Starbucks Coffee Co. has raised more than $2 million in small-dollar donations from its customers since Nov. 1 in support of its effort to stimulate job growth in low- and moderate-income communities.
The retail giant created a loan fund in partnership with community development financial institutions to make loans to small businesses. Starbucks seeded the fund with $5 million from its foundation and has been urging customers to add to the fund with donations of as little as $5 at checkout or online.
Including Starbucks' contribution, the Create Jobs for USA fund had raised more than $7 million as of Dec. 31 and had made 278 loans in 31 states, Starbucks' Chief Executive Howard Schultz said in a letter to Treasury Secretary Timothy Geithner Thursday. By its calculation, the loan fund has helped to create or retain more than 2,300 jobs, many in distressed communities.
Every dollar Starbucks collects is distributed to lenders through the Opportunity Finance network, a Philadelphia-based organization that represents community development financial institutions. Opportunity Finance Network has said that every $5 raised will be leveraged into roughly $35 of new loans.
Schultz said in the letter that Starbucks expects to introduce more corporate partners over the next couple months as it aims to grow the fund to a point where it will have made loans in all 50 states by the end of this year. He also asked for Geithner's help in identifying more partners so that more CDFIs could participate in the program.
"Starbucks, along with Opportunity Finance Network, has pioneered a way to bring our unique assets to the table and direct resources to programs that are working," Schultz wrote. "We are just getting started, and want to enlist your support and ideas to take this even further."
To date 63 CDFIs have received funds from Starbucks' fund and Schultz said the goal is to increase that number to more than 100 by the spring.