Innovative Financing Package Helps Veteran-Owned Start Up
Honor Capital was founded in 2014 by a group of post-9/11 veterans with a dual mission of supporting veteran entrepreneurship and improving access to healthy food in underserved communities. Over the past three years, they have been successfully opening grocery stores under the Save-A-Lot banner, creating jobs and economic growth in distressed urban and rural communities.
By the end of 2017, Honor Capital will double in size thanks to an innovative multi-million-dollar financing package provided by a partnership of three Community Development Financial Institutions (CDFIs). Enterprise, IFF and Reinvestment Fund are collaborating to finance their expansion, providing critical growth capital that will also allow them to expand their impact. Thanks to this financing, the company will soon be operating in six states.
- By the end of the year, Honor Capital will operate 10 grocery stores.
- Stores will be in Georgia, Kansas, North Carolina, Oklahoma, South Carolina and Virginia.
- Each store eliminates a “food desert”— an area that lacks access to fresh, affordable foods.
- 40,000 low-income households will have new options for affordable, healthy food close to home
- More than 270 permanent jobs will be created.
The financing package includes both CDFI loans and New Markets Tax Credits (NMTC), which stimulate investment in low-income communities. Enterprise and JPMorgan Chase are providing $8.8 million in NMTC allocations for the project. Chase is also serving as the tax credit investor in the project. Reinvestment Fund, Enterprise Community Loan Fund (Loan Fund) and IFF are providing $5.9 million in leverage loans to support the transaction.
Enterprise shares Honor Capital’s vision for entrepreneurship, economic growth and health. Last year, Loan Fund invested $500,000 to support their growth and provided a $844,000 loan for their fourth store in Wichita, Kansas. We are excited to continue supporting such great partners who are truly making a difference in the lives of others.
“As recently as two years ago, we could not access the capital we needed to start our business and open our first store—conventional lenders wouldn’t even return our calls. Fortunately, we ran into community development financial institutions, who saw the tremendous community impact each one of our stores can have. They believed in our model and were willing to work with us to finance our stores. Now we’re doing a multi-million-dollar deal with three CDFIs.” – Marcus Scarborough, vice president for community engagement and marketing at Honor Capital.