Starbucks Supports Community Development Financial Institution to Create U.S. Jobs
(3BL Media and Just Means )- Think back to 2011. The worst of the recession in the US is over (for some.)Â Â It's been a few years, but you can now afford to get back to your regular patronizing of your local Starbucks.Â As you order your morning caffeine the barista asks if you'd like to help Starbucks create more USA-based jobs. She hands you a red, white and blue wristband with a zinc plate inscribed with the word 'Indivisible.' The barista tells you that the bracelets are made in the USA and from 100% USA-manufactured materials. 'They are part of Starbucks efforts to put Americans back to work,' she says, as she hands you your Guatemalan grown, Mexican roasted coffee.Â Â So, what exactly did Starbucks do with the profits of those wristbands? Did they really have the creativity and leverage to put Americans back to work?
The campaign, "Create Jobs for USA," claims to have 'helped more than 5,000 Americans keep their jobs or get back to work.'Â Â Starbucks used the power of their brand and their household recognition to create funding mechanisms for the Opportunity Finance Network (OFN), the leading national network of community development financial institutions (CDFIs). CDFIs are typically smaller, private financial institutions that provide lending to small businesses, non-profits and individuals who may have limited access to affordable lending opportunities. The Create Jobs for USA Fund awarded capital grants to OFN-screened CDFIs that in turn, used these monies as an asset, leveraging them for bigger loans from traditional banks or investors. Simply put, the money raised by Create Jobs for the USA campaign served as credit or debt leverage.
Starbucks helped to pave a way towards financial stability and growth for people and companies with limited access.Â The campaign raised $15.2 million dollars for 120 CDFIs with $1 million came from the sales of the wristbands and other 'Indivisible' products. Â So how does this money equate to job creation? According to a report released this month, the OFN conducted in-depth research on how much financing by CDFIs and other community lenders is required to create and retain a full-time equivalent (FTE) job. They estimated that one full-time job required $21,000 in CDFI financing to community business.
Starbucks issued a report last week about the Create Jobs for USA Campaign, highlighting six key lessons learned when implementing a CSR program:
1. Strong corporate leadership can translate into remarkable success for nonprofit initiatives.
2. Effective corporate-nonprofit partnerships create significant impact, visibility, and momentum.
3. The power of branding cannot be overstated.
4. Measurable performance and impact are essential.
5. Borrower stories are perhaps the best way to demonstrate impact and attract media attention.
6. Americans, when given the opportunity to do so, will help create opportunity for others.
Some have criticized Starbucks, claiming that Create Jobs for USA Campaign is simply a marketing ploy. Supporters of the campaign have replied that even so it creates US-based jobs and continues to raise money for CDFIs. Â
For more information about Create Jobs for USA Campaign and to read their recently published report on the campaign, read here.