do not directly or indirectly support alcohol, tobacco, gambling, pornography, and weapons manufacture or sale
- Creating job and other opportunities within the community
- <50 employees, <$10M in revenues
- For- or non-profit
Small Business Purpose
- Commercial real estate acquisition
- Startup costs
- Equipment
- Fixtures
- Inventory
- Machinery
- Supplies
- Working capital
Capital Support
Aligned with our values and those of our communities, we structure our capital support non-extractively, and become a growth partner by aligning lender-borrower incentives, sharing risk, and tying the borrower’s and our success together. We have adopted non-extractive, non-oppressive models:
- Cost-Plus Financing (CPF)- asset purchase and resale with an agreed-upon markup.
- Shared Ownership (SO)- co-ownership of assets or equity.
- Investment Partnership (IP)- profit-loss sharing.
We have implemented unique underwriting models that do not rely entirely on credit scores, which the Federal Reserve Bank calls a “weak signal of a borrower’s creditworthiness in underserved markets… [and] for borrowers belonging to various minority groups historically affected by economic discrimination.”
Capital Support Products
- Credit-Builder Loan: $500-$1,000; 6-24 month fixed repayment schedule; 0% interest. Designed to enhance credit history.
- Enterprise Loan: $10,000-$500,000; CPF, SO (for commercial real-estate); flexible terms; 0% interest. Designed to purchase assets or real estate.
- Working Capital Loan: $30,000-$200,000; IP; revenue-based repayments; 0% interest. Designed to meet working capital needs.
- Equity: $150,000-$350,000; Straight equity, with possible options, series A or later, co-invest with at least 2 institutional investors at same terms. For high-growth companies.
Business Advisory Services
- Financial education: Budgeting, credit building, introduction to grant sources, financial management, and documentation (SBCS 2023: Startups of color were more likely than white-owned firms to be denied loans due to a lack of necessary documentation required by lender).
- Business coaching: Coaches to help guide businesses through planning, marketing, hiring, and operations support.
- Technology Assistance: Support in accounting and other back-office online or software tools.
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