Posted by: LISC Small Business on June 13, 2016
In Cincinnati, two hardworking entrepreneurs can now cross off “secure financing” from their long “to-do” lists. Jasmine Ford of Jazzy Sweeties, a bakery, and Kristen Bailey of Sweets & Meats BBQ, a caterer and food truck, both received financing through Kiva.
Kiva is not your traditional financing source; instead, it is an online platform entrepreneurs use to crowdfund 0% interest loans up to $10,000. Kiva loans are also character-based, making them a great option for small businesses who might not qualify for a traditional bank loan. Instead of evaluating borrowers on financial underwriting standards like credit score, cash flow, or collateral, Kiva looks at borrowers’ character and standing in the community.
Ford and Bailey heard about Kiva after completing a nine-week training program through MORTAR, a LISC Greater Cincinnati partner that equips under-served entrepreneurs in the Over-the-Rhine and Walnut Hills neighborhoods with the resources and tools they need to start and expand their businesses. “MORTAR plays a crucial role in our Place Matters neighborhoods connecting low-income residents to economic opportunities within their communities,” said LISC Greater Cincinnati Executive Director Kathy Schwab. MORTAR endorsed both Ford and Bailey for Kiva loans, vouching for their businesses and helping them access capital.
Jasmine Ford used Kiva to raise $10,000 for her bakery, Jazzy Sweeties. For two years, Ford operated a licensed bakery out of her home, making cakes, cookies, and parfaits. As word spread throughout the neighborhood about Jazzy Sweeties’ creations, Ford needed a new space dedicated to the business. Jazzy Sweeties now has a storefront and will soon hold its grand opening in the Walnut Hills neighborhood, where Ford hopes to become the community’s go-to bakery. The Kiva loan will help her buy a commercial oven and refrigerated display case for the new space.
As a young entrepreneur at just 23 years old, Ford saw Kiva as an innovative way to get financing. She was able to prove her creditworthiness to Kiva by having people within her own community – friends, family, and customers – vouch for her business and character with loans of $25 or more. After getting initial lenders from her own network, Ford’s loan then became visible on the Kiva website, where individuals from around the world could lend to her business. More than 100 people supported Ford’s loan, including a few lenders in Europe.
“It was really amazing to have people all over the world support my business who have never met me,” Ford said. “I truly appreciate each and every person that became a lender. It really motivates me now more than ever because it’s not just people in my own city watching my business.”
As a startup, Sweets & Meats BBQ also turned to Kiva for financing, since most banks require businesses have two or more years in operation. Business owner Kristen Bailey used the $10,000 loan to purchase a professional trailer wrap for Sweets & Meats’ food truck and insulated food transporters for catering orders. Both purchases will help Bailey to meet the rising demand for Sweets & Meats’ delicious food, which has been nominated twice for “Best of Cincinnati” awards in the barbeque category. The new trailer wrap allows Sweets & Meats to attend more food truck events, since displaying its business logo and contact information is a requirement with the county board of health.
The trailer wrap has already started to generate additional business. Bailey explained, “When we are en route to jobs, people are calling because they see and recognize our trailer, wanting to know where we’re going.”
For Bailey, the support from Kiva lenders was encouraging. “Being in business for yourself is hard,” she said. “To experience the outpour of love from friends who saw our campaign to complete strangers helped us gain confidence in our business. Kiva has provided us with a sense of community that we haven’t been able to cultivate elsewhere.”
To help Jasmine Ford and Kristen Bailey meet their Kiva goals, LISC Small Business matched loans to their businesses dollar-for-dollar. Since May of 2015, LISC Small Business has supported 47 U.S. businesses that have successfully funded on Kiva across 10 LISC cities. Kiva offers entrepreneurs in LISC neighborhoods another financing option, especially for those who need small loan amounts, are just starting a business, or have some credit issues. “LISC’s partnership with Kiva brings impact to our neighborhoods’ commercial corridors and also to our broader efforts with neighborhood economics – providing nontraditional entrepreneurs access to capital,” Schwab explained.
Although crowdfunding on Kiva is a challenge that requires daily outreach and campaigning, both Jasmine and Kristen would do it again.
“I would recommend Kiva to entrepreneurs, and not just for the loan it provides,” said Jasmine. “Kiva is a great way to show how serious you are about your business and gives you the chance to engage with people and market your business.”
Kristen agreed. “Kiva was very easy to use, we had local support from our trustee MORTAR and a Kiva Small Business Advisor, Mindy McGregor, and the LISC match was second to none. We essentially had a team of people working with and for our business and it was incredible!”
To learn more about Kiva, make a loan, or become a borrower, visit www.kiva.org. Interested in learning more about Kiva in Cincinnati? Reach out to Mindy McGregor, the local Kiva Small Business Advisor. Interested in learning more about LISC Small Business and Kiva’s partnership? Reach out to Maddy Woodle.
Top photo: Business owner Jasmine Ford of Jazzy Sweeties. Photo by Phil Armstrong.