The initiative, named “Fast Break for Small Business,” will use the funds to remove barriers often faced by minorities, women, immigrants and the LGBTQ+ community.
2020 was a year ripe with business formations that eclipsed formations completed in 2019. According to the U.S. Census Bureau, the third quarter of 2020 saw more than 1.5 million new-business applications, an amount nearly double the figure for the same period in 2019.
"Much of this growth is being fueled by people from under-represented communities,” LegalZoom wrote in a statement. “However, these individuals often have a harder time accessing the resources they need to succeed.”
The company cited surveys from McKinsey & Co. and Fundera that showed Black and Hispanic-owned businesses are two times as likely to be considered “at risk” by banks, while women receive a small fraction of small business loans each year.
“Our commitment to promote social equality and economic inclusion align perfectly with the values of the NBA, WNBA and NBA G League,” Dan Wernikoff, LegalZoom’s chief executive, said in a statement. “The ‘Fast Break for Small Business’ program accelerates our ability to support both new and existing small businesses while reducing the endemic inequalities in the financial and legal systems.”
NBA Commissioner Adam Silver added that the partnership with LegalZoom “will bring meaningful resources to entrepreneurs and directly address many of the challenges facing minority-owned small businesses.”
Shares of LegalZoom closed up $1.79, or 7.44 percent, to $25.86 on the Nasdaq Thursday, a day when the market closed up more than 1.5 percent.