DENVER (CBS4) – With new COVID restrictions in place in parts of Colorado, many small businesses will likely need more financial help. One option is the Energize Colorado Gap Fund, which was set up by the state in August.
This week, the first round of checks, totaling $6.7 million, went out to small business owners. Applications for the second round of funding closed on Wednesday, and decisions on who gets money will be made in about five weeks.
The Gap Fund was created to provide more than $25 million in loans and grants to Colorado small businesses that were unable to access other loan programs, such as the Paycheck Protection Program. It prioritizes four populations that historically have a harder time getting capital: women-owned, minority-owned, veteran-owned and rural-based businesses of 25 employees or fewer.
“The great news is in our first round, those four priority groups got 99% of our rewards,” said Kent Thiry, Gap Fund Chair.
Despite working outdoors in the San Luis Valley, Dee Espinoza hasn’t been able to escape the COVID-19 pandemic. Not only has her environmental consulting firm, Espinoza Consulting Services, lost business, but it’s taken on more costs to keep employees safe.
“When it impacts us as business owners, at the same time it impacts our employees, then impacts the people in the community,” Espinoza said. “There’s this ripple effect.”
Espinoza’s husband, Julian, is also in the same boat. She said his mechanic shop, JEAR Collision Center, has lost significant business due to the pandemic as well.
In August, both applied for the Energize Gap Fund with the hope of being awarded a grant to help cover costs.
“We thought we were a good candidate because we’d seen the scoring matrix,” she said. “Being a Hispanic, woman-led, rural business, we were the target audience for the gap fund.”
This week, both Espinozas were among the 547 small businesses owners awarded much needed relief. Dee said she already used part of the funds to pay payroll and hopes other businesses get the help with a second round of funding ahead.
“We did $7 million in this first round and we’re going to do $19 million in this next round because we wanted to work out all of the bugs in the system,” said Thiry.
According to Thiry, some of the fixes included updating the software, improving community outreach, and increasing the amount and quality of languages offered for the application process.
“At the very beginning, our Spanish language version was not as naturally written as it should have been,” Thiry said. “So, it was technically correct, but it wasn’t comfortably correct, so we’ve done a bunch of work on that.”
One thing the team behind the gap fund can’t fix is the demand. In the first round 5,600 people applied for a total of $135 million. In the end, only about one in 10 applicants received funds.
“This is almost a schizophrenic experience because it’s so glorious to be able to give money to some of these businesses and it’s so depressing to say no to other deserving businesses,” Thiry said.
Sisters Brittany Rae and Joslyn Reese are hoping their Aurora-based fitness and nutrition company, Fit and Nu, is considered this time around. The company’s mission is to help women of color create healthy habits, but this year they lost a number of contracts and members due to the pandemic.
“The biggest thing for us is saving our space because we have a brick and mortar, our overhead is high with low membership,” Joslyn said.
“We hope that those who are part of the decision making sees the bigger picture,” Brittney Rae said. “It’s not us just trying to stay afloat for the moment, but for a movement that we’re creating to help women of color survive and thrive beyond COVID.”
Anyone not awarded funds the first time around will automatically be considered for round two.
Of the $25 million available in the fund, $20 million comes from CARES Act dollars. The additional $5 million was raised by Energize Colorado.
“Our challenge is to do well enough with these first couple rounds so we can do sustainable funding and do even more next year and beyond,” Thiry said.