CEEM Builds Inland Black Business
By Dianne Anderson
Some people think that raising $15 million for the sole purpose of sustaining Black business and supporting community would take nothing short of a miracle, when, in actuality, all it takes is $100 per person.
For those who get on board, there’s the added benefit of cash back rewards.
It’s all part of a vision of growing a business empire, a wealth building strategy that Kyle Webb and the rest of his family knows a little something about.
His dad, Reggie, once one of a handful of Black McDonald’s owners across the nation, within a relatively short period of time turned the small business into the thriving family franchise with 16 Los Angeles and Inland Empire locations.
Webb, CFO of the Inland Empire-based Webb Family Enterprises, attributes the family’s entrepreneurial success to giving back to the community. It’s also the philosophy behind his new cooperative that is calling Black people to become part of a bigger movement.
“Our cause is about increasing incidence of entrepreneurship in the Black community,” said Webb, co-founder and CEO of the nonprofit Cooperative Economic Empowerment Movement (CEEM).
In some ways, he said CEEM resembles a crowdfund similar to the Black Wall Street economic approach with funders coming together to buy businesses and pay out dividends. But, as far as he knows, CEEM’s co-op model of acquiring businesses for the financial benefit of the Black community is unique.
In time, the model could also increase local youth employment. Currently, he said it costs about $148,500 a year to incarcerate youth in the criminal justice system. Young Black men still grapple with three times the rate of joblessness as their white peers. As more Black businesses grow, it should have an exponential positive impact.
CEEM hopes to capture a portion of Inland Empire’s 330,000 African Americans into the cooperative that is seemingly a cross between Recycling Black Dollars, and membership-based warehouse stores.
Membership dollars would be pooled to buy a business, whatever is deemed a workable, profitable venture, that could eventually be purchased by the operator through a compensation package.
Any number of businesses could work well under the model, he said. It could be a dry cleaner, or a gas station, that could grow into several locations.
“African Americans drive about 100,000 cars every day, and none of us own a gas station,” he said.
The $100 one-time membership fee is for both individuals and businesses. The recurring annual membership fee is $25 for individuals, and $100 for businesses.
All membership dollars go into the fund, enabling CEEM to buy more businesses supported by the Black community, and everyone else, with membership receiving occasional dividend checks, like cash back for being a partner.
“You will accrue a financial benefit, essentially a refund of profit that is proportionate to the amount of money that you spend in the businesses,” Webb said.
If CEEM gets 150,000 members of Black businesses and individuals at $100 initial fee, it would provide $15 million investable capital base, he said.
CEEM members, along with the general broader community, would then purchase services at that business, but members would receive their refund proportionate to the money they spend.
Despite pockets of poverty in the Inland Empire, he said Riverside County holds a higher household median income for African Americans than Los Angeles County. In fact, it is above the national median income.
The decision on the type of business depends on CEEM membership rolls. The goal is to invest in the size, scale and scope of business that our membership base allows, he said.
“Right now, we’re still early in the process, but it is our goal to invest in the first business in the first quarter of 2019, assuming we are able to develop the membership base,” he said.
He said if the first business happens to be less capital intensive, then they might invest in things that are less expensive, like a cleaner.
Everyone can join in, and everyone can profit. There will be workshops and business building events in conjunction with local partners.
Their recent LA County Fair African American initiative had a great showing from banks and nonprofits, and he said is also eager to work with local nonprofits and business organizations. CEEM wants to support existing structures and member organizations to augment services they may be providing.
“We want to help more Black businesses come in contact with someone like the Black chamber, so those services can be utilized in a much more organized and useful fashion by more of us. We want to point people in the right direction,” he said.
With $1.3 trillion in spending power in the African American community across the nation, he said that the community should be able to accrue benefits over double that for the entire community.
“Right now, we don’t accrue half of it,” he said.