How nonprofit became a lifeline for women business owners

Days after the pandemic forced business and school closings in March 2020, calls started pouring in to WomenVenture from business owners seeking help and advice.

In almost no time, the number of calls — and the intensity of callers' fears and worries — drew the group's top leaders onto phone duty.

"Entrepreneurship is always stressful. You don't understand that pressure until you're a CEO or a business owner," said Sarah Pike, WomenVenture's chief program officer. "All of a sudden, all those stressors were intensified."

For nearly 50 years, the nonprofit organization, backed by corporate and individual donors, has been helping Minnesota women start and expand businesses. Aiming to increase the number of businesses it served by around 10% in 2020, WomenVenture's client outreach grew 300%.

The group disbursed $9.4 million in COVID-19 emergency relief grants and loans to women-owned businesses. And it's been given another $4.4 million in state and county grant money to distribute over the next few months.

In an interview, three of the organization's leaders — LeeAnn Rasachak, its new chief executive and former board member; Sue Moses, vice president of lending; and Pike — described how they saw women business owners respond to the pandemic.

No one was complacent, they said. Business owners looked for new opportunities. And those who couldn't find them took steps to cut costs and survive.

Excerpts from the interview:

Q: Where were things before the pandemic for WomenVenture? Two years ago at this time, what did you see ahead for 2020?

Sarah Pike: We were really poised for growth. We were looking at how to expand our loan program and portfolio, which had always been a long-term goal. We were expanding our programs, adding more classes for the traditional entrepreneur as well as looking at how to increase our whole suite of services for child care. Overall, we were thinking 'We're shooting for 10% growth. This is going to be exciting.'

LeeAnn Rasachak: I recall going through our strategy session as a board member at the beginning of the year, talking about digital delivery. We were discussing digital transformation for the organization, being able to reach our clients wherever they are, whether in the Twin Cities or in rural settings. Not dissimilar from other organizations, the ability WomenVenture showed to quickly pivot from training in classes to all online, while also helping to find funding for these businesses, was incredible.

Sue Moses: I remember the conversations about the pluses and minuses of online training, how important we thought it was to have people in the same room. We wondered if we could be as relevant if everything was online. And then the pandemic happened and, boom, everything was online in three days.

Q: Do you remember the moment at the start of the pandemic that you all realized everything was going to be different?

Moses: I remember I was on vacation and we had a conference call about whether to close the office at the start of March. Suddenly, we realized just where we were. The phones just started ringing. We used to have five calls a day. And suddenly, we were getting 100.

Pike: We had all gone home, taken our monitors just like everybody else. And the calls kept coming in. Just people looking for help. The amount of emotion coming through.

Moses: Very early on, DEED (the Minnesota Department of Employment and Economic Development) got together with us and 20-plus other economic development agencies in the state and I remember being on a call with them at 9 o'clock on a Friday night. Everybody was there at the table. What can we do? We've got to get money out to people. It was all just rush, rush, rush.

Q: What did you hear from your clients at the start?

Pike: Entrepreneurship is always stressful. It's very emotional. You don't understand that pressure until you're a CEO. When the pandemic began, all of a sudden all those stressors were intensified. And you've taken away community and you've taken away resources. That compounded the panic we were hearing. The other piece was this dangle of 'There's money out there that might help me survive. How do I get it?' Meanwhile, the people offering the money were saying, 'How do we get it to people?'

Moses: Our clients are small, small, small businesses. Some are solo proprietors. Some of them don't know what a balance sheet is. That's why we have our training programs.

Rasachak: That's our primary audience, but there's another audience of people that come to us when they are in the position where they want their business to thrive. They've gone from 'I'm going to launch this' to 'It's going well' to 'How do I grow?' For the individuals who are following their passion, we help them to realize that it is a business and here are the different functions that you have to consider. And I think during the pandemic, it shed a light for our clients on how they were really doing.

Moses: I think one of the things that a lot of people struggled with was the idea that 'I didn't do anything wrong.' These were hard-working people — some of them were just starting, some of them were ready for growth. That was hard because they didn't do anything wrong. It just happened.

Q: Besides in the number of people who sought out the organization, how did your programs or services change?

Pike: Suddenly, being virtual, we were drawing from a larger geographic area. Prior to the pandemic, our clients really came from Minneapolis, St. Paul and the suburbs. But we were seeing more people come from Rochester, more from northern Minnesota. We would get the occasional person from New Jersey or Virginia. That kind of growth wasn't intentional, but they were looking for services and we were accessible because we were online.

Rasachak: That digital connection and creating a community is really powerful. When our clients felt alone in their situation, we had a peer network to offer them. That's key to our future.

Moses: Getting money out the door changed a lot. We directed people to the Small Business Administration for the EIDL ( Economic Injury Disaster Loan) program, which was a direct program and not the way the SBA usually operates. We also partnered, along with many other economic development agencies, with DEED to get out about $30 million in small business emergency loans. We were an information source about PPP (the federal government's Paycheck Protection Program) but we opted not to be a funding source. We also were involved with grant programs with the state and Hennepin County.

Q: When did it start to feel less like a crisis?

Rasachak: What's also important to recognize is the racial reckoning that followed not long after the pandemic began. That time (after the police killing of George Floyd) was a multiple-layered trauma. There was a lot of consideration given into our ability to help with small businesses that were damaged or impacted in that time period. In addition, you had staff and employees who are traumatized, or reliving the trauma, and dealing with the reckoning.

Q: What specific challenges did you see that involved people of color?

Pike: Many don't have the support system that could help them answer their questions about business issues. Or they may have trouble accessing capital or understanding the system.

With our 'Accelerating Success' class, we've started a cohort specifically for women of color. Before we launched this, we did focus groups with our clients who are women of color. They told us we need to pause and have a point in our classes where we can hear their stories and understand where their learning gaps are.

Moses: We work with a lot of low-income women and women of color. It might be somebody who says 'I'm good at cutting hair and I want to open my own salon.' Then she wants a loan. So we have a class to show her what it's really like to be a business owner. A lot of people come to our loan group first, and we assess who is ready for a loan or who needs help from someone else in the organization. We ask not just 'Are we going to get our loan paid back?' but 'Is this loan going to help her be successful?'

Q: How has WomenVenture been changed by the experience of the last two years?

Moses: Any organization is its people. We've had to become very flexible. As we do job descriptions now, I look at the bottom and I want to make sure it says "When we say other duties, we mean it."

Pike: There's an air, like with our business owners, of 'Oh, we made it.' It was hard. That rapid growth we had was not maintainable. But the experience showed us how we can grow.

Rasachak: We did not expand our head count. We increased our programming. We increased our client base. We hired people temporarily to help disseminate loans. We can take a minute now to look at the programs we put on pause during the pandemic and start to turn them back on. The urgency of child care existed pre-pandemic. But now more than ever, we have to grow that program.

Q: What gives you hope for small businesses?

Rasachak: Our clients are innovating how they do business through new products and services. Business owners are calling to seek funds to support their growth. In parallel, we are seeing clients retain their staff and offer additional employment opportunities, which directly impacts our local economy. I think these are more than signs of hope, but hope actually realized.