An initiative that brings crowdfunded loans to entrepreneurs struggling to find capital they need to start or expand their small businesses was announced by Mayor Cory A. Booker. Through Kiva City Newark, anyone who believes in small business growth and local job creation can lend $25 to an entrepreneur of their choice on the Kiva crowdfunding platform. This project is a partnership between Kiva, The Intersect Fund, Rita Allen Foundation and other local groups advancing community revitalization through entrepreneurship.
“Kiva City Newark gives everyone a chance to help support local jobs and businesses,” said Mayor Cory A. Booker. “When you help to crowdfund a loan to a small business you are creating jobs in local communities, which in turn supports another local business, and another. As small businesses grow and expand, local economies improve, helping to support schools, city services and more vibrant and sustainable communities.”
Crowdfunded loans will fill a critical lending gap faced by entrepreneurs whose businesses are too young, too small or too innovative to receive loans from traditional lenders. Small businesses create two-thirds of all new jobs and if just one in three small businesses could hire one more person, the U.S. would be at full employment.
“Kiva City Newark offers an opportunity to connect Intersect Fund borrowers with people all over the world,” said Rohan Mathew, president and CEO of The Intersect Fund, which opened its Newark headquarters at 59 Lincoln Park today. “The Intersect Fund is proud to invest in the entrepreneurial spirit that already exists in Newark’s thriving business community.”
Visitors can browse entrepreneurs’ profiles and stories and choose one to support with a loan of $25 or more. Every dollar lent to an entrepreneur in New Jersey will be matched by the Rita Allen Foundation, up to a total of $50,000.
“Crowdfunding small business loans gives each of us a chance to support thriving local economies, communities and jobs,” said Premal Shah, President of Kiva. “If the money stored in our wallets was given a new life for a short amount of time, as a loan to a small business owner, each of us could help to shape the course and success of the economy. A single loan, a single business or a single job can help change the trajectory of families, communities, and cities.”
Kiva is the world’s first and largest crowdfunding platform for social good with 950,000 people crowdfunding 1 million entrepreneurs in 65 countries. Newark joins similar Kiva initiatives in Los Angeles, Detroit, New Orleans, Washington, D.C. This is the largest Kiva City launch to date, with 30 businesses raising more than $150,000 on launch day.
The Intersect Fund is the leading microlender in New Jersey, providing financing to more than 300 businesses in low-income New Jersey communities over the last two years in amounts ranging from $300 to $25,0000. Through this partnership, The Intersect Fund will post more than 100 business loans on Kiva over the next year, allowing the Fund to raise much-needed capital to deploy to budding entrepreneurs.
Several other area organizations are joining Kiva City Newark as Trustees on Kiva Zip. Kiva Zip is a new program of Kiva that allows individuals and organizations to become Trustees and publicly vouch for entrepreneurs that they know and trust in their community. Trustees in the Newark area include the Greater Newark Enterprises Corporation, Institute for Entrepreneurial Leadership, Rising Tide Capital, and Jalima & Associates.
Once endorsed by a Trustee, borrowers can post their loan request at zip.kiva.org and begin getting their loan crowdfunded by friends, community members and Kiva’s growing global community of 950,000 lenders. When the entrepreneur successfully pays back, they too can become a Trustee on Kiva Zip and “pay it forward” by endorsing other small business entrepreneurs in their trust network.
“Kiva City Newark is made possible by a generous donation from the Rita Allen Foundation,” said Shah. “Their support of transformative ideas and breakthrough solutions is building stronger communities throughout New Jersey.”