SaverLife Is Helping Entrepreneurs Grow Their Small Businesses Through Savings
Entrepreneurship is a crucial pathway for economic and social mobility, but it can be fraught with financial risk. The challenges facing entrepreneurs of color are even more significant. SaverLife has discovered that 88% of our members who identify as small business owners are actually sole proprietors or micro-businesses, with one or fewer employees. In our research, 68% of self-employed members shared that their personal and business expenses are highly intertwined. This interconnectivity was magnified for members who shut down their business at some point in 2020 due to COVID-19. For those members, 67% had to reduce their own salary, 62% had to loan money to their business, and 67% said they had to borrow money from their business (an 81% increase from pre-pandemic). More than 70% of self-employed SaverLife members reported lower incomes due to the pandemic.
Our impact on the savings of low-to-moderate income people of color is clear: more than 60% of SaverLife members are people of color, and on average, our members increase their savings rate by 4.8x. Because of the direct correlation between personal and business finances for entrepreneurs, building their savings with SaverLife could directly correlate with the growth of their small business or side hustle.
With the support of Wells Fargo, SaverLife is launching a campaign to engage early-stage entrepreneurs, particularly low-to-moderate income individuals and people of color, with a series of savings challenges and small business savings content to educate and inspire micro-entrepreneurs to make their visions a reality. Through extensive research, SaverLife will better understand the full story of these individuals and the challenges they face when ramping up their businesses.
Our goal is to help participants shore up their personal finances and help build savings to start or grow their businesses. We will also share key recommendations regarding challenges facing entrepreneurs and opportunities to improve small business success and share those with policymakers and leaders.
Small Business Challenge
SaverLife’s Small Business Challenge includes $100,000 in cash prizes to help entrepreneurs grow their small businesses. Over the next three months, participants can enter savings challenges to be eligible to win three grand prizes of $5,000 each and 28 $250 prizes every week.
Additionally, entrepreneurs will receive a $25 enrollment bonus for signing up for SaverLife and taking charge of their savings in the Small Business Challenge.
Small Business Resources
SaverLife offers a one-stop guide to help micro-entrepreneurs successfully plan for—and save up funds in order to scale—their small business ideas. The guide includes a new small business content series with articles from SaverLife’s expert financial coaches. The three-month series will cover topics such as: how much to save to start a business, the importance of business emergency funds, how to create a business financial plan, and how to fund a small business. The guide also shares Small Business Administration resources, including small business courses and a small business checklist.
Research
Approximately 1,000 entrepreneurs will participate in research surveys to better understand the full story of these individuals at the earliest stages of entrepreneurship, as we know their personal and business finances are so closely tied together. Through this research, we will better understand the challenges entrepreneurs living with low incomes face, and we will propose recommendations that will enable them to accelerate their dream. SaverLife is proud to launch this campaign and excited to help small business owners achieve their dream.
