Yesterday, JPMorgan Chase chairman and CEO Jamie Dimon joined Governor Rick Snyder and Detroit Mayor Mike Duggan to announce the global financial services firm plans to invest $100 million in Detroit over the next five years—including some funding for local startup initiatives.
Critics immediately pointed out that $100 million is a drop in the bucket compared with the $13 billion that JPMorgan Chase was fined by the U.S. Department of Justice for misleading investors over the mortgage-backed securities mess that sparked the 2008 recession. Detroit was one of the cities hardest hit by the resulting foreclosure crisis.
However, what’s indisputable is that Detroit can use all the help it can get, and the Chase grants will pour $25 million into blight removal and home loans, $12.5 million into job training, $7.7 million into small business loans, and $5.5 million toward the construction of the M1 rail line along Woodward Avenue. Invest Detroit and Capital Impact Partners will receive $50 million toward development projects.
Local entrepreneurs will get some help from a small slice of the $7.7 million pot for small businesses, which will go to startup incubators TechTown and Bizdom.
TechTown, which is located just north of Wayne State University’s campus, will receive a one-year, $180,000 grant. The grant will support its Blocks Retail Boot Camp and the expansion of the SWOT City neighborhood revitalization program to Detroit’s historic University District.
Leslie Smith, TechTown’s executive director, says the way the folks from Chase coordinated with people on the ground in Detroit already doing community-building work has been “extraordinary.” She’s also confident that the grant announced yesterday will be the just the beginning of a five-year engagement with Chase, which will include additional financial support later on.
“[JPMorgan Chase] saw the funding we got from the New Economy Initiative, the Fisher Endowment Fund, and others, and they said, ‘We want to help you enhance that work,’” Smith says. “Instead of creating something new, they came in and thoughtfully identified partners where they could double down on the work already being done. They saw what’s working, what aligned with their goals, and added their capital, and we’re really grateful for that.”
Bizdom, the incubator backed by Quicken Loans’ Dan Gilbert, declined to specify the amount of its grant, but says the money will go toward supporting and enhancing operations, as well as a new Powered By Chase program that offers paid entrepreneurial internships with Detroit tech startups.
“JPMorgan Chase’s generous commitment to Bizdom will further strengthen the rich environment that is helping technology startups and ecommerce businesses launch, fund, and grow their businesses in downtown Detroit,” said Ross Sanders, Bizdom’s executive director, in an email. “We are hopeful that the commitment will inspire additional local and national leaders to provide support for the Detroit startup community.”
