Unless you’re to the manor born, the biggest challenge your small business can face is access to capital. Seed money, dough to grow, pump-priming startup funds.
Banks typically don’t like to fund entrepreneurs needing less than $50,000. No one should ever use a credit card or personal line of credit.
To make muddy waters murkier, getting funding from a traditional financial institution is tougher for minorities than other business owners due to issues like insufficient credit, limited banking history, and unconscious bias.
But sometimes when one traditional funding door slams, a wider one opens.
Umpqua + Kiva Partner to Fund 0% Loans to Underserved Entrepreneurs
Crowdfunding can powerfully democratize access to capital because it depends on small amounts of capital from a large number of individuals.
Umpqua Bank has officially activated a $1 million managed loan fund with Kiva.org, a nonprofit crowdfunding platform for historically underserved entrepreneurs.
Through Kiva’s platform, Umpqua is providing eligible women and Black, Indigenous, and people of color with no-interest loans up to $15,000 to finance their emerging businesses.
Qualifying business owners in Washington (and Oregon, California, and Idaho with more states to roll out soon) will receive a triple match from Umpqua for every dollar crowdfunded for their business through Kiva.
I’ll hit you over the head with that last part again: qualifying businesses will receive a triple match from Umpqua for every dollar raised for their business from family, friends, and supporters in their communities.
A statement from Umpqua on the Kiva application page: At Umpqua Bank, we believe we share in the responsibility to make our communities strong, resilient, inclusive, and economically vibrant. We’ve contributed $1 million to Kiva to amplify the power of your loans. Loans you make to a woman or BIPOC entrepreneur within the communities we do business will be multiplied, helping speed a recipient’s success in obtaining innovative, affordable funding.
What makes this unique?
- That triple match 0% goodness, all just waiting to help grow BIPOC and women-led small-business dreams into thriving big-deal realities
- Immediate Access to Capital: The ability to access loans quickly – participating small businesses do not have to go through lengthy approvals to jump-start their business initiatives. Support from their communities is all you need to secure a legitimate source of capital that would otherwise not be available.
- A Growing Program: The $1 million will replenish as loans are paid back – this enables the fund to finance programs on an ongoing basis.
How Kiva works
Kiva is fantastic for folks who need a little funding, not a massive loan from a big bank. For any business owner in need of funding to start, sustain or grow, the only collateral needed to access capital through Kiva is the support of the people and community they serve. Typical barriers to access are removed from consideration, including those related to credit history, physical assets for collateral, citizenship, or verifiable financial track record. We love Grant’s story out of Shelton, WA. He’s a regenerative farmer who utilized Kiva loans to open a farm store, ultimately providing a greater variety of healthy foods to his local community.
Kiva works hand-in-hand with entrepreneurs to set a financing goal of up to $15,000 and raise contributions from friends, family, and community members on its platform. Kiva also offers access to a global network of lenders interested in supporting businesses. Financial commitments raised are then combined into a 0% interest business loan eventually repaid to supporters over three to five years.
How to Apply
Right here. The initial application process typically takes between 20 and 30 minutes.
What if I don’t qualify?
There are hundreds of local businesses, entrepreneurs, farmers, investors, and citizens who are all committed to buying, producing locally and they’re not all on Kiva. Check out some more local investment networks.
From just north of Lake Union where I’ll be watching for you on Kiva,