How JPMorgan Chase Is Expanding Who’s at the Table
When leading companies commit to equity and inclusion, it fuels business growth at every level.
To succeed, every business needs a big idea. That’s not a problem for the hundreds of thousands of diverse-owned businesses in the U.S.—including enterprises run by people of color, women and veterans. What many of these businesses lack is opportunity.
JPMorgan Chase’s support for diverse-owned businesses is strong and continues to grow. Programs such as Advancing Black Pathways, Women on the Move and Small Business Forward have helped diverse-owned businesses strengthen their foundations and accelerate growth. The firm’s Path Forward program takes a holistic approach to addressing this lack of opportunity. The initiative commits $30 billion to advance racial equity, including significant investments in diverse-owned businesses.
“We have to have a level of intentionality,” says Fred Royall, Managing Director and National Head of Diverse Businesses at JPMorgan Chase. “When you have a best-in-class commercial bank and are intentional about resources for specific groups, that’s a really powerful combination.”
Fred Royall, Managing Director and National Head of Diverse Businesses
To support the firm’s $30 billion pledge, JPMorgan Chase Commercial Banking is focusing on four themes for diverse businesses in 2021:
- Connecting diverse suppliers with opportunities
- Increasing access to capital
- Helping businesses scale for growth
- Helping businesses navigate current economic challenges
Connecting Suppliers With Opportunities
The opportunities for diverse-owned businesses to contract with Fortune 500 companies are big—and growing. As a member of the Billion Dollar Roundtable, a group of 28 Fortune 500 companies that spend at least $1 billion annually with diverse-owned suppliers, JPMorgan Chase currently spends about $3 billion sourcing from businesses. Over the next five years, JPMorgan Chase plans to increase its spending with Black- and Latinx-owned businesses by an additional $750 million per year.
Additionally, JPMorgan Chase has a Supplier Diversity Network that finds and nurtures business relationships with diverse-owned suppliers. The network also supports diverse-owned supplier growth by helping historically underrepresented entrepreneurs gain skills and broaden their networks.
“We’re expanding who’s in the room,” says Terry Hill, Managing Director and Industry Manager for Middle Market Banking at JPMorgan Chase. “Whether it’s our firm sourcing or our corporate partners, there’s knowledge that’s necessary to be a partner of a Fortune 500 company. If we can bring diverse-owned businesses into that room, they’re going to gain knowledge and have opportunities they might not have had.”
JPMorgan Chase Commercial Banking has also found new ways to share knowledge across the business community. In February 2021, we kicked off a national speaker series for diverse-owned businesses that features Fortune 500 companies talking about how suppliers can gain an edge and access these valuable opportunities.
Committing to Capital
“Historically, many diverse businesses have grown organically,” says Thelma Ferguson, Managing Director and Northeast Segment Head for Middle Market Banking at JPMorgan Chase. She points out that many diverse businesses are uncomfortable with conversations around capital. For these folks, there’s a trust factor that’s hard to overcome.
That’s why a relationship with JPMorgan Chase can be so valuable for diverse-owned businesses. “One of the first things we can do is help businesses think about their capital structure,” Royall says. “How might they think about financing their business going forward? What are the potential sources of capital available?”
When diverse-owned businesses have a deeper understanding of how capital works, JPMorgan Chase can help them get the most out of it—either as a lender or a connection point to capital sources that fit their specific needs.
“For us, it’s ultimately about servicing our clients to the best of our abilities to help them grow and evolve throughout the trajectory of their life cycle,” Ferguson says.
Entrepreneurs who didn’t go to business school or don’t have business connections often are not sure what it takes to reach the next stage of growth. Paradoxically, businesses at the lower end of the middle market are often in the best position to grow.
Hill likes to say that this is the stage “where complexity begins to show itself.” Tools, advice and connectivity help tame that complexity, he adds. With our scale and experience, JPMorgan Chase is an ideal partner for many diverse-owned businesses.
“Our job is to help them understand what’s possible—from a growth perspective, from a capital-raising perspective, from a technology perspective—and combine it with their business ideas and inspiration,” Hill says.
For Ferguson, the key is mentorship. “We want our clients to take the baton and pass it back to someone on the smaller end and show them the art of the possible,” she says. “Those companies have been there and can help train them up.”
Building Resiliency Beyond COVID-19
The pandemic has exposed inequities throughout the business sector. A disproportionate number of women have closed businesses or left their jobs to care for family members, and many diverse businesses have shuttered because they lacked the necessary capital to weather the storm and pivot to new opportunities.
The size of JPMorgan Chase and the depth of expertise of our people put us in a unique position to help diverse-owned businesses build resiliency so that they can manage through future crises.
“We’re leading from the front,” Ferguson says. “Connecting the dots internally and externally, partnering with others and placing challenges out there to everyone else. We’re rolling up our sleeves to help, and we’re not alone.”