Skip to main content
All Posts By

Matt

By Borrower Stories

How One Detroit Credit Union is Giving its Members a Second Chance 

Catherine Dorsey had always dreamed of becoming a nurse. In 2016, the Detroit resident took a step closer to fulfilling her dream by beginning medical school in Ohio. And while she worked through the demanding courses, another difficulty materialized: her rapidly accumulating bills. 

In order to pay for her medical school loans, car loans, and other miscellaneous expenses, Catherine was forced to borrow on her credit cards. To make matters even worse, Catherine had taken out those loans from a predatory lender. 

“The first loan that I got actually wasn’t enough for me to do everything I needed to do. So then I had another one just to get enough money to move and get to school. I wasn’t thinking about rates and terms. I was just thinking that I needed money fast. I have to get gas. I have to get food. I have to get to work.” 

The One Detroit Credit Union employees that helped Catherine Dorsey and Sandy Waldrip.

Catherine’s expertise was in people’s wellbeing, not in finance. It wasn’t until the bills started coming in that she noticed something was wrong. On a day off, she sat down and calculated the numbers. She realized quickly that the numbers were high. Very high. One the first loan of $4,000, Catherine would be paying almost $12,000. On the second loan of $3000, she would be paying $10,000: A $22,000 total from a loan of just $7000. 

Fortunately, Catherine had been a One Detroit Credit Union member since 2017. One Detroit Credit Union is a Detroit-based low-income designated credit union that has been serving the local community since 1935. One Detroit is a certified Community Development Financial Institution (CDFI) and Minority-Depository Institution (MDI). CNote partners with credit unions like One Detroit across the country through its Impact Cash™ Solution, empowering individuals like Catherine who are looking to lead healthier financial lives. 

When Catherine walked into the door of One Detroit Credit Union in 2021 looking for help making payments on her predatory loans, she saw a brochure on the teller’s desk for a credit building loan. The teller informed her that the program was a way for individuals to borrow money using their own savings as collateral to help improve credit scores and build credit history. 

Sarneisa Whigham, the Branch Manager at One Detroit Credit Union who assisted Catherine Dorsey and Sandy Waldrip.

Catherine had many questions, all of which the teller answered thoroughly and patiently. Eventually, she recommended that Catherine speak with a branch manager for a full rundown on all the products and services that One Detroit offered that might help her. 

When the branch manager reviewed Catherine’s case, She was shocked. “Has anybody ever talked to you about consolidating your debt?” She asked. No one ever had. So the branch manager explained how One Detroit could potentially help her save thousands of dollars over the life of her loan. It seemed too good to be true. At the end of their meeting Catherine filled out several forms and was told that they would be in touch.

The call came just a few days later, and she had been approved. Catherine went from paying nearly $1000 a month to $320. “I was crying. I couldn’t believe it. I kept asking- are you sure? Are you sure?” 

Prior to the loan consolidation, all Catherine was able to do was work to pay the bills. After One Detroit stepped in, Catherine started saving and making purchases that she had been holding off on for years. 

Sarneisa Whigham, Branch Manager, and Hank Hubbard, President and CEO of One Detroit Credit Union

A Second Chance

One Detroit Credit Union’s field of membership is the entire city of Detroit. In order to be responsive to the needs of all those potential members, the credit union begins with the problems that members most commonly face and then designs the products or services which will alleviate those problems. 

For Sandy Waldrip, a lifelong Detroit resident and healthcare administrator, this philosophy ended up having a profound impact on her life. In 2018, Sandy lost her job due to an organizational restructuring and went from a six-figure salary to pulling unemployment. To make matters even more challenging, her mother got sick, and Sandy had to help take care of her for over a year. Payments fell behind, and Sandy’s credit score took a serious hit. 

When Sandy was able to start looking for another job, she knew that she would need a new and reliable car. Her search was complicated, however, by soaring interest rates on all makes and models due to her lowered credit score. When she finally selected a car, it was the dealer himself who recommended that Sandy go to One Detroit, as he had heard they had a strong refinancing program. 

Initially, Sandy applied for a consolidation loan. She was approved in a matter of days, and One Detroit suggested that she apply to Refi My Ride, their auto loan refinancing program. The program refinances auto loans at half of whatever interest rate the member is currently paying (sometimes over 20%) with the same term. For Sandy, that meant savings of $115 a month or $9000 over the life of her loan. 

And while Sandy is grateful for her new car and the reduced rate she received, she is most appreciative that One Detroit Credit Union took the time to look at her whole story. 

“People don’t understand that life happens. And while you would like to have perfect credit, sometimes things turn around and it just can’t happen. And I understand, some banks or credit unions won’t want to invest in you. But I appreciate the fact that One Detroit looked beyond just my credit score and gave me that second chance.” 

Learn More:

  • One Detroit Credit Union is a Detroit-based low-income designated credit union that has been serving the local community since 1935. One Detroit is a certified Community Development Financial Institution (CDFI) and Minority-Depository Institution (MDI)
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

How Chicago Community Loan Fund Is Filling Lending Gaps To Grow Wealth

When Wendell Harris found himself out of a job in 2013, he wasn’t exactly sure where he was going to land within the world of banking and real estate. Fortunately, Robert Rose, one of Wendell’s former bosses, heard that he wasn’t working. At the time, Robert was in a leadership role at Chicago Community Loan Fund, a federally certified community development financial institution (CDFI). Robert called Wendell and told him to report to work in two weeks. Wendell joined Chicago Community Loan Fund as a senior loan and program officer, and six years later, he became the vice president of lending operations.

Wendell Harris and Sheneka Harris, General Manager of Amped Kitchens Chicago

Chicago Community Loan Fund was founded in 1991 by a group of social-investment advocates who wanted to create a nonprofit lender to provide flexible, affordable, and responsible financing and technical assistance for community stabilization and development efforts in Chicago. Additionally, the nonprofit wanted to fill community development credit gaps by launching initiatives that would benefit low- to moderate-income individuals, families, and neighborhoods throughout metropolitan Chicago. Like other CDFIs across the country, Chicago Community Loan Fund prides itself on ensuring that community developers in Chicago have an accessible lender to turn to for harder-to-underwrite projects and enterprises.

Wendell has been firmly behind Chicago Community Loan Fund’s mission from his first day with the CDFI. Wendell’s father, Moses Harris migrated to Chicago in 1956 where he landed a job as a machinist at the former Oscar Meyer meat packaging plant across the street from the Cabrini-Green housing project.  Wendell’s mother, Ruth, followed in 1957 after attending a year of college at Tougaloo College in Mississippi.  She continues to share her experiences on picking cotton in Mississippi.  Wendell’s parents were part of the Great Migration of Black Americans leaving the South for cities in the North and West. His parents married in 1958 and moved to Markham, Illinois in 1965.  Wendell’s parents were parents to the entire community of Markham.  Moses kept the kids occupied with sports while Ruth sang heavenly gospel notes throughout the South Suburbs and Chicago.  Wendell was surrounded by family members (including 3 older brothers), friends, and community members with varying levels of business acumen.  “I still remember Mr. Faulkner.  To see a black man in the 1980’s own a bumper company in Markham and a Chrysler dealership in Harvey, Illinois, meant a lot to us.  Slavery is more than just chains and shackles,” he said. “Economic slavery hit our communities had and we continue to be boxed in to limited opportunities”

Unsurprisingly, Wendell and his colleagues have an unmatched desire to shrink the wealth gap in metro Chicago, with an emphasis on the South and West sides of Chicago by giving people in the community the opportunities they need to be successful. For Wendell, that means underwriting deals — deals that traditional lenders won’t touch — that will ultimately benefit both community members and the CDFI. In the past five years, Wendell has underwritten investments at Chicago Community Loan Fund that leveraged more than $443 million in real estate transactions that strengthen lower-wealth communities. “We want to allow wealth to flow,” he said. “When that wealth flows, it opens up more opportunities, because families have more to do more with. At the end of the day, our role is to help create more wealth in these communities — period.”

It Takes The Whole Village

Chicago Community Loan Fund plays a unique role in community development efforts throughout Chicago. Not only does the CDFI offer complete financing for small projects that other lenders won’t cover, but Chicago Community Loan Fund also steps in to fill credit gaps for larger projects. That was the case with Amped Kitchens Chicago: a $25.3 million deal to turn a 117,000-square-foot vacant warehouse in Chicago’s Northwest Side into an “apartment building for food companies.” While Chicago Community Loan Fund only lent $4 million to the project, Wendell and his colleagues collaborated closely with a local team of nontraditional lenders like Local Initiatives Support Corporation (LISC) Chicago, BlueHub Capital, and Chicago PACE to bring the project to life. 

Amped Kitchens is a Los-Angeles-based “growth kitchen” company that rents out space and offers amenities and support to businesses wanting to grow. Unlike ghost kitchens, Amped Kitchens focuses more on creating space for wholesale production and distribution, including storage space, offices, conference rooms, and loading docks. Still, when Wendell initially learned that Amped Kitchens wanted to establish its third location in Chicago, he was skeptical. The concept wasn’t new to the Windy City — The Hatchery Chicago’s 67,000-square-foot facility, for example, was already one of the largest food incubation spaces in the country at the time. However, the more Wendell learned about the project, the more he understood how Amped Kitchens could serve the needs of chefs and small business owners in an important way, primarily by offering more space to entrepreneurs who’d outgrown their smaller kitchens. Additionally, given all of the factors at play, Wendell knew that this was a project that would be very difficult for a traditional lender to get behind. “This is part of the cycle of allowing entrepreneurs to really be able to stand on their own,” Wendell said. “And it’s taken the whole village. It’s taken the innovation of the folks in the kitchen, it’s taken the CDFIs’ patience to be able to figure out how to fund it, and it’s taken the large institutional investors to make this happen.”

According to Wendell, the Amped Kitchens project experienced its fair share of hurdles, including the COVID-19 pandemic; however, in October 2021, the new facility officially welcomed its first tenants. Amped Kitchens Chicago is divided into 64 commercial kitchens that range in size from 150 square feet to 2,000 square feet, and although it hasn’t reached full capacity yet, inquiries, tours, and new leases continue to trend upward. Amped Kitchens has already become an important partner in allowing local grassroots food businesses like Soul Vegan, Half Day, and Scone House Cafe to mature in Chicago, helping to give entrepreneurs another stepping stone on the path from their home kitchens to owning their own commercial real estate, having a more viable presence in the community, and building wealth. 

That’s precisely the kind of legacy that Wendell wants to leave behind. Although he isn’t preparing to retire anytime soon, Wendell wants to be able to look back at the work he’s doing at Chicago Community Loan Fund, including the Amped Kitchens project, and know that he was part of building wealth for people in his community. “I want a couple of generations down the line to be able to look back and not have to see how close they are to slavery,” Wendell said.  “I’m hoping to be able to help put the families behind these businesses in a better position to be able to pass on more wealth to their children.”

Learn More

  • Chicago Community Loan Fund is a a federally certified community development financial institution (CDFI) that provides low-cost, flexible financing and hands-on technical assistance to community development organizations for affordable housing, economic/commercial development & social service/nonprofit facility initiatives.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories, Community Partners

Meet The Disability Opportunity Fund, The CDFI Behind West Virginia’s First Fully Accessible Hotel

Charlie Hammerman didn’t aspire to start his own CDFI; however, since his daughter was born with special needs in 1990, Charlie has wanted to be a change agent. Specifically, Charlie’s been on a professional mission to get people to think about and acknowledge the world that he, his family, and some 20 percent of the United States experience: a world touched by the life of someone with a disability. 

Although Charlie spent time working as a federal prosecutor and later as an in-house attorney on Wall Street, it wasn’t until his career shifted over to the capital markets arena in 1997 that Charlie began to feel like he was in a position to begin to “gently persuade” CEOs and CFOs to look at disabilities as another market for their companies. This included pushing for more representation in companies’ marketing campaigns and more targeted marketing at special needs’ communities. For example, Charlie helped Research in Motion, which was later rebranded to BlackBerry, to realize that its technology would be perfect for the hard-of-hearing and deaf communities, as it provided a means for instant communication. Within six months, the company abandoned its B2B stance and placed an advertisement in a disability magazine. It was Charlie’s first taste of being able to have an effect on mainstream America.

In the early 2000s, those experiences motivated Charlie to want to create a social impact fund on disabilities; however, those three words fell foreign on the ears of his bosses. Despite people’s lack of familiarity with social impact funds, Charlie persisted, and one conversation led to another. Finally, he connected with a colleague who told him about Community Development Financial Institutions (CDFIs). According to Charlie, learning about CDFIs for the first time didn’t so much illuminate what he wanted to do, it shined a light on how he could do it.

In 2005, Charlie left Merrill Lynch to found Syracuse University’s Burton Blatt Institute, an organization to advance civic, economic, and social participation of persons with disabilities in a global society. Two years later, Charlie became the university’s director of CDFI initiatives. At the same time, he received a grant from the Citigroup Foundation to hire a consultant to do a market study to determine what a disability-oriented CDFI might look like. 

Once it became clear that (1) there was an available market niche and (2) other CDFIs were excited to welcome a disability-focused peer to the table, Charlie and his wife, Nanci, launched The Disability Opportunity Fund (DOF) in 2008 to provide financing, technical services, and policy advocacy to increase access to appropriate and affordable housing and related services for people with disabilities throughout the United States. “This is an organization that came out of a lot of professional and personal experience,” Charlie said. “We created it to fill a void, and it’s really just grown from there.”

And grown it has. According to Charlie, DOF’s first few years were difficult, especially when it came to fundraising; however, the CDFI has been able to grow its total assets from $390,000 in 2008 to $71.4 million in June 2022. Despite not knowing much about the CDFI industry prior to launching their own CDFI, over the past 16 years, Charlie and Nanci have found ways to expand DOF’s portfolio, work, and team in a way that’s demonstrative of the creativity and community-mindedness that’s often associated with the industry.

‘Something That’s Never Been Done Before’

Since its inception, DOF has been on a mission to reach as many low-income people with disabilities as possible through its lending activities and technical assistance. However, while creating affordable housing units, employment opportunities, and specialized educational programs might seem typical of CDFIs, DOF has established a reputation for itself as being anything but ordinary.  

For example, in 2018, DOF got a call that eventually brought Charlie and Nanci to West Virginia for a long weekend. While the scope of the visit was to learn about the needs of the autistic community there, Charlie and Nanci also got a crash course in opioid-use disorder. That eye-opening experience was punctuated by a stop in White Sulphur Springs, where a 2016 flood had essentially wiped out the town. Charlie and Nanci lived through Superstorm Sandy; however, proportionately, White Sulphur Springs’ flood was much worse. In the town of 2,500 people, 14 died in the flash flood, and of the 1,400 single-family homes in the area, 200 were wiped away in a matter of hours. Two years later, the small town’s commercial core continued to mostly sit empty, filled with mold. 

DOF saw an opportunity to get involved. At the end of 2018, the CDFI won a federal economic redevelopment grant through the CDFI Fund. When DOF received the money in early 2019, Charlie and his team didn’t have to think hard about where they wanted to focus their efforts. They returned to White Sulphur Springs, met with a delegation that included elected officials, town elders, and local merchants, and, ultimately, purchased a city block. Over the next three years, DOF gut-renovated the buildings, including 16 apartments, and the CDFI invested in enhancements to make sure that the town center would be prepared for the next 1,000-year flood. When the work was completed, the CDFI rented out the residential units at 50% market value and the commercial spaces at $5 a square foot.

DOF’s efforts in White Sulphur Springs attracted the attention of a local family, who began redeveloping and revitalizing the other side of the street. With the town’s two-block thoroughfare revived, Charlie and his team turned their focus to the lot around the corner, where a 50,000-square-foot former high school that graduated its last class in 1993 sat vacant. After consulting with the local community and doing a needs assessment, DOF paid $1 to have the 110-year-old high school transferred to the CDFI so that DOF could redevelop it into what the community said it needed most: a hotel. 

However, Charlie and his team didn’t just want to redevelop the building into any ordinary hotel: DOF wanted to create the world’s first fully accessible hotel. “I said if we’re going to do something like this, then we’re going to do something that’s never been done before,” said Charlie. “Let’s make every room accessible and think about every form of disability so that when you walk inside, you don’t have to worry about anything.”

Importantly, despite being the first fully accessible property of its kind, in which the 30 rooms and all public spaces exceed Americans with Disability Act (ADA) standards, DOF didn’t name it The Disability Hotel. Instead, the CDFI cemented the building’s place in White Sulphur Springs’ storied history and called it The Schoolhouse Hotel. Additionally, the CDFI used the hotel to create even more economic opportunity for the local community by incorporating a restaurant and a rooftop bar. Besides catering to tourists, road-weary motorists, and hungry locals, The Schoolhouse Hotel also serves as a space for weddings, conferences, and family-oriented educational events. Today, The Schoolhouse Hotel employs roughly 40 locals, a number of whom either graduated from the high school more than three decades ago or whose parents did. The hotel also participates in various programs to train and hire people with autism, which connects back to what initially brought Charlie and Nanci to West Virginia.

Like all of the loans it has funded in its 16-year history, DOF plans to make sure that The Schoolhouse Hotel will continue to benefit White Sulphur Springs’ community members. As such, even though the CDFI currently owns the building, that won’t always be the case. According to Charlie, he would one day like to turn the hotel back over to the community in some capacity. “This isn’t open-ended,” Charlie said. “As a CDFI, we don’t do 30-year mortgages and we don’t do 15-year mortgages. We do five-year pieces of paper, because the whole idea is to use our money and then to get rid of us so that you can learn how to run that project on your own. Same thing here: the whole idea is to get this back into the local community.”

Netflix, and The Next Generation of Change Agents

In order to make The Schoolhouse Hotel a reality, DOF relied on a combination of grant money and an overall increase in net assets; however, unbeknownst to Charlie and his team at DOF, while they were revitalizing downtown White Sulphur Springs, Netflix was designing a custom note with CNote. In 2021, CNote debuted its customized impact investment offerings to allow enterprises like Netflix to invest in a portfolio of CDFI loan funds selected to meet their impact-aligned goals and to improve their performance on thematic ESG measures. Once its custom note was created, Netflix invested capital in it to support loans for businesses that, among other things, offer direct services and products for disabled populations or that employ disabled populations. Ultimately, one of the CDFIs included in Netflix’s custom note portfolio was DOF, and with Netflix’s investment, DOF was able to complete its work on The Schoolhouse Hotel.

For Charlie, the experience was more than enough to get him excited about what other opportunities might exist when CDFIs like DOF and impact-seeking enterprises like Netflix are able to connect through CNote’s custom notes. “That’s the key point of CDFIs doing the work versus a private equity firm doing the work. In looking at community revitalization, PE firms’ first priority is the financial return of a project. CDFIs are asking, ‘what’s going to make sense for this community?’ We can’t give you a 22% return on your investment like PEs, but we are going to give you a 100% return on impact.”

Going forward, Charlie expects DOF to continue its work toward ensuring that people with disabilities have access to good education, good housing, and good jobs; however, while the CDFI is committed to creative lending and specialized technical assistance, it’s equally committed to recruiting the next generation of changemakers to perpetuate the CDFI’s mission. 

Although Charlie jokes that he’d love to go out of business one day, the reality is that no one is going to work harder to support the disabled community through economic redevelopment than DOF, and until the Marriotts, Hyatts, and Hiltons of the world catch on, DOF will continue to use its platform as a CDFI to lead by example and to prove that accessibility is good for business. “Our work will never be done,” he said, “and that’s exciting. Every single day, our job is to provide the technical assistance to try to either change somebody’s life or to change policy. From day one, our job has been to be a change agent. That’s what we’re doing now, and that’s what we’ll continue to do.” 

Learn More:

  • The Disability Opportunity Fund (DOF) is a community development financial institution (CDFI), launched in April 2007, located in Rockville Centre, New York and operating nationally. They are a 501c(3) tax-exempt organization which provides financing, technical services, and policy advocacy to increase access to appropriate and affordable housing and related services for people with disabilities throughout the United States.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.

 

 

By Community Partners

How VCC Bank Is Using Mission-Driven Lending To Strengthen The Commonwealth

When Virginia Community Capital was established by a group of bipartisan state legislators in 2006, the goal was to create a business model that would attract social investors near and far to create jobs, enhance the quality of life, and promote vibrant communities in historically underserved areas across the state. Part of that business model meant structuring the organization to be both a nonprofit Community Development Financial Institution (CDFI) loan fund and a for-profit CDFI bank, VCC Bank. Like other CDFIs, Virginia Community Capital and VCC Bank provide credit and financial services to people, businesses, and communities not served by traditional lenders. 

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

VCC Bank, however, goes even further to challenge the narrative of what it means to be a traditional lender. Not only was VCC Bank one of the first regulated banks in the country to be designated as a Benefit Corporation (B Corp), but the bank is owned by a nonprofit (VCC Social Enterprises, a new holding company formed in 2021). That means that in addition to adhering to standards set forth by B Lab Global, VCC Bank’s shareholders are interested in more than quarterly dividends: they’re interested in tracking the impact created from their dollars. Fortunately, that impact is measurable. At its founding, Virginia Community Capital was seeded with a $15 million loan. Since then, the organization has turned that original investment into nearly $2 billion in statewide impact.

Over the years, VCC Bank has created the reputation for itself as being the “first in” on high-impact community projects that other lenders won’t touch. In general, those projects fall into one of four lending areas: small business, real estate, clean energy, and healthy food. Since its inception, VCC-financed projects have created over 11,000 affordable housing units, supported 30 food-access projects, backed 26 health-related initiatives, and generated or retained nearly 14,000 jobs. Additionally, VCC Bank staff provide thousands of hours of free advising to community members, including Black, Indigenous, or People of Color (BIPOC) and women small business owners. “A lot of these business owners feel that their needs aren’t being met or that the standards elsewhere are such that they don’t qualify for lending,” said Joey Barnes, VCC Bank’s small business lending manager. “Here, we get the opportunity to educate business owners so that they can then work with their bookkeepers to make sure that when they come back to the bank, their loan package is properly prepared.”

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Another way VCC Bank is supporting BIPOC and women small business owners is through its Economic Equity Fund: a $10 million loan fund that provides low-cost financing and technical assistance to entrepreneurs who were disproportionately affected by the COVID-19 pandemic and who weren’t able to take advantage of PPP funds. According to Joey, the fund has enjoyed a tremendous amount of success in just a short period of time. Since April 2021, VCC Bank has provided about a dozen small business loans totaling approximately $3.3 million. Thanks to a grant, VCC Bank will be able to extend those fund benefits into the future, including free consulting to qualifying small businesses throughout the state.

‘Opportunities Find Us’

When Bill Greenleaf joined VCC Bank as its senior vice president of real estate lending seven years ago, he was thrilled to have the opportunity to combine his background working in real estate finance with his interest in solar energy to help create VCC Bank’s clean energy loan program. Similar to its other lending programs, VCC Bank steps in to make clean energy loans — primarily relating to solar energy projects — when other banks aren’t willing to get involved, either because a given project is too small or because banks don’t want to invest the requisite time to “figure out how to do it,” says Bill. According to him, even though these projects tend to be small, they have high mission impact, as they often provide free solar energy to low- and moderate-income households. 

Bill Greenleaf, SVP of Real Estate Lending and Joey Barnes, SVP, Small Business Lending Manager. Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Given its roots in Virginia, it’s not surprising that VCC Bank has done solar lending across the commonwealth, as well as in the District of Columbia; however, the organization has also done loans in places like New Jersey, New York, North Carolina, and Tennessee. Interestingly, VCC Bank’s expansion into neighboring states isn’t a result of proactive marketing efforts. Instead, Bill says that VCC Bank is able to make those loans for two reasons. First, traditional lenders’ avoidance of clean energy lending isn’t unique to Virginia. Second, VCC Bank enjoys a robust referral network that extends beyond Virginia’s borders. “We’ve developed some expertise, and we’re willing to lend out of state and to look at larger deals,” Bill said. “People hear about us, and because we’re willing to work on oddball deals, opportunities tend to find us.”

“Oddball deals” finding VCC Bank isn’t unique to its solar energy lending program. Whether it’s on the affordable housing side, the small business side, or the healthy food side, the bank’s lending team enjoys a remarkable number of incoming leads. Obviously, not all of those inquiries turn into deals; but, just last week, VCC Bank approved a loan to a nonprofit so that the nonprofit can continue its work supporting approximately 80 disadvantaged farmers and grain processors in Virginia while it waits for grant reimbursements from The United States Department of Agriculture. Over the next year, as the grant money comes in, the nonprofit will pay down its loan with VCC Bank. “We’re providing some of the upfront capital to help those farmers,” said Joey. “That’s just one example of how we’ve shifted to trying to serve producers, aggregators, and processors instead of retailers with our food access financing.”

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Going forward, VCC Bank plans to improve and expand upon its four lending programs while paying attention to evolving community needs. Although it’s too soon to know how the market will shape its future operations, one thing remains certain: whether it’s creating affordable housing, working with small business owners, funding clean energy projects, or investing in local farmers, VCC Bank will continue to meet the needs of the community when other banks won’t. According to Bill, continuing to forge strong partnerships will be key to the social impact lender’s future success. For example, in 2020, VCC Bank became one of CNote’s Impact Cash™ partners, which allowed it to greatly reduce its reliance on the kind of higher cost  deposits it previously needed to meet its increasing loan demand. However, thanks to its partnership with CNote, VCC Bank hasn’t had to book any wholesale funds in the last 12months. “We’re always trying to streamline the loan capital we provide,” said Teresa Martin, VCC Bank’s Director of Deposits, “and CNote’s Impact Cash™ solution is really allowing us to be more impactful with our dollars.” 

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Learn More:

  • Virginia Community Capital is a Community Development Financial Institution (CDFI) with a mission to create jobs, energize places, and promote an enhanced quality of life for Virginians.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

How The Council On Alcoholism And Drug Abuse Of Northwest Louisiana Is Leveraging A Credit Union Partnership To Rebuild People’s Self-Worth

Bill Rose recently celebrated a big milestone: 34 years of sobriety. That also happens to be nearly how long Bill has been active in rehabilitation facilities. Six months into his recovery from drug and alcohol addiction, Bill began volunteering in drug treatment programs. At the time, he worked for a local oil company, but he also helped out at a hospital-based inpatient recovery program near where he lived in Louisiana. When Bill was laid off from his job in 1989, his life could have spiraled back to late nights out and high-risk activities; however, instead, Bill continued forward on his path of recovery. 

Bill Rose, Executive Director of CADA

That’s because Bill was connected with Dan Talley, the Executive Director of The Council on Alcoholism and Drug Abuse of Northwest Louisiana (CADA). Dan’s wife, Bonnie, worked at the hospital where Bill volunteered, and when she heard that Bill was out of work, she introduced the two to each other. One week later, Bill was a full-time CADA employee. “CADA embraced me and gave me a place to land,” said Bill. “They helped to mentor me, support my recovery, and keep me in a safe place, and my career kind of took off from there.”

CADA was established in 1958. Since then, the nonprofit private health organization has continuously provided substance abuse and addiction treatment services to Northwest Louisiana. Today, CADA offers 12 programs out of four facilities that serve Shreveport, Bossier, Many, and many rural areas across Louisiana, including at every horse racetrack in the state. The nonprofit prides itself on offering services to anyone, including adults and teens, regardless of their ability to pay. CADA is able to do this through a wide variety of payment options that include Medicaid, private insurance, and, in some cases, state funding.

According to Bill, CADA helped him get into counseling, and after five or six years, he left the nonprofit to pursue opportunities that he never would have had without Dan Talley’s guidance and CADA’s support. However, in 1998, when a management position opened up at CADA, Bill didn’t have to think twice about whether or not to apply. He got the job, returned to CADA, and Dan Talley became his boss. Bill’s been at CADA ever since.

Over the years, Bill has served a number of roles at CADA. He’s been a program manager of the nonprofit’s drug court program, helping clients to avoid jail time by coaching them through an intensive, long-term recovery path. Additionally, Bill was a program director at one of CADA’s detox centers, during which time he was also responsible for a 71-bed care facility. More recently, since early 2012, Bill has served as CADA’s Executive Director, leading a team of roughly 100, which includes full-time, part-time, and contracted employees.

According to Bill, although it wasn’t easy to transition away from counseling and programming, he felt like stepping in to serve as executive director was something he needed to do. “Dan Talley left such an impression on me,” Bill said. “For whatever reason, he took an interest in my recovery and taught me how to be a counselor, and when he died, I said that I was going to commit myself to doing whatever CADA needed me to do.”

Bill Rose and Walter Abney, a Peer Support Specialist

Although these days Bill spends most of his time working with CADA’s accounting department, human resources staff members, and development team, he also gets to work closely with Susan Garcia, CADA’s Director of Client Relations and Engagement. Like Bill, and roughly half of CADA’s workforce, Susan is in recovery. However, when Susan first walked through CADA’s doors, she was wearing shackles. She completed CADA’s recovery program, applied for a cook job at the nonprofit, and steadily climbed the ranks to her current position. Susan played a vital role in CADA opening a location in Many, her rural hometown where she knew firsthand that there was a need for addiction recovery services. Today, Susan holds the honor of being Louisiana’s Peer Recovery Support Specialist of the Year.

“I still get chill bumps when I think about how Susan walked into our facility literally in shackles and now she’s in a position probably more than me to help people recover,” said Bill. “That story never gets old. That’s the cool part of being sober for 34 years: it’s to see the light come on in a person that’s broken, and their lives start progressing along in a manner that they didn’t even imagine.” 

The Financial Piece of Recovery

Two years ago, Susan happened to meet Cyndi Phillips at a fundraiser event with a CADA alumni group. Cyndi is the Director of Community Development at ANECA Federal Credit Union, a Louisiana-based credit union that first opened in 1939. CNote invests Impact CashTM dollars in mission-driven and FDIC- and NCUA-insured credit union partners like ANECA, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country.

Cyndi and Susan met for lunch to discuss how they might work together, and ever since, ANECA has been one of CADA’s most supportive community partners. According to Susan, the credit union participates in just about every event that CADA hosts, and Cyndi is a regular fixture at CADA’s open houses and weekly Friday graduations, at which the credit union supplies the caps and gowns. “ANECA is a joy to work with,” Susan said, “and Cyndi supports everything we do.”

Susan Garcia and Tine Jolley, HR Manager at CADA

Importantly, ANECA also offers CADA clients financial literacy classes, which include training on how to detect and avoid predatory lending. Additionally, ANECA helps to get CADA clients on the path to opening up checking and savings accounts, as well as improving their credit scores. These are vital services, considering that many of CADA’s clients don’t have a state-issued identification card or driver’s license and would otherwise be unable to open a bank account. 

According to Bill, giving CADA’s clients the opportunity to take their cash and put it safely into an ANECA account is an important part of the recovery journey. “Money can be a trigger,” he said, “so for a big percentage of the folks that we treat, it’s not a good practice to keep money in your pocket. Bringing in a lending institution like ANECA has been beneficial for folks getting on their feet.” 

That was the case for Susan. According to her, before she was sober, and even early into her recovery, she thought that having a bank account was out of reach. However, thankfully, she was given the opportunity to open an account: a seemingly small accomplishment that helped to propel her forward in her recovery. That’s because, as she described it, having a bank account boosted her self-esteem and made her feel like a human again.

“Addiction has a significant impact in every area of a person’s life, including banking,” said Bill. “When we’re able to help someone get that first checking or savings account, do you know what it does for their self-esteem and self-worth? I can’t put a dollar value to it. The financial piece is a big part of the puzzle of trying to get some stability in life, and it’s amazing to see how ANECA’s work plays a part in people’s recovery.”

Learn More

  • The Council on Alcoholism and Drug Abuse of Northwest Louisiana (CADA)  is a 501(c)(3) non-profit, private health organization providing substance abuse services.
  • ANECA Federal Credit Union, a Louisiana-based credit union that first opened in 1939.
  • CNoteCNote is a women-led impact platform on a mission to close the wealth gap through financial innovation. Using the power of technology and a community-first framework, CNote enables corporations and individuals to efficiently invest at scale in fixed income and time deposit products that advance economic equality, racial justice, gender equity, and climate change initiatives.
By Borrower Stories

How Terri-Nichelle Bradley is Bringing Black Representation To Target’s Toy Aisles

Terri-Nichelle Bradley used to be frustrated with her job. What had begun as an exciting career with Sesame Street Live had shifted to working for a multi-national public relations agency. If handling corporate crisis communications wasn’t enough, Terri-Nichelle also had to carry the burden of being the senior-most Black woman at the company. She was tokenized by her white colleagues and saddled with the weight of expectation from her junior Black peers. According to Terri-Nichelle, she used to sit in her car every day and cry. She was miserable, and eventually, she was fired.

That’s when a 40-year-old Terri-Nichelle went on a quest to find her purpose — luckily, she didn’t have to travel far. On a popular mountaintop outside of Atlanta, Terri-Nichelle put the question “what am I supposed to be doing?” out into the ether. The answer she received was “look at your life.” Her subsequent reflections took her back to her Minnesotan childhood, where Terri-Nichelle’s mother surrounded her family with Black art and kept Black magazines on the coffee table. Even though she wasn’t necessarily surrounded by neighbors who looked like her, Terri-Nichelle grew up knowing that Black people could be successful. As a child, that knowledge allowed her to dream.

As Terri-Nichelle looked back at the Black representation that had been so integral to her upbringing, she had her mountaintop aha moment. As a mother of four, she’d been hearing more and more about the leaky STEAM pipeline — the educational pathway for students in the fields of science, technology, engineering, the arts, and mathematics in which underrepresented minorities, including women, often fall through the cracks. Terri-Nichelle wondered what she could do to reverse that trend. After some research, she decided to start Brown Toy Box, an educational play-kit company that makes toys to get BIPOC kids excited about STEAM careers.

Terri-Nichelle launched her company as a subscription service in October of 2017. By June the following year, she shut it down. According to her, she didn’t have the requisite business acumen, which meant that Brown Toy Box had been destined to fail fast from the beginning. However, Terri-Nichelle wasn’t discouraged. She’d learned about her customers and the market, and she was willing to give it another shot. “I said to myself, ‘if you’re going to do this, you’re going to do it right,” Terri-Nichelle said. “‘You’re going to have to do the training so that you can be very intentional and purposeful about how you’re going to relaunch this business.’”

Try, Try Again

Terri-Nichelle did just that. In total, she participated in eight incubator and accelerator programs. Terri-Nichelle decided to evolve away from subscription boxes, and although she still wanted to build her business around educational kits, she wanted to be “a creator of product, instead of a curator of product,” as she puts it. Despite the fact that she never wrote a book about astronomy or made puzzles about marine biology, Terri-Nichelle believed that, ultimately, it was better to believe in herself rather than to rely upon other small business owners to make Brown Toy Box work. “I’d never created anything like this before,” she said, laughing. “But I was like, ‘I can do it.’ It’s the audacity of just believing in yourself.”

Come the beginning of 2019, Terri-Nichelle was ready to make her second attempt at Brown Toy Box. She’d hired a toy designer, she’d created the Dadisi Academy crew (Black students at a fictitious school named after the Swahili word for “curious”), and she’d designed themed kits around subjects like chemistry, robotics, and coding. Initially, Brown Toy Box returned to selling primarily to schools, however, the company also began to sell direct-to-consumer. That’s when COVID-19 hit. The pandemic effectively paused all of Terri-Nichelle’s business operations. As schools shifted to remote learning, budgets were redistributed to provide hotspots and laptops for students, not educational kits. 

That’s when Terri-Nichelle got scrappy. She stopped paying herself and she grew her business into a full-scale educational toy manufacturing company that produces and curates STEAM toys and experiences for children, grades pre-k through 6th. Every toy, game, activity, piece of media, and DIY experience focuses on promoting inclusivity, celebrating Black children, cultivating curiosity, normalizing Black excellence, and building skills that create pathways to prosperous careers. When schools were once again ready to sign contracts and distribute Brown Toy Box kits to students in August 2020, so was Terri-Nichelle. “It’s about all kids having access to these toys,” she said, “because that’s how we’re going to change the narrative, and that’s how we’re going to make sure that Black people aren’t just seen as the athletes and entertainers.”

On Target

In January 2021, Terri-Nichelle got her biggest opportunity yet — pitching the toy buyers at Target Corporation. The meeting was on a Friday, and on the following Monday, Terri-Nichelle got the call: the retail giant wanted Brown Toy Box in every one of its stores. It was wonderful news, but it was also daunting. Despite previous funding she received from the Google for Startups Black Founders Fund and SheEO that helped her to grow during the pandemic, Terri-Nichelle didn’t have the money to ramp up production to meet demand — Target wanted nearly 40,000 kits. Terri-Nichelle reached out to her network to fundraise. “We didn’t have enough revenue to qualify for a bank loan,” she said. “One of my mentors who leads a bank told me ‘we won’t look at you for another couple of years.’”

Fortunately, Terri-Nichelle had previously been co-located in an incubator with Access to Capital for Entrepreneurs (ACE), a Community Development Financial Institutions (CDFI) that works in 68 counties in Georgia. CNote partners with CDFIs like ACE in communities across America, funding loans to small businesses, providing technical assistance, and empowering local entrepreneurs like Terri-Nichelle. 

Terri-Nichelle reached out to ACE, and the CDFI was able to get the toy manufacturer the necessary financing needed to execute the Target deal. Although the larger deal was eventually underwritten by many participating institutions, ACE funded the first $500,000 to Terri-Nichelle, which allowed Brown Toy Box to secure the inventory needed to enter 1,757 Target stores. However, in addition to lending, the CDFI’s founder and CEO, Grace Fricks, became a vocal advocate for Terri-Nichelle, and it helped to bring other Atlanta partners — including the Atlanta Wealth Building Initiative, 1863 Ventures, and Invest Atlanta — to the table to provide additional funding for Brown Toy Box’s inventory rollout across the country. 

“The reason that we are where we are right now is because we were able to get the capital,” Terri-Nichelle said. “That happened because some really strong women in the investment and finance sectors really showed up for me. So many small businesses have to leave Atlanta, and these women said ‘we want to change that narrative: we don’t want entrepreneurs to have to leave this city in order to make things happen. Women-owned businesses need that type of advocacy, because you don’t usually find it.”

Target Practice for the Future

According to Terri-Nichelle, once the ball started rolling, it never stopped. With funding in one hand and Target purchase orders in the other, she set out to secure office space, forge new partnerships, and grow her team. That’s when ACE provided Terri-Nichelle with technical assistance: the CDFI advised her on hiring and it reviewed contracts for her, particularly as she built out her executive team. “I’d never hired like this before,” she said, “so they were able to use their expertise to help me think through those important things.”

Terri-Nichelle fulfilled every one of those purchase orders, and Target has been selling Brown Toy Box products in its stores and online since October 2021. However, Terri-Nichelle and her team — which includes her two oldest sons — didn’t stop there. The company has a new partnership with Lakeshore Learning, its kits are available for purchase at The Village Retail, and it’s finalizing a partnership with Microsoft that will take the Dadisi Academy crew online by September 2022. If that wasn’t enough, Terri-Nichelle is also working on a licensing deal with a major global brand. According to Terri-Nichelle, she’s projecting $3.5 million in sales in 2022, which is up from $1 million in 2021 and $220,000 in 2020. 

Unsurprisingly, Terri-Nichelle is dreaming big for Brown Toy Box’s future. She wants to turn the Dadisi Academy into an animated series and she wants her company to be a global force of play-based, culturally responsive education. “We really want to blow out any limitations that anybody has ever put on us, including those limitations that we put on ourselves,” said Terri-Nichelle. “We can change the trajectory of so many kids’ lives. My goal is for a kid to walk up to me in 15 years and say ‘I’m a chemist because of Brown Toy Box. That’s my goal, and that’s my purpose.”

Learn More

  • Brown Toy Boxan educational play-kit company that makes toys to get BIPOC kids excited about STEAM careers.
  • Access to Capital for Entrepreneurs (ACE) – ACE is an SBA Microloan Intermediary, a USDA Intermediary Relender and a certified Community Development Financial Institution (CDFI).
  • CNote – Interested in helping create another story like Terri-Nichelle’s? CNote makes it easy to invest in great CDFIs like ACE, helping you earn more while having a positive impact on businesses and communities across America.
By Community Partners

Meet Kaua’i Federal Credit Union, The CDFI Investing In Its Island Community

“I never thought I would end up working in a financial institution,” says Ivory Lloyd of Kaua’i FCU. Samoan born and raised on Kauaʻi, in her college years, she worked in non-profits mainly focused on sustainability. With an undergraduate degree in political science and an international master’s degree in sustainable development and corporate social responsibility, she had an ideal background for cooperative finance, but the financial services industry was the last place she thought she would find herself. 

Ivory Lloyd, COVID Recovery Program Manager at Kaua’i Federal Credit Union

Global travel led her back to her home on the island of Kauaʻi and after becoming a mom of two boys, Ivory started a business, The Lei Collective, teaching lei making. She realized quickly that her business, which was hosting workshops on how to make lei poʻo (Hawaiian flower crowns) was really more about creating spaces for people to gather than it was about working with flowers. Her lei poʻo workshops created the opportunity for her to meet women from around the world who, like her, were mothers or entrepreneurs, looking to do something constructive but also meaningful on a personal level.

“Finding time for yourself, as a mother or female entrepreneur, is no easy task,” she admits. “I discovered that women loved attending my lei workshops because it allowed them time to be surrounded by other women, and enjoy making something beautiful for themselves.” Quickly, she realized her ʻsuper powerʻ, inspired by the flowers, was in gathering people together and weaving their talents and conversations into a whole, a process embodied in the creation of a lei. When the pandemic hit, this opportunity to foster community through the business of lei making was put on hold. The silver lining was that COVID opened up time for her to pivot, as it did for many entrepreneurs. 

Kauaʻi is one of the smallest and most remote land masses on earth. In 1992, Hurricane Iniki caused devastating damage to the island. It is in times of great adversity that Kauaʻi and its community shine the brightest. Due to the inability of large groups to meet, Kauaʻi FCU began hosting small pau hana (after hours gatherings) at their newly opened Kilauea branch. The new branch provided a space for community members and leaders to meet, connect and talk about their challenges at a time when everything was shut down. Ivory attended, with a few other community members, and it was then that her interest in community building began to take a sharper focus. For the first time, she learned the distinction between credit unions and banks. The social mission behind credit unions and the way Kauaʻi FCU ʻfeltʻ and was being led, were completely different than any other financial institution she had ever known. 

“I knew nothing about credit unions until that day, and from that day forward, when I met with Monica (Belz, CEO at Kauaʻi FCU) and her team, all I knew was that I didn’t care how or when, but that I wanted to be a part of it,” she says. 

Starting as a teller, Ivory was able to meet the members and learn the mechanics of the credit union. She began helping Kauaʻi FCU’s Community Development team with rent relief programs including a program with Aloha United Way that no other credit union on Kauaʻi was involved in. In 2021, when it was clear the pandemic was not over, Kauaʻi FCU created a new position, COVID Recovery Program Manager, with a sole focus on creating economic resiliency for Kauaʻi. Ivory jumped into the role with trademark enthusiasm and was able to bring her work as a small business owner, mother and resident of Kauaʻi into full play. “I love bringing people together and I love to connect with them,” she says. “This really translates into the work that I do now, as an advocate for small businesses within the credit union space. I figure out how we can support them (however it may be) as a financial institution.” 

As the only credit union CDFI (Community Development Financial Institution) on the island of Kauaʻi, Kaua’i FCU is building resiliency in a network of public, non-profit and private sector partnerships in a way that has never been done before.

Tackling Kauaʻi’s Biggest Challenges

In 1947 — 12 years before Hawaiʻi became a state — Kauai Territorial County Federal Credit Union was established to provide county, state, and federal government employees and their families with basic financial support, and to invest in and grow the quality of life on the island. The credit union changed its name in 1990 to Kauaʻi Government Employees Federal Credit Union, and in November 2021, simplified it to Kaua’i Federal Credit Union. As its history suggests, the credit union’s membership primarily includes government employees and first responders, however, Kaua’i Federal Credit Union serves all of Kaua’i, and everyone can be eligible to join. This is a plus, considering that locals —  from keiki (children) to kupuna (elders) — face many of the same challenges living on Kauaʻi as their ancestors did. These challenges include a lack of affordable housing, natural disasters, and over reliance on a tourism driven economy. Unsurprisingly, each of these challenges was exacerbated during the COVID-19 pandemic.

As a partner of CNote’s Impact CashTM program, Kauaʻ’i Federal Credit Union has access to low-cost capital that it invests in its community. As an MDI with CDFI certification, Kauaʻi FCU has gained access to a lifeline of US treasury funds that channel resources to undercapitalized communities and create opportunities for local businesses and generate positive social impact. It couldnʻt be more needed. 

Here are three ways that Kaua’i Federal Credit Union is leveraging CNote’s Impact CashTM dollars in its community:

1. Rental Relief. At a time when mainland billionaires are gobbling up land on Kauaʻi, many locals live paycheck to paycheck, thus making Kaua’i Federal Credit Union’s Rent Relief and Housing Stability program one of its most impactful. Thanks to CDFI funding, the credit union partnered with the county to launch its Coronavirus Rent and Utility Assistance (CRUA). To date, the credit union has deployed more than $22 million to assist over 2,500 households. The program aims to create housing security for all Kauaʻi residents, regardless of whether they’re members of the credit union or not. “This is one of our strengths as a credit union,” says Ivory. “When we see an opportunity where we can be the conduit to support our community in ways that they otherwise would not have been able to: we say yes, 100%, we are in.”

Although there’s little that Kauaʻi Federal Credit Union can do to address the high cost of living, what it can do through rent relief is ensure that income disparity doesn’t drive local residents off the island. Anecdotally, Ivory shared this story:

“Kaua’i is a small island and our communities are even smaller. The people that we are helping to get rent relief are not just names and numbers on a spreadsheet; they are our friends, our kupuna, our neighbors, and our families! Every week I get a dozen texts thanking us for helping them with their rent, or asking us to come over and help them fill out paperwork. That’s what we do, we are small but we know our community because it is us. Just the other evening, we were watching the sunset on the beach and one of the guys who we had helped get rental relief came in from surfing, ran down the beach to me and said, ʻI didn’t think this could happen.’ He was in disbelief. Because of our rental relief program, he was able to save some money and go to school to become an EMT. Ensuring that the kids who grew up on Kauaʻi are able to survive the pandemic and better themselves is one of the impacts that this rental relief program is having.”

(From left to right) Monica Belz-President and CEO, Chantal Zarbaugh-Business Development Officer, Dana Hazelton- Community Development Officer, and Ivory Lloyd- COVID Recovery Program Manager.

2. Environmental Resilience. Kaua’i has an abundance of natural beauty but more and more, the island is subject to devastating natural disasters. While most people think of firefighters, police officers, and lifeguards as first responders, Kaua’i Federal Credit Union is also a first responder. Because Ivory and her colleagues are so connected to the community, the credit union is always just a text message away from responding to the next emergency and providing assistance in whatever ways it can. “We are always trying to think about how we can best prepare ourselves to be ready for anything,” says Ivory. “It’s part of our DNA.”

For example, in March 2021, following a major landslide in an area still recovering from catastrophic flooding, Kauai Federal Credit Union’s Monica Belz and the Community Development team launched the Hawai’i Sister Society via zoom at 8:00 a.m. By 10:00 a.m, they were in boots and gear, packed up to bring a truck load of food across the Hanalei River in a dinghy boat with other community members. With road access cut off in and out of Hanalei, Ivory set up a pop-up branch on the North side of the river to offer financial services, provide rental relief and accept deposits while roads and bridges were repaired. “I’ve never seen this from a financial institution,” Ivory says, “but this is who we are. We are a really small community, and this is one of our superpowers as a credit union: we show up.” 

3. Economic Diversification. Like the rest of Hawai’i, Kauaʻi’s economy centers around tourism. When the COVID-19 pandemic grounded planes on the mainland, the island instantly lost its major revenue stream. Once this happened, Ivory says people began to realize that they needed to do things differently, including thinking about their shared economic sustainability. As the owner of a small business that primarily catered to tourists, she herself had to think about how she could pivot her business to be tied more to Kaua’i and less to those visiting it. 

Programmatically, Kaua’i Federal Credit Union is also addressing this issue. First, the credit union immersed itself in the Paycheck Protection Program (PPP), distributing loans ranging from $300 to $300,000. These forgivable loans helped to keep small businesses afloat during the worst of the pandemic so that entrepreneurs had the necessary time to make changes for the future. To date, Kaua’i Federal Credit Union has deployed $24.2M in COVID relief.

Ally and Gabe Avalon, owners of Avalon Gastropub, were recipients of a PPP loan from Kaua’i Federal Credit Union

Secondly, the credit union partnered with Common Ground Kauai, launching an incubator program to help local small businesses to create and export agriculturally based products. Thirdly, the credit union collaborated with the nonprofit Lady Entrepreneurs + Innovators of Kauai to create women-focused courses on marketing, finance, and business. “We had women who worked in the tourism industry for 20+ years,” says Ivory. “When the tourism industry shut down, a lot of people made their side gigs their main gigs, so we created these courses to give them whatever they needed to help them succeed.” 

As the pandemic continues to change everyday life, Ivory’s position as the COVID Recovery Program Manager will become more focused on creating a resilient and diverse economy so the island can thrive in the long term. Whatever this looks like – whether through rental relief, small business wrap around services, or the creation of innovative lending products for the next generation of homeowners, Kauaʻi FCU is on the front lines every day. “We know that infusing capital back into our communities to support a more cyclical economy will ensure our island and its people can thrive and become a model for other places around the world.”

Learn More:

  • Kaua’i Federal Credit Union helps the people of Kaua’i by keeping money on the island for a stronger financial future for our people. They offer their members the financial services and products that are right for them at preferable rates and at little or no cost, ensuring the wellness and wealth of future generations.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories, Community Partners

How Metropolitan Economic Development Association Is Scaling Itself To Shrink Minnesota’s Racial Wealth Gap

Over the course of their careers as inpatient nurses, Murwo Elmi, Ikraan Abdulle, Farhia Abdulahi, and Faiso Abdulle have seen a bit of everything. From their first shifts, the Minneapolis-based health professionals have cared for patients struggling with mental health, chemical dependence, physical and cognitive limitations, and homelessness. After 10 years, however, the group shared a similar realization: once their patients were released back into their communities, they didn’t have the support and stability necessary to avoid becoming either hospitalized or institutionalized again.

The OurPlace Residential Services team: (from left to right) Farhia Abdulahi, Ikraan Abdulle, Murwo Elmi, Faiso Abdulle

In 2017, the quartet started having a conversation about how their marginalized patients could be better served. Rather than establish a group home, the Somali-born nurses wanted to create a community space that fostered healing, independence, and stability. They called it OurPlace Residential Services. “There’s a need for this population to be served in a community setting,” said Ikraan. “Instead of being institutionalized, we wanted to be able to work with individuals and to address their social needs through community support, which is essential to everyone’s health.” “Patients need a stable home where they can see themselves for a long time,” added Faiso. “Not a 30-day shelter.”

According to the nurses, their vision to establish such a space had never been done before — at least not in Minneapolis. However, regardless of how much research the team did to educate themselves on how to create the best possible programs, policies, and protocols, one daunting challenge remained: securing the capital necessary to acquire an apartment building and to renovate it to meet their needs. The entrepreneuring nurses approached multiple banks in Minnesota, but they were told the same thing everytime: they didn’t have the necessary collateral or capital to turn their dream into a reality. 

The Creativity To Say ‘Yes’

That’s when the nurses at OurPlace Residential Services connected with Patrick Pariseau, the vice president of lending and client services at Metropolitan Economic Development Association (Meda). Founded in 1971, Meda is a Minneapolis-based Community Development Financial Institution (CDFI) that works exclusively with Black, Indigenous, and People of Color (BIPOC) entrepreneurs. In its first 50 years, Meda has served more than 25,000 BIPOC entrepreneurs, helping to build generational  wealth and to address the racial wealth gap in the communities it serves. Meda partners with CNote through the fintech company’s Wisdom Fund, which was set up to serve the exact demographic that the CDFI strives to empower.

Eleven years ago, Patrick stepped out of semi-retirement to join Meda’s team. After 30 years of banking, Patrick wasn’t seeking another job, but one of his friends who worked at Meda asked him if he would be interested in helping out with a couple of the CDFI’s loans. Patrick said “yes,” and less than three months later, he was a full-time Meda employee. When Patrick joined Meda, the CDFI had 14 loans in its portfolio. Today, the CDFI has a portfolio of 647 loans, totaling approximately $21 million. That amount is quickly growing to $40 million. 

Patrick Pariseau, Meda’s Vice President of Lending

That growth, in part, is thanks to the work Meda was able to do during the second round of Paycheck Protection Program (PPP) lending. Meda tapped into its local community and told everyone from CPAs to other lenders to send any sole proprietor and small business owner who needed help to contact the CDFI. Incredibly, with only two employees dedicated to PPP, Meda deployed 467 loans to local small business owners: approximately $11 million. Each of those loans went to a BIPOC entrepreneur, and 97% of those entrepreneurs identified as Black or African American. To date, 97% of Meda’s PPP loans have been forgiven. 

While those numbers speak for themselves, Patrick gets more excited about how the CDFI is able to achieve those lofty numbers and to create tangible impact in its community. According to him, Meda’s success is rooted in the following:

1. Creativity is in Meda’s DNA. “You have to be creative in this business,” Patrick said. “There are things we can do as a CDFI that banks can’t do.” For example, like other CDFIs, Meda’s underwriters place less emphasis on a small business owner’s credit score and more emphasis elsewhere, such as the person’s character and the business’ scalability. The CDFI also double weights cash flow, which allows for more entrepreneurs to qualify for lending. “Businesses run on cash flow,” said Patrick. “That’s the way it should be underwritten.”

Meda believes so much in the importance of cash flow that its primary lending product is built around it. Meda is one of the few CDFIs in the country to offer operating lines of credit. According to Patrick, operating lines of credit require fewer dollars and effectively allow the CDFI to deploy more loans to more small business owners. Patrick refers to it as an “equity product,” because the loans have modified, interest-only payment terms and they give small business owners the opportunity to put their cash back into their young businesses. “People need to put payments into their business, not the banking system,” he said.

2. Meda is scaling to the size of the problem. Like CDFIs across the country, Meda invests in small businesses not just so they can keep the doors open, but so they can grow. However, while many small-but-mighty CDFIs bend over backwards to help entrepreneurs scale their businesses, Patrick says that many CDFIs forget that they too need to scale. 

Not Meda. Thanks to a technology grant, the CDFI is currently piloting a new, integrated computer system — the same one commercial banks use — to be able to offer automated loan applications from anywhere in the country. Similarly, Meda invested in state-of-the-art underwriting software that’s been rated as one of the top five scalable systems in the country to help businesses grow. According to Patrick, that’s why Meda was able to meet the community’s PPP demands: the CDFI had already laid the foundation for itself to grow. “We’re scaling Meda to the size of the problems here in the Twin Cities,” he said. “These disparities aren’t going away unless we scale and continue to deepen our impact.”

3. Meda views banks as partners. Having spent three decades in banking, Patrick knows that banks aren’t CDFIs’ enemies: banks are regulated. However, even though Meda can be creative to serve its community in flexible ways that banks can’t, the CDFI still works very closely with local financial institutions. Because Meda strives to help its borrowers scale to over $1 million in revenue in less than 36 months, Patrick says that it’s in banks’ best interests to refer customers to Meda’s technical assistance programs. 

Meda has a few business consultants on staff; however, to scale its impact, the CDFI created what it calls the Volunteer Accelerator Network, where skilled volunteers virtually assist entrepreneurs through curricula designed to prepare small business owners to be successful. “We know that technical assistance works,“ Patrick said, “and if a bank refers a client to us and if they become successful, then I’m going to send that business owner back to that bank, because that means Meda can recycle its cash quicker and deploy another loan. That leverage is crucial for us.”

Additionally, every year, Meda deploys $20-$40 million in companion financing with partner banks, primarily in the form of real estate deals. For example, Meda is involved with a $6 million deal to build Minnesota’s first detox center for women. The CDFI invested $2 million in the project, and a partnering community bank put up the remaining $4 million. “The bank feels more comfortable with it because they got less risk,” Patrick said. “And because we all worked to make it happen, somebody gets a new building and a brand new business opportunity that’ll pay taxes and hire workers. That’s what it’s all about.”

Kari Groth Swan, Meda’s Director of Philanthropy and Investment and Patrick Pariseau, Meda’s Vice President of Lending

It Takes A Village

In fact, after saying “no,” a bank referred the nurses behind OurPlace Residential Services to Meda. The bank knew it was the exact kind of project that Meda would want to fund. That’s because in addition to supporting BIPOC and women entrepreneurs, Meda is committed to revitalizing neighborhoods through commercial diversification. To do that, the CDFI favors working with entrepreneurs in struggling neighborhoods who own non-retail companies like manufacturing facilities, medical clinics, and child care centers. Additionally, Meda works closely with aging small business owners to sell their businesses to BIPOC entrepreneurs to help create neighborhood sustainability. By choosing to take on a more eclectic portfolio of small business borrowers, Meda is doing its part to revitalize neighborhoods in its community. 

Unsurprisingly, Meda was behind OurPlace Residential Services from the very beginning. The CDFI leveraged its contacts in the real estate community to locate a promising apartment building, and it was unfazed by the $2.5 million price tag to acquire and renovate it. Patrick had trust in his construction background, and Meda is engaging with potential funding partners, like the City of Minneapolis, to position OurPlace Residential Services’ new building for success.

Thanks to Meda, OurPlace Residential Services is on course to open its building to its first 14 clients later this year. The nurses have already grown their team to 15 direct support staff members: a number that is likely to keep growing. That’s because, longterm, OurPlace Residential Services’ goal is to help eliminate housing instability and homelessness in its community. To do that, the nurses want to multiply their innovative model for patient-centered care across the Twin Cities metropolitan area, providing long-term housing opportunities to patients, regardless of where they are in their recovery journey.

In pursuit of that goal, OurPlace Residential Services will continue to rely on and collaborate with community partners like Meda. “Sometimes, we look at one another, and we say ‘is this really happening?’” said Murwo. “It’s amazing, and we couldn’t have done it without Meda taking that chance on us. We needed an ally who had the knowledge and understood the community’s needs, and we needed a champion that really loved the idea. That’s what we got with Meda. They made this happen.”

Learn More

  • OurPlace Residential Services
  • Metropolitan Economic Development Association (Meda) was founded in 1971 with a mission of Helping BIPOC Entrepreneurs Succeed.
  • CNote is a women-led impact platform on a mission to close the wealth gap through financial innovation. Using the power of technology and a community-first framework, CNote enables corporations and individuals to efficiently invest at scale in fixed income and time deposit products that advance economic equality, racial justice, gender equity, and climate change initiatives.
By Borrower Stories

Meet Lorain Francis, Whose Full-Time And Volunteer Jobs Are To Fight Food Insecurity In Maine

Although Lorain Francis hasn’t always worked on the frontlines of food insecurity, she’s been surrounded by volunteerism for as long as she can remember. Lorain grew up in Fairport, New York, where both of her parents were active volunteers in the community. Unsurprisingly, when Lorain grew up and owned a local retail business, she started to volunteer with the merchant’s association to revitalize the town’s main street. 

Lorain Francis

Fifteen years ago, Lorain and her husband moved to his hometown of Union, in an under-served area of coastal Maine, where Lorain found a job at the Chamber of Commerce in Rockland. That ultimately led her to the Maine Development Foundation, where Lorain got the chance to work with communities across the state, doing what she loved. However, after about five years working with Mainers near and far, Lorain began to feel disconnected from the last place she expected: the place she called home. “I realized that I lost my sense of my own community, because I was in everybody else’s community,” Lorain said. “I wanted to make a difference in my own community again, so the thing to do was to get involved locally.”

That’s when Lorain took a job at Penquis, a community action organization in Maine. At Penquis, Lorain helps to administer a federal AmeriCorps grant that places senior volunteers in eight food pantries and a soup kitchen in Mid-Coast Maine. Lorain is the program director for an initiative called Knox County Gleaners, which partners with local and backyard farmers and residents to harvest and redistribute fruits and vegetables to nearby food pantries. Last year, Lorain’s team helped to distribute over 22,000 pounds of vegetables to 22 locations in Knox County. 

It was about two-and-a-half years after joining Penquis that Lorain ultimately found what she calls her “volunteer job” at Come Spring Food Pantry, one of Knox County’s food pantries. Come Spring was started over 20 years ago as a community service project, and when the founder decided to retire, Lorain decided that, given her background in community building, she was the right person to step in and help the organization grow.  

A Lender To Dream With

Even before March 2020, Come Spring was bursting at the seams in its cramped, hard-to-find space located in the basement of a town building. The COVID-19 pandemic exacerbated those struggles. According to Lorain, not only did social distancing restrictions limit how many people could be present in the tiny pantry at any one time, but it was challenging for community members to access new pickup locations, even as need increased. To make matters worse, Lorain says that there wasn’t enough space to store surplus food, which meant that the nonprofit had to rent another room, which soon became a financial burden for the organization.

Come January 2021, Lorain knew what she needed to do: find a larger space. She and her team began to look around Union to see what was available. A few weeks later, she toured 27 Common Road. Despite that the 2,800-square-foot building was in major need of repairs (snow was falling through the roof), Lorain knew that it was Come Spring’s new home. The next obstacle? Figuring out how the small (but mighty) food pantry was going to be able to purchase it.

Lorain reached out to a colleague at AIO Food & Energy Assistance, another pantry that had just gone through a building campaign, to ask for advice. That’s how Lorain learned about a Community Development Financial Institution (CDFI) called The Genesis Fund. Since 1992, The Genesis Fund has been working to develop and support affordable housing and community facilities across Maine, mainly by providing both financing and technical assistance to increase the supply of affordable housing. CNote partners with CDFIs like The Genesis Fund in communities across the country, channeling capital to fund social missions like affordable housing, women’s empowerment, entrepreneurial funding, and more. 

When Lorain connected with The Genesis Fund, she instantly knew she found the right financing partner. Not only did the CDFI have an impressive portfolio of similar projects, but, as Lorain describes, the CDFI “dreamed with us as a fledgling pantry wanting to grow big.” The Genesis Fund offered Lorain and her team everything Come Spring needed, including assistance with the loan application and coaching. In the end, being challenged to think about Come Spring’s past, present, and future ultimately helped the food pantry to “grow up,” Lorain said. 

On February 12th, Come Spring made its purchase offer to the building’s owners, and, incredibly, the deal closed on March 31st — 64 days after Lorain and the CSFP Teams initial decision to move the pantry’s location. Meeting the March 31st deadline was significant, Lorain explained, because doing so meant that Come Spring didn’t have to pay taxes on the building for the next year. Therefore, the speed for which The Genesis Fund and the lawyers were able to help Come Spring close on its offer saved the food pantry $3,500. “For us, that’s huge,” Lorain said. “Genesis was amazing to work with. They believed in us from the beginning, and everybody pulled together and made it happen.”

Food Brings People Together

These days, Lorain has a lot on her plate. Once the real estate deal was finalized and the pantry secured its larger space, it was time to get to work. The first thing that needed to be done was to repair the building, namely installing a new roof. However, because Lorain wanted the new building to be a beacon for those experiencing food insecurity, it had to be painted barn red. The addition of “huge signs” helped to ensure that the building can’t be missed — it’s now visible more than a half-mile away.

Come Spring officially opened its new pantry on July 10th, 2021 and the location has quickly become a long-term food storage hub for other food pantries and food security groups in western Knox County. Besides the much larger food pantry and a big parking lot, Come Spring now has in its plans a storage room, a classroom, and a commercial kitchen, where volunteers can process food (e.g. make apple cider) and prepare take-home meals. The pantry Knox County Gleaners was also able to acquire a CoolBot, an energy efficient walk-in cooler, which ties back to the work that Lorain does with produce redistribution at Knox County Gleaners. Another way Come Spring has established itself as a community center is by hosting Union’s weekly farmers’ market, which consistently attracts large crowds. 

Today, Lorain and her team of volunteers open Come Spring to the community every Wednesday with both daytime and evening hours. In July the pantry will switch from pre-packed boxes to a client choice shopping model just one year after moving to the new pantry. Providing a small grocery store experience and atmosphere allows people to shop for what their families’ preferences are, she said. “It gives people choices, it gives them dignity, and it empowers them to be able to choose what they want.”

Since moving into its new facility, Come Spring estimates that it will be able to increase its capacity to provide services to additional families, including the elderly, couples, veterans, large and small families and anyone struggling with food security in the region. 

“We encourage people to come and get food basics from us and spend their saved income on gas, heat and to keep their car running so they can get to work and children to school. I don’t want anyone in my community to not know that there are food pantries here where anyone can get food,” Lorain said. “It’s a labor of love, and I love making sure that everybody in western Knox County is fed. It doesn’t get any better than that.”

Learn More

  • Come Spring Food Pantry is a food pantry in Knox County, Maine, with a mission of feeding their neighbors with dignity while promoting health, opportunity and hope.
  • The Genesis Fund provides innovative financing by soliciting investment loans from individuals, churches, corporations, and foundations, and then re-lending the money at favorable terms to nonprofit organizations developing affordable housing and community facilities for underserved people and communities throughout Maine and beyond.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

How Capital For Change Uses CNote To Create More Possibilities In Its Community

For the better part of 15 years, Charles Bodie worked for a large, multinational investment bank and financial services holding company, first in private wealth management, and later in credit risk. Although he enjoyed his work, when Charles relocated to New Haven, Connecticut nearly three years ago, he began to look for other employment opportunities. That’s how he learned about Capital for Change, the largest full-service Community Development Financial Institution (CDFI) in Connecticut. 

Charles Bodie, Capital For Change’s Chief Financial Officer.

While Charles didn’t initially set out to work in the CDFI sector, he says that he was attracted to Capital for Change because of its mission-driven practices. “The loans and other activities that Capital for Change do really make a difference for people that otherwise might not receive those opportunities from other financial institutions,” he said. “For me, that just meant so much.” In 2019, Charles became Capital for Change’s Director of Finance and Reporting, and he’s since stepped into the position of Chief Financial Officer. 

Capital for Change was created in 2016 after three established CDFIs — Community Capital Fund, Greater New Haven Community Loan Fund, and Connecticut Housing Investment Fund — merged into one. Today, each of Capital for Change’s programmatic, product, and service offerings are rooted in those founding CDFIs’ combined decades of experience and expertise. According to Charles, Capital for Change takes a diverse approach to lending, which centers around what the CDFI refers to as “The Core Four.” Those complementary missions include affordable housing, energy efficiency lending, loan servicing, and community development loans. “The need for affordable housing is paramount, but the fact that we can actually touch on multiple missions is even better.” Charles said. “The more we can do in more diverse ways, the better.”

Charles is especially excited about Capital for Change’s energy efficiency loans, which help homeowners to conserve energy usage and decrease costs through audits, retrofits, and alternative/clean energy improvements. Charles estimates that on the consumer side, the CDFI has originated more than $87 million in efficiency loans. These loans stem from various programs and funding initiatives — ranging from replacing 80-year-old oil furnaces to installing solar panels — led by Connecticut’s Public Utilities Regulatory Authority. Because the state utilities cannot be a lender , the utilities funds are “farmed out” to various lending organizations, including Capital for Change. “The utilities created the products, and what we do is we bring the consumers together with the contractors that can do the work and use the utilities’ money,” Charles said. “We’re the ones who bring all of that together.”

Capital for Change also offers multifamily energy loans through a program called LIME (Low Income Multifamily Energy), in which the CDFI works on a project-by-project basis with property owners to make energy efficiency improvements to multifamily properties and condominium developments that meet certain requirements (e.g. no fewer than 5 units and at least 60% of units affordable to households at no higher than 80% of Area Median Income). According to Charles, to make those loans work, the CDFI treats the energy efficiency updates as a kind of collateral. “If we know that you’re going to save, say, $50,000 in maintenance and utility costs over the next 10 years,” he explained, “then when we put these improvements in place, you pay it back to us with those savings. It’s a novel way to approach energy efficiency lending.”

Charles shared an example from a recent project in Bridgeport, Connecticut. A partner organization constructed a charter school on an old manufacturing site, and Capital for Change funded an energy efficiency refurbishment. Capital for Change worked with a company to install a fuel cell so that the school, housing for tutors, and a future housing project would be able to generate its own electricity. “We funded the fuel cell project when no one else would,” Charles said. “That one project in and of itself is a real boon for a CDFI like us because it touched on education, energy efficiency, housing, and urban blight, and it’s been phenomenally successful.”

It’s with that same kind of diversified lending approach and multi-faceted mission orientation that Capital for Change is looking to the future. Specifically, Capital for Change is interested in piloting a small business lending program in the next year or two. Most of the CDFI’s current business loans are greater than $100,000; however, if piloted, Charles said that Capital for Change might offer loans as low as $5,000 to small business owners. Additionally, Capital for Change is considering new ways to find out what its community needs, mainly through survey work and collaborations with community organizations. “Traditionally, we didn’t ask anybody about needs because we know there’s a need for affordable housing and energy efficiency,” Charles explained. “But, what is it that we don’t know? What are we missing? That’s where getting in touch with the community is really important.”

 

‘CNote Wants Exactly What We Want’

Given the diverse nature of Capital for Change’s work, the CDFI is able to get funding from diverse investors, including banks and the state; as is the norm, those dollars come with usage restrictions related to programs or loan types. While Charles and his team are appreciative of every loan and investment that flows into Capital for Change, he says that working with CNote changes the paradigm. “CNote wants exactly what we want, and they follow our mission,” he said. “Because so much of the funding that we receive is specific to project or loan type, there are only certain loans that qualify; but, everything can be funded with the money that CNote provides, and that’s been an excellent resource.”

Charles said that funds that come into the CDFI through CNote’s Flagship Fund create myriad possibilities for Capital for Change. For example, with CNote dollars, Capital for Change can free up capital from existing loans. That means that Capital for Change can replace money in one of its current loans with CNote money to free up capital for another loan. According to Charles, that creates other possibilities for the CDFI, including passing the benefits on to its clients by lowering interest rates on future loans.

Additionally, Charles has found that working with CNote has lightened typical CDFI reporting requirements, freeing up administrative time and costs so that he and his colleagues can focus on perpetuating Capital for Change’s missions. “CNote has really filled the space for CDFI borrowers like us,” Charles said. “For traditional banks, our world is a bit alien to them, but for CNote, they’re showing that lending evolves. They’re at the forefront of that evolution, and that’s another aspect that makes our partnership with them work really well.”

Learn More

  • Capital For Change is the largest full-service Community Development Financial Institution (CDFI) in Connecticut.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

Easy As C-C-C: How Access to Capital for Entrepreneurs Uses Capital, Coaching, and Connections to Help Georgia’s Small Business Owners Thrive

Martina Edwards knows what it’s like to be given an opportunity to break down barriers. Thanks to a nonprofit that helps place high-achieving graduates of color in Wall Street firms, Martina started her career in 2001 and became Merrill Lynch’s first Black female broker on the floor of The New York Stock Exchange in 2004. She spent the next 10 years working on and off Wall Street, including time running the alternative investments program for the same organization that helped her land her job at Merrill Lynch. According to Martina, that’s when she truly began to understand the importance of capital, particularly in terms of creating generational wealth and economic growth.

Eventually, Martina returned to her southern roots and moved to Atlanta, where she started to reflect on what she wanted to do long term with her career. She knew she wanted to be on the forefront of working with minority women in business enterprises, but she didn’t know exactly what that might look like. That’s when Martina found herself listening to a panel discussion featuring Grace Fricks, the founder and CEO of Access to Capital for Entrepreneurs (ACE), a Community Development Financial Institutions (CDFI). Grace started ACE in 1997 in rural northern Georgia with an initial grant of $50,000 to support small business owners across the state. Like many financial services professionals, Martina wasn’t aware of CDFIs when she worked on Wall Street; however, as she learned more about ACE’s impact, especially with women business owners, she knew she wanted to get involved. 

Twelve months later, Martina joined ACE’s team as the CDFI’s chief of strategic partnerships. For the past three years, Martina’s main focus has been fundraising so that ACE can create more access to capital for small business owners. “We give folks a chance when others can’t or won’t,” said Martina. “But it’s not just helping one small business owner. When we create financial security for a business owner, that creates more financial security for their employees, and that allows their households to thrive.”

The Three C’s

ACE is the largest small-business-oriented CDFI in Georgia that focuses on women, people of color, and low- to moderate-income business owners. An important part of the organization’s mission is to decrease the gender and racial wealth gaps, particularly for Black and Latinx communities who continue to face the racial discrimination inherent to our modern financial systems. Importantly, ACE’s staff is a reflection of the ethnically diverse communities that the CDFI serves, and Martina and her colleagues live in rural, suburban, and urban communities throughout North Georgia. That representation is essential, especially as ACE works to build trust with small business owners who’ve traditionally been overlooked and undercapitalized by traditional lenders.

 

Like all CDFIs, ACE is mandated to deploy at least 60% of its capital to its target markets. While ACE has historically funneled at least 80% of its capital into those markets, in 2021, the CDFI managed to bring that percentage up to 94. Martina credits those percentages to intentionality on the part of her and her colleagues, but also to the geographic footprint in which ACE operates. ACE’s headquarters is in Cleveland, Georgia, a rural town of fewer than 4,000 residents, and while the CDFI supports metro hubs like Atlanta and Savannah, it also works in suburban counties such as Gwinnett, which is the most diverse county in the Southeast. In total, over the past 22 years, ACE has provided loans and business advisory services to support more than 2,000 small business owners across 68 counties in Georgia. 

According to Martina, ACE’s target demographic of small business owners face a host of challenges, including a knowledge gap, a capital gap, a trust gap, and, more often than not, a social capital gap (i.e. the lack of a network) — all of which are rooted in decades of inequality. To address these challenges, ACE employs what it calls the three C’s: capital, coaching, and connections:

1. Capital. Lending is at ACE’s core, and the CDFI offers small business loans (up to $50,000) and commercial loans ($50,001 to $1 million). However, ACE also collaborates with other organizations to deploy capital in different ways. Such creative collaborations have focused on interest rate buy-downs, loan guarantees, and longer term limits. ACE also participated in a number of initiatives that emerged during the COVID-19 pandemic, including the Southern Opportunity and Resiliency (SOAR) Fund, a program that matches small business owners with CDFIs across 15 states and Washington D.C.

ACE was actually able to increase its lending during the pandemic. In fact, between 2020 and 2021, ACE deployed more capital than it had in the previous five years combined. ACE was able to do this, in part, through the Paycheck Protection Program (PPP). In 2020, ACE lent just over $25 million, $4.5 million being PPP loans. In 2021, those numbers grew to $37.3 million and $10.5 million, respectively. Of the $10.5 million PPP dollars deployed in 2021, 54% went to women and $68% went to Black borrowers. Overall, 90% of ACE’s PPP loan recipients had five or fewer employees, and many were sole proprietors. “There were businesses that were on the brink,” Martina said. “Through the PPP process, we were able to stand with them in the gaps. We were really blessed to have great long-term relationships with lending partners like CNote that were willing to lend us low-cost capital that we specifically needed for PPP loans.”

2. Coaching. ACE knows that the key to growing sustainable businesses is to pair capital with coaching. As Martina puts it, “you got the capital, but what do you do with the capital?” To help small business owners answer that question, ACE has a growing team of business advisors who work hand-in-hand with entrepreneurs. ACE currently has a six-to-one client-to-employee ratio, which helps to explain why the CDFI’s default rates are typically  under 2%. In 2021, the CDFI dedicated more than 18,000 hours to business consulting. ACE’s “high-touch” approach, as Martina describes it, is especially centered around financial operations, business operations (e.g. cybersecurity best practices and human resources), and resiliency. “There’s relief, there’s recovery, and there’s reinvention,” she said. “We want our borrowers to be better operators, to be stronger, and to be sharper around those particular skill sets.”

3. Connections. Because ACE knows that many of its clients don’t have a network of other small business owners to rely upon, it strives to forge connections, whether between entrepreneurs or to resources. The CDFI has two women business centers that are certified through the Small Business Administration. It’s important to note that each women’s business center is gender agnostic and open to everyone. Although business coaching is an integral part of these hubs, these spaces are an ideal place for ACE to host lunch and learns, webinars, and training workshops. For example, in the wake of the COVID-19 pandemic, ACE partnered with LinkedIn to train local entrepreneurs how to pivot their brick-and-mortar businesses to e-commerce marketplaces.

ACE also offers small business owners the opportunity to participate in four different cohorts depending on where an entrepreneur is with their business at a given point in time. “As a business owner, it can be a lonely world,” said Martina, “and sometimes you feel like you’re the only person going through something. At the end of the day, it’s helpful to give small business owners a network of people that they can depend on, rely on, learn from, and possibly cross pollinate and share ideas.” 

Unlocking Opportunities

ACE recently engaged a strategic planning firm to help determine long-term strategy. In the coming years, Martina says that ACE sees a unique opportunity  to deepen their work and expand operations across Georgia, and the CDFI believes it can  deploy $100 million in capital to support women, BIPOC, and low- to -moderate income business owners in the next three to five years. Should the CDFI achieve its goal, it will be a noteworthy accomplishment: in its entire 22-year existence, ACE has deployed $140 million in capital. Martina notes that investments in improving the capacity of our people, technological infrastructure, and capital resources will be critical given the overwhelming volume of demand and the speed at which clients need capital. To set itself up for success, she says that ACE will establish new partnerships and deepen current ones. For example, ACE is a CNote Wisdom Fund Partner, which has given the CDFI access to a targeted pool of funds to further its lending. “Our mission is growing sustainable businesses, but the vision is also closing  wealth and opportunity gaps,” said Martina. “The Wisdom Fund is supporting us so that we’re able to do that.”

Additionally, just like ACE offers its clients an opportunity to network, Martina says that CNote has helped ACE connect with peer CDFIs across the country who’ve shared best practices, strategies, and ideas that have helped to make ACE more efficient. Similarly, ACE has gained visibility from CNote’s platform, which attracts impact investors, donors, and individuals from localities well beyond Georgia’s borders who want to support women business owners. “I feel like we’re the best kept secret, but we don’t want to be the best kept secret,” Martina said. “That’s why CNote is such an instrumental partner for us beyond capital, because CNote can talk about us in rooms that we don’t necessarily get access to.”

Learn More

  • Access to Capital for Entrepreneurs (ACE) is a Georgia 501(c)(3) nonprofit and community development financial institution (CDFI) that provides capital, coaching, and connections to help borrowers create and grow sustainable businesses that generate jobs.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.

 

By Community Partners

Meet Education Credit Union, Whose Scholastic Roots Sprout Innovative Programs In The Texas Panhandle

While Education Credit Union (ECU) may be 86 years old, it’s finding new ways to empower its community in Amarillo, Texas. Founded in 1935, the credit union was originally named Amarillo School Employees Credit Union, and it catered to teachers and administrators in the district. However, in 2010, the credit union rebranded itself and dropped the requirement that members had to work in education. Rebrands, however, can come with a steep learning curve, and ECU soon discovered that it had to come up with new approaches to connect with new members.

To help educate community members that they don’t have to be employed by a school to join the credit union, in 2020, ECU decided to pair its decades-old brand recognition with a new tagline: “Learn More, Live More ®.” According to Eric Jenkins, ECU’s CEO, those words say it all. “We’re staying true to our scholastic roots, because we wouldn’t exist without the educators who founded us,” he said, “but the ‘education’ part of our name is we are striving to teach consumers financial responsibility and wellness so that they can live more.”

The new tagline seems to be working. Today, the credit union has seven branches (with another one on the way), and it serves more than 30,000 members in a 16-county radius. Like many financial institutions, ECU offers its members a variety of services, including checking accounts, savings accounts, and loans. Additionally, it offers free financial education classes focused on all ages from preschool to adults. However, what separates ECU from traditional lenders and other credit unions is its array of innovative, community-centric programs. 

Eric Jenkins, the CEO of Education Credit Union

Here’s a look at four of ECU’s most unique offerings:

1. New Teacher Loans: True to its roots, one of ECU’s flagship services is new teacher loans, which are offered to recently hired educators who have yet to receive their first paycheck. Because it can take upwards of six weeks to receive that first paycheck, the credit union wanted to provide new teachers with a non-credit score based product to help fill that gap and allow those employees to meet whatever financial needs they have during that time. 

2. AmTech Career Academy: This past fall, the Amarillo School District opened up a state-of-the art, 231,000-square-foot vocational campus called AmTech Career Academy. The academy is dedicated to training more than 2,800 high schoolers to pursue one of 37 career paths, free of charge. In early 2022, ECU will not only open its first branch inside an Amarillo School District school, but it will staff that branch with senior apprentices from AmTech’s School of Business, Marketing, and Finance. These students will be hired as paid interns, and they’ll receive high school credits while they gain valuable financial services experience that could one day translate into a full-time role with a credit union or bank.  

3. BUFF $MART Program: In partnership with West Texas A&M University (whose mascot is a buffalo), ECU launched a financial literacy boot camp designed for college students. Since 2018, more than 300 students have gone through the program, and many of those participants actually received college credit for completing the coursework. Additionally, graduates of the program are invited to return and help lead future iterations of the boot camp. According to Eric, this program could easily be replicated by other credit unions that serve university partners in their footprint. “You would think that college students would have a base level of education on financial services,” he said,” but it’s discouraging how little many know about basic things like how checking accounts and credit cards work. These are smart kids from diverse backgrounds and it is so rewarding to see them benefit from what in reality is financial success training.  We really hope other credit unions will build similar programs and stand ready to support those efforts and share our lessons learned.

4. Pocket Change Grants: ECU takes team members giving back to the community to another level and focuses on the importance from day one of employment. As a result, more than 98% of ECU employees donate a portion of their paychecks to help fund Pocket Change Grants. The credit union’s board matches all contributions, and every year, ECU awards grants up to $500 to local teachers to purchase learning tools, address students’ basic needs, or fund activities and field trips. Notably, grant recipients do not have to be members in order to be eligible to receive funding from ECU. Since the program was launched in 2009, ECU has donated more than $500,000 to school districts across the Texas Panhandle. In 2021 alone, ECU donated $149,753 to 325 local teachers. 

For Lindsey Murphy, ECU’s senior vice president of marketing and business development, Pocket Change Grants are arguably her favorite part of her job. Lindsey grew up in the community, and her mother was a teacher in the Amarillo School District. As soon as Lindsey turned 16 and got a job, her mom drove her to ECU to open her first checking account. All these years later, she feels blessed to be able to give back to local schools in such a meaningful way. “It’s so rewarding to see the smiles on our team members’ faces when they get to go into the schools and deliver the checks,” Lindsey said. “Every employee that donates gets the opportunity to go out and physically deliver one to a teacher and enjoy that experience and see that donation go to work.”

Lindsey Murphy, Education Credit Union’s senior vice president of marketing and business development

According to Lindsey, ECU is able to come up with and deliver on such unique programs because, collectively, her and her colleagues have their fingers on the pulse of what’s going on locally: not just in the area school districts, but holistically in the surrounding communities. Recently, that heightened level of awareness led ECU to be more intentional about attracting and recruiting bilingual employees who can better serve the credit union’s Spanish-speaking members. After strategizing with its HR team, ECU updated its job posting preferences, created an all Spanish ad and translated one of its job applications into Spanish. The credit union’s efforts were rewarded: 40% of its new hires are bilingual. “We knew that in order to effectively serve the communities where we exist in the language that they need, then we were going to have to make changes,” Eric said. “We had to be intentional, and we’re going to continue to make that a priority.”

As ECU continues to strive to look more like the community it serves, both Eric and Lindsey are excited for what’s to come for the credit union. As they look forward to exciting announcements in 2022 and beyond, one thing is clear: after 86 years, ECU’s best years are still ahead of it. “We have the opportunity to create more value for consumers in the Panhandle of Texas than any other institution here,” Eric said. “Like I said before: we’re going to help people learn more about their financial lives so that they can make their whole lives better.”

Learn More

  • Education Credit Union’s mission is to excel in service, care and financial protection for members and their families. The Education Credit Union proudly serves members in Amarillo, Bushland and Canyon, Texas.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

How Toni Hopkins Embraced Her Entrepreneurial Side To Open Cool J’s Apparel During The Pandemic

In the years leading up to the COVID-19 pandemic, Toni Hopkins and her husband talked about moving from their home in Springfield, Illinois to North Carolina to pursue what she describes as “something different.” They’d even gone as far as to meet with a real estate agent to explore selling their house. Ultimately, the couple abandoned their plans to pursue a fresh start at the onset of the pandemic. However, Toni’s desire for “something different” persisted. That’s when she began to listen to the entrepreneurial voice in her head that had spent the past three years telling her to start her own business.

Toni Hopkins, Founder of Cool J’s Apparel.

For Toni, the idea of opening her own business was something of a fantasy. After more than 18 years working in accounting and finance, she was tired of the monotony. Over her career, she’d heard people — coworkers, friends, family members — vocalize wanting to do something different with their lives but never acting on those wants. Toni’s problem was that she knew she wanted to start a business, but she didn’t know what kind of business she wanted to start. She’d even stumbled across a vacant commercial space near her home in Springfield that she determined would be perfect for her nameless, yet-to-be-created future store.

During the early weeks of the COVID-19 pandemic, when stay-at-home mandates went into effect and Toni began to work from home, something changed inside of her. Not only did she and her husband decide to stay planted in Springfield, but that’s when she decided that she was going to shift from talking about opening her own business to actually making it happen. “The pandemic hit, and I said ‘okay, this is the time for me to actually do this,’” she said. “Like everybody else, I started working from home, and I realized that I could be doing something else with my time that I wanted to do instead of pushing numbers.”

Fortunately, Toni was surrounded by a supportive husband, daughter, and son who encouraged her to embrace her entrepreneurial side. She set her fears aside and began to look for the right business opportunities in her community. It didn’t take her long to connect the dots between one of her passions — fashion — and the fact that there weren’t many black-owned clothing boutiques in town that sold trendy yet affordable clothes and accessories. Toni had found her business idea: Cool J’s Apparel. Amazingly, the “perfect” commercial space that she’d seen from her car window a year earlier and fallen in love with was still available. Even more amazing was the fact that Toni was able to work with the landlord to sign a lease.

Falling Into Place

According to Toni, every aspect of her business seemed to effortlessly fall into place. Through her research, she’d learned that women were continuing to purchase clothing during the pandemic and that boutiques like the one she wanted to open continued to be profitable amidst the wide-scale economic uncertainty. That helped to shape the business plan that Toni wrote and carried with her to her local bank to apply for a small business loan. Although the banker told Toni that he couldn’t help her because the loan request wasn’t big enough, he told her to reach out to Justine PETERSEN, a Community Development Financial Institution (CDFI) that offers a variety of financial tools and service to help low- and moderate-income individuals and families achieve their personal financial goals. CNote partners with CDFIs like Justine PETERSEN in communities across the country, funding loans and empowering local entrepreneurs like Toni through CNote’s Flagship and Wisdom Funds.

Toni reached out to the CDFI in November 2020, and she quickly connected with Aida Richardson, Justine PETERSEN’s chief lending officer. “Aida was so helpful from the very beginning,” Toni said. “She just knew so much, which was the biggest help. This was my first time opening a business, but she’d done this hundreds of times, so Aida just made it so easy. She answered all of my questions and emails and didn’t hesitate to always point me in the right direction.”

With micro-enterprise lending from Justine PETERSEN, Toni was able to do everything she needed to open Cool J’s Apparel on May 28, 2021. According to her, the loan money from the CDFI helped her with every aspect of her business, from paying rent to completing renovations and from purchasing inventory to buying the iPad that she uses to complete sales. Additionally, Toni says that the CDFI helped her to make her business “become legit and successful,” meaning she was able to leverage those loan dollars to invest in marketing, advertising, and signage. Most importantly, even though Toni received her small business loan roughly 12 months ago, Aida and her colleagues at Justine PETERSEN continue to tell Toni that they’re always available whenever she needs anything, whether that’s a quick question that can be answered over the phone or ongoing technical assistance to help take her business to the next level. 

Unsurprisingly, Toni’s positive experience with Justine PETERSEN is largely why she describes opening Cool J’s Apparel as “so easy.” In the process, she’s inadvertently become one of the CDFI’s biggest cheerleaders. “I’ve been telling everybody about them,” she said, laughing. “They’ll let you know right away if they can help you or not, and if they can’t, then they’ll put you on the right path and they’ll give you the steps to help you. It’s a relationship that I’m really appreciative of, even today.”

‘I Love Doing What I’m Doing’

Although the COVID-19 pandemic couldn’t deter Toni from opening Cool J’s Apparel in May 2021, it did limit her ability to have a grand opening celebration — something she’s considering remedying in the coming weeks. That doesn’t mean that the women’s clothing store where “cute meets comfortable” has struggled to find its footing in Springfield. Business is going well, and Toni says the store enjoys support from both local customers and shoppers who drive down from Chicago. The broad geographic interest in Cool J’s Apparel stems from the fact that Toni carries stylish yet affordable clothes and accessories for all ages. “My customers are Black and white, young and old, and just really diverse,” she said. “I’m not joking. It’s craziness. I don’t know how people target one specific group, because I have such a big range of customers here.”

Cool J’s Apparel even attracts the occasional male customer, which has prompted Toni to consider incorporating a menswear section into her store — or perhaps into a larger location. In the nearterm, Toni would like to hire some help. Currently, Toni operates the store while she continues to work her part-time, remote nonprofit job, and although she appreciates the help she gets from her family, including her niece, she wants to either hire two part-time employees or one full-time staff member as soon as she’s able to. Additionally, Toni is interested in deepening her small business’ connection to the surrounding community, such as sponsoring events where all proceeds go to donating backpacks to the local school.

Even though Toni has the occasional quiet day at Cool J’s Apparel, she’s pleased knowing that when customers do come into her boutique, they tend to walk out with a bag of new clothes. “People that have never been my customers before, they come in and they find something that appeals to them,” Toni said. “I love that. Even on slow days, I still love being here and doing what I’m doing.”

Learn More

  • Cool J’s Apparel
  • Justine PETERSEN is a CDFI that connects institutional resources with the needs of low-to-moderate-income individuals and families in Missouri, helping them to build assets and create enduring community change.
  • CNote – Interested in helping create another story like this? CNote makes it easy to invest in great CDFIs like Justine PETERSEN, helping you earn more while having a positive impact on businesses and communities across America.
By Borrower Stories

How Project Fighting Chance Is Going Beyond The Boxing Ring To Build Trauma Resiliency In San Bernardino’s Youth

When Terry Boykins was first approached to serve on the board of directors for a nonprofit called Project Fighting Chance, the social entrepreneur politely said “thanks, but no thanks.” It wasn’t because Terry wasn’t aligned with Project Fighting Chance’s mission to function as a viable safe space and trauma resilience support system for youth in San Bernardino, California. Terry’s own work was similarly rooted in community engagement; however, his background was admittedly in the corporate world, and Terry was hesitant to get involved with a nonprofit. 

Terry Boykins

A few years later, in 2016, Terry got his next offer to consider joining Project Fighting Chance’s board, just months after a terrorist attack left the community — and the country — in shock. This time, Terry visited the organization, he spoke with current board members, and, most importantly, he saw the nonprofit’s potential. Terry joined the board, and a year later, he stepped in as the organization’s interim executive director. In July 2020, he dropped the “interim” label and became the nonprofit’s full-time executive director.

One of the reasons that Project Fighting Chance was established in 1999 was to give youth a safe place to go after school. According to Terry, the hours between 3 p.m. and 7 p.m. are the most deadly for young people, especially in San Bernardino, the second-most dangerous city in California. That’s why the nonprofit opened its doors: to create a place for students to escape the pervasive poverty, food insecurity, prostitution, drugs, violence, robberies, car jackings, and home invasions around them. “When you talk about PTSD in the hood, it’s here,” Terry said. “These students are trying to navigate an environment where they’re confronted by violence and destruction on a daily basis, so we created a space for them to get away from that, where they can focus on their academic well-being, their emotional well-being, and getting an afternoon meal five days a week.”Since its inception, Project Fighting Chance has built itself a championship reputation within the national amateur boxing community. For example, in 2018, PBS released a docu-series following three of the nonprofit’s top boxers. However, when Terry came onboard, he set out to expand the organization’s programmatic offerings beyond boxing. “The boxing program was already a place where kids wanted to go,” he said, “but I’d been focusing on the obstacles that youth were confronted years down the road. I asked ‘what exactly can be done that will help these young people apply the techniques of boxing as they relate to overcoming issues or struggles or problems to get somewhere else in life?’ That’s when we began to have a different dialogue.”

Through that “different dialogue,” Terry and his colleagues at Project Fighting Chance have put together a dizzying assortment of programmatic offerings for youth between the ages of eight and 18 from San Bernardino and the surrounding communities. While boxing and workouts are still an integral part of Project Fighting Chance, the nonprofit has expanded to offer additional after-school enrichment programs like chess, art classes, horticulture, tutoring, and spoken word. There’s also a mental-health tranquility garden, where students can sit outside and eat lunch, meet with a counselor, or learn about nutrition. Additionally, the San Bernardino City Unified School District helped the nonprofit secure 40 guitars — a mix of acoustic and electric — for its Guitars Not Guns program. “We have a trauma-informed staff, so we understand who’s coming in the door,” Terry said. “It’s a very interesting time here when the guitar instructor and the students are able to come together through music to deal with some social-emotional dynamics that happened in their day.”

Going Toe-to-Toe With A Global Pandemic

Every Monday through Friday, Project Fighting Chance welcomes roughly 120 students through its doors, and in its 22-year existence, it has trained and mentored over 6,000 youth, free of charge. However, the nonprofit’s ability to fulfill its mission was thrown into question at the beginning of the COVID-19 pandemic. With both uncertainty around the virus’ transmission and state-mandated stay-at-home orders, Project Fighting Chance had to close its doors to the youth who needed it most. To make matters worse, much of the grant money that Project Fighting Chance relied on was retracted, which meant that the nonprofit was in immediate need from the Paycheck Protection Program (PPP) to keep afloat. 

Fortunately, a pastor from a nearby church referred Terry and his team to Self-Help Federal Credit Union. Self-Help is a low-income designated credit union that was chartered in 2008 to build a network of branches that serve working families and underserved communities. It currently has more than 78,000 customers across 19 branches in California, 10 branches in Illinois, and one branch in Wisconsin, and it has over $1.2 billion in assets. Like many credit unions in the U.S., Self-Help rose to the challenges presented by PPP loan issuance and forgiveness and acted as an economic shock absorber for the economy. CNote partners with low-income designated credit unions like Self-Help across the country through its Impact Cash Solution. 

Thanks to Self-Help, Project Fighting Chance applied for and received two rounds of PPP loans, which meant that the nonprofit did not have to lay off any of its six employees. The PPP funding also kept fuel in Project Fighting Chance’s tanks — literally. For the first 18 months of the pandemic, the nonprofit used its two vans to deliver 170 meals every day to youth around San Bernardino, ensuring that those experiencing food and transportation insecurity at home could still be served. “The PPP funding proved critical, because it allowed us to repurpose the organization to support young people and their parents in the community,” Terry said. “We were the place they could count on every day, and we basically got those funds and invested them into the community to make sure that we could stay available to these youth.”

Life Outside of the Boxing Ring

Although Project Fighting Chance had to limit its daily capacity to 15 students at the beginning of the pandemic, today, Terry and his team are back to serving over 100 youth a day. Despite the extended time away from face-to-face interactions, programmatically, Project Fighting Chance didn’t miss a beat during the pandemic. In September 2021, for example, the nonprofit kicked off a program called Civil Liberties for Boys of Color, where students got to speak with law enforcement officials — police officers, probationary staff, employees from the district attorney’s office — for 90 minutes every Friday. “These were real conversations,” said Terry. “These kids were scared of the police and not knowing if they’re going to make it back home today. So these folks came in and talked about the law, about behavior, and they talked to these young boys about having a voice for their concerns about living in their communities.”

To say that Project Fighting Chance has become much more than a place for youth to learn about boxing is an understatement. Today, youth are exposed to programs related to nutrition, mental health, sex trafficking, partner violence, civic engagement, and career development. Whether or not a student walks through the nonprofit’s doors wanting to be the next Muhammad Ali or the next Jimi Hendrix, they’re encouraged to train in the boxing gym, visit the tranquility garden, talk about mental wellness, and explore every aspect of STEAM (science, technology, engineering, arts, and math). 

Why? According to Terry, it’s not only about reducing childhood violence, trauma, and food insecurity, it’s about preparing these youth to be productive members of society. That means developing the coping skills to thrive in the labor force and the civic engagement skills to become informed voters and taxpayers. Therefore, it isn’t surprising that Terry’s most exciting day as executive director of the nonprofit was when he and the youth at Project Fighting Chance were invited to attend a San Bernardino City Council meeting to learn about how local government works. The organization filled every seat in the house, and, as Terry put it, the students got “a lesson outside of the boxing ring that was priceless.

Whether it’s local council members, California state assembly members, school district administrators, teachers, mentors, counselors, therapists, coaches, parents, or credit unions like Self-Help, Terry is quick to acknowledge the broad community support and partnerships that Project Fighting Chance not only enjoys, but relies upon to be successful. “We are not where we are because we’re doing great things,” Terry said. “We are where we are because there are some great people helping us do some very good things after school in this community.” 

Learn More

  • Project Fighting Chance‘s Mission is “to function as a viable safe space and trauma resilience support system for youth and young adults at-progress while assisting them to become positive contributing members of the community.”
  • Self-Help Federal Credit Union was chartered in 2008 to build a network of branches that serves working families and underserved communities. Serving more than 78,000 members, Self-Help Federal is one of the fastest-growing low-income designated credit unions in the country. 
  • CNote – Interested in helping create another story like this? CNote makes it easy to invest in great Credit Unions like Self-Help, helping you earn more while having a positive impact on businesses and communities across America.
By CNote

Impact Platform CNote Announces Conversion to Public Benefit Corporation

New legal designation affirms CNote’s longstanding commitment to closing the wealth gap and uplifting communities with sustainable solutions.

 March 30, 2022 // Oakland, CA // CNote, a woman-led impact platform, has announced its official conversion to a Public Benefit Corporation (PBC).

 Since its founding in 2016, CNote’s fixed income and cash products have streamlined millions in scalable investments from individuals and corporations. Dollars invested and deposited on the CNote platform are deployed with mission-driven financial institutions to fund underserved communities and BIPOC entrepreneurs in line with the firm’s mission to close the wealth gap.

A supermajority of CNote’s stockholders voted to formalize a transition to a PBC, further aligning the company with its practice of enhancing equitable community development through financial empowerment. CNote’s specific public benefit purpose is to advance greater economic and social justice for underserved communities by unlocking access to impact investments. Now, unlike traditional corporations that primarily focus on maximizing only shareholder value, CNote can also ensure that decisions are made in light of achieving this specific purpose.

“Becoming a Public Benefit Corporation has allowed the company’s charter to reflect CNote’s core values that motivate us every day,” said Yuliya Tarasava, COO and co-founder of CNote. “This conversion means CNote will always be pushing for greater capital access for underserved groups that have long been neglected by the financial mainstream.”

As a Delaware Public Benefit Corporation, CNote’s Board of Directors will have a mandate to balance the economic interests of stockholders with its stated public benefit purpose, allowing it to take into account the material interests of all stakeholders affected by the company’s operations, including the underserved communities CNote supports and CNote’s partner financial institutions, clients, and employees.

 

About CNote

CNote is a women-led impact platform on a mission to close the wealth gap through financial innovation. Using the power of technology and a community-first framework, CNote enables corporations and individuals to efficiently invest at scale in fixed income and time deposit products that further economic equality, racial justice, gender equity, and climate change initiatives. As part of its offering, CNote delivers regular reporting on the social impact of deposits and investments made through its platform. A Certified B Corporation, CNote was a B Lab “Best for the World” honoree in 2019 and was named “Best Women-Owned Business” by the United Nations’ Women’s Empowerment Principles program in 2020.

By Community Partners

Meet Michelle Corson, ‘The Car Lady’ Behind the CDFI That Gets Clients On the Road

Since she was a little girl in Texas, Michelle Corson has always loved cars, something that befuddled her parents. “It’s not like I was chauffeured around town or anything,” Michelle laughed. “My mom drove a Honda and my dad drove a Buick, and they were like ‘who are you and why do you like cars so much?’” Despite her inexplicable interest in automobiles, Michelle decided to pursue a career in finance, investing, and real estate development. However, after 25-plus years of carving out a successful path for herself in that world, Michelle had the epiphany that many 40-somethings experience: she wanted to do something different.

Michelle Corson, founder and CEO of On The Road Lending- Photo Credit: On The Road Lending

That something different turned out to be launching an impact investing company called Champion Impact Capital in 2011. According to Michelle, she’d read an article earlier that year about impact investing, and she thought the idea of leveraging investment capital to solve problems was brilliant. With that, she began to look at issues that could be addressed using creative finance, which brought her full circle back to her childhood obsession: cars. Through her initial research in 2012, Michelle discovered that no one was working on transportation, despite the fact that having access to a personal vehicle provides people with better access to food, healthcare, education, and employment options. 

The statistics were eye-opening. Michelle learned that, on average, it takes people five times longer to get anywhere on mass transit than it does in a car in the United States. Similarly, according to an Urban Institute study, unreliable transportation is the number one reason for people losing their jobs. Additionally, people who have their own car are twice as likely to get a good job and four times as likely to keep it as someone without a vehicle. Michelle learned so much about mass transit that she wrote a book on the subject so that she could share her findings with others. “I think that sometimes we focus on the wrong things when we’re trying to solve problems,” Michelle said. “We’re so focused on the end, that we make things unnecessarily hard when it can just be a simple, practical solution.”

Michelle Corson at a client car delivery. Photo Credit: On The Road Lending

With that practical-solution mindset, Michelle launched On the Road Lending in March 2013, which seeks to get affordable, fuel-efficient, and safe cars into the hands of people who don’t have them, freeing them from things like unreliable or nonexistent mass transit, broken down cars, predatory buy-here-pay-here salesmen, and their own two feet. Michelle quickly earned herself the nickname “The Car Lady,” which she couldn’t find more fitting. “I love cars,” she said, “and I love getting people on the road to a much better life. Cars change everything for people who don’t have them.”

Putting Character-Based Lending in the Fast Lane

Over the past 10 years, with Michelle behind the wheel, On the Road Lending has gone on to become an officially designated Community Development Financial Institution (CDFI), thus cementing the organization’s mission to strengthen communities. Unsurprisingly, because On the Road Lending’s clients are transportation challenged, Michelle and her team do everything online, including reviewing and signing loan documents. To date, the organization has expanded its footprint to four states to include Texas, Alabama, Georgia, and Mississippi. While Michelle says that client acquisition is the hardest part of her business, she and her team are focused on forging more partnerships with trusted intermediaries like social service agencies, employers, and churches who can help assuage the fears of those who’ve previously fallen victim to predatory lenders and who’ve developed an understandable wariness toward anyone who says “we’ll cut your car payment in half.” 

Despite those hurdles, Michelle is confident that On the Road Lending is connecting with the right clients: more than 90% of On the Road Lending’s clients are people of color, and 65% of its clients are single Black mothers. On average, the CDFI’s clients have an average credit score of roughly 500, meaning that the interest rate for most of its clients for a car loan would typically be between 21% and 28% on a car loan. However, because On the Road Lending takes a holistic, character-based lending approach instead of relying on credit scores, it’s able to offer clients a flat interest rate of 9.75% for all of its loans, which cuts monthly payments from $700 to about $350. Compared to predatory lenders’ average default rate of roughly 30%, On the Road Lending’s default rate hovers around 3%. “With a client-equity-focused mindset, we start from an assumption that people are going to succeed instead of that they’re going to fail,” Michelle said. “Banks and traditional lenders don’t do that, but if they did, that would be a game changer for our economy.” 

Photo Credit: On The Road Lending

Besides reasonable loan terms, compassion, and flexibility, there’s another reason why Michelle refers to On The Road Lending as a “second-chance factory:” clients are paired with financial coaches who work with them on an ongoing basis. These remote, judgement-free consultations are complemented by online financial literacy classes that every client has to take. According to Michelle, the overall goal is to help clients distinguish between financial needs and wants and to be able to understand how to make important financial decisions in the future, whether that’s purchasing a home or going to college.

A Green Light to Grow

On the Road Lending has come a long way since making 16 loans in its first year; according to Michelle, the CDFI has been asked to expand into almost every state in the country, including localized requests from cities like New York City, Chicago, and San Francisco that have robust mass transit systems yet see the value that On the Road Lending could bring to their communities. Given the seemingly limitless potential, Michelle and her team are being very conscientious about their growth, with plans in place to be in 10 states by the end of this year.“We’re trying to think about markets that tend to be overlooked,” Michelle said, “and that tends to be driven by partners that want to bring us pretty heavily into a certain market.”

Photo Credit: On The Road Lending

Incredibly, On the Road Lending is just one of eight entities under Champion Impact Capital’s umbrella, meaning that the CDFI’s daily operations and scalability challenges represent only a fraction of Michelle’s day-to-day workload. Another entity under Michelle’s domain is On the Road Garage, a business that trains skilled technicians to do commercial collision repair for insurance companies. Currently, On the Road Garage has five registered apprenticeship programs with the Department of Labor; however, Michelle is confident that that number will grow in the coming months, fueled in part by partnerships with major corporations to work on their vans. “Without a four-year degree, these technicians can make $150,000 a year working on cars,” she said. “This is real life-changing money for people, and we’re teaching them the business so that they can go on once they’re done with us and have really great opportunities everywhere.”

Michelle is fortunate that within each of her business entities, she’s surrounded herself with incredible colleagues who match her passion, mile for mile. Although the individual business endeavors differ, they’re in many ways complementary to each other, as each focuses on a different aspect of the same overarching objective: to create a vertical integration strategy that brings down transportation costs across the value chain to make transportation more accessible and affordable for everyone. “We want to build prosperity and remove transportation barriers for people,” Michelle said. “We are busy, but we’re all very committed to the mission, and we love what we do. We’re very lucky for that.”

Photo Credit: On The Road Lending

Learn More

  • On the Road Lending formed in 2013 to help people find cars that worked for them and to teach them how to make good financial decisions. Through their loan funds, they make low-cost loans on reliable cars based on who people are—not their credit scores.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

Meet Mellaney Williams, The Big Dreamer Behind American Home and Commercial Services

Mellaney Williams

When Mellaney Williams and her husband graduated college and moved to South Carolina in 2001, Mellaney’s husband got himself involved in the irrigation installation trade. However, what started as a side hustle quickly turned into something much bigger, as demand for him and his services grew. Soon, American Home and Commercial Services LLC was doing much more than irrigation; it was doing landscape design and installations, lighting, hardscapes, water features, and even interior paint jobs and flooring projects. 

By 2010, Mellaney’s husband needed help with the business, so Mellaney quit her job and took over the financial side of the operation, as well as marketing, to take some of the administrative burden off of him. The arrangement quickly proved itself to be a win-win. “My husband is very gifted and he was doing fine, but the business had become overwhelming,” Mellaney said. “When I joined, I found my little groove to help it stay consistent. It’s been a miraculous ride.”

However, that “miraculous ride” was put in jeopardy in March 2020, when the COVID-19 pandemic immediately affected Mellaney’s business. Suddenly, there were fewer opportunities to land jobs, and it was difficult to retain workers. With more money going out than coming in, Mellaney had to cut back on things like advertising in order to keep the doors open. She even started going out on projects to help her husband in the field. That’s how she learned how to change sprinkler heads, install lighting systems, and construct ponds. Despite Mellaney and her husband cutting back and being resourceful to make ends meet, American Home and Commercial Services still needed help to ensure that the company could continue to pay its bills and cover its expenses.

Initially, Mellaney wanted more information about the Paycheck Protection Program (PPP). She ventured online, but struck out because she couldn’t connect with a person to ask questions and get support. Instead, she ran into red tape and confusion. According to Mellaney, the experience left her feeling lonely. Those feelings were exacerbated when she turned to a credit union where she’d done business for more than 10 years and was told that her PPP loan application wasn’t formatted correctly. “Instead of elaborating and saying ‘if you do this, then we can approve it,’ they did nothing,” Mellaney said. “I felt abandoned. Out here in this pandemic as an African American woman business owner, and no one was there to help. It was very hard.”

Fortunately, someone in Mellaney’s network suggested that she reach out to Optus Bank. Optus Bank is a Columbia-based community bank with a mission-driven purpose. For the past 100 years, it’s been working to strengthen communities throughout South Carolina by closing the wealth gap created by systematic disparities in the financial industry. Optus Bank is a certified Community Development Financial Institution (CDFI), and its main goal is to ensure that wealth building is not just for the wealthy. CNote partners with CDFIs like Optus Bank across the country through its Impact Cash™ Solution, empowering woman small business owners like Mellaney.

According to Mellaney, her experience working with Optus Bank was “amazing,” “transparent,” and “a breath of fresh air.” She said that the application was straightforward, deadlines were clear, and her questions were answered — by real people. Within two weeks of contacting Optus in July 2020, Mellaney was notified that she was approved for her PPP loan. “I can’t put it into words,” she said. “I was so elated. They extended that hand to help me, and they gave a lifeline to my business. They made me a believer, and I can’t recommend them enough. Optus Bank will have my business for all of my future endeavors, because I have plans for big things.”

‘You Gotta Dream Big’

As Mellaney alluded to, she doesn’t intend to slow down anytime soon. Roughly seven years ago, American Home and Commercial Services had the opportunity to be a subcontractor for one of the largest landscape irrigation companies in the southeastern United States. The project was incredibly challenging, and it required an immense level of physical and mental fortitude to complete; however, Mellaney says that the project, including getting a glimpse into the operations of a much larger company, opened up her eyes to what was possible. “I knew that was a stepping stone to take us to another level,” she said. “If we could have the tenacity to complete that project, then we can do anything. That was the most challenging moment, but it was also the most rewarding experience, because we learned that there is no limit when you put your mind to whatever you want.”

What Mellaney wants for her business’ future is to expand into other cities, to grow its operations, and to bring as much of its supply chain as possible in house. Her ultimate goal, however, is to franchise American Home and Commercial Services and to one day go public. She’s a vocal promoter of Dun & Bradstreet, a global company that helps small businesses to connect with potential partners and investors. Mellaney discovered the company earlier this year, and she says having a D-U-N-S number has allowed her to both grow her business and talk confidently about her company’s future. “I love dreaming big,” she said. “If you don’t have a dream, then what’s the use — life is boring. You gotta dream big.”

Today, in the wake of losing her mother to COVID-19 in October, Mellaney has the joy of dreaming not only about her future, but the future of her infant daughter. According to Mellaney, while owning a successful business is fulfilling, it’s impossible to compare that to having a beautiful baby girl waiting for her at home. “Nothing else is more rewarding,” Mellaney said. “Now, I work even harder for her.”

Learn More

  • Optus Bank is a community bank, with a mission-driven purpose. They help strengthen their community by closing the wealth gap created by systemic disparities in the financial industry. By providing loans and banking services to local businesses and individuals they serve to turn deposits into direct support for the communities where their customers live and work.
  • CNote – Interested in helping create another story like Mellaney’s? CNote makes it easy to invest in great banks like Optus, helping you earn more while having a positive impact on businesses and communities across America.
By Borrower Stories, Community Partners

These Maine CDFIs Are Showing Mainstream Lenders How to Open Doors For Muslim Borrowers

When Yassin arrived in western Maine in 2008 as a refugee from Djibouti, he knew that he wanted to start his own business one day. In recent decades, Maine has become a destination for a growing population of immigrants like Yassin, who are seeking to build a life for themselves in the U.S. According to Yassin, however, new Mainers often find themselves in difficult living situations due to a shortage of quality affordable housing and other cultural and structural barriers. Therefore, although Yassin was trained as an accountant in Djibouti, his entrepreneurial spirit led him in a different direction.

Photo credit: The Genesis Fund/Flax Studios

To address the renter-rentee issues in his community, Yassin wanted to purchase apartment buildings and rent out units to immigrants who could relate to him. Despite his desire to start his own business, Yassin wasn’t able to go to a traditional lender to apply for a small business loan. That’s because many Muslim borrowers like Yassin are prohibited by their faith practice from paying or receiving interest. As Yassin discovered, most traditional lenders weren’t willing to modify their conventional lending practices or to consider non-interest-based lending models in order to accommodate aspiring Muslim entrepreneurs like him.

Photo credit: The Genesis Fund/Flax Studios

That’s when Yassin connected with Coastal Enterprises Inc. (CEI), a community development financial institution (CDFI) that’s been working in Maine since 1977 to build livelihoods, wealth, and a more equitable and sustainable economy. CEI received a grant to focus on immigrant and new-Mainer entrepreneurs who needed small business start-up funding but who weren’t able to access conventional lending. What the CEI team came up with was a fee-based lending program designed and developed with Maine’s Muslim community in mind.

Fee-based lending works like this: First, these loans are loaned out with a 0% interest rate. Second, the principal of the loan is divided into equal monthly segments depending on the loan terms (e.g. 84 segments for a seven-year business loan). Then, any fees associated with the loan (e.g. costs associated with closing and administering the loan) are calculated and transparently shared with the customer. Depending on the size and terms of the loan, a borrower can either prepay the fees upfront (i.e. pay a $750 fee on a five-year, $10,000 small business loan) or, in the case of larger loans (i.e. a $300,000 commercial real estate loan), the fees can be divided into flat, even monthly allocations that are added to the monthly principal payments.

John Egan and Yassin. Photo credit: The Genesis Fund/Flax Studios

John Egan worked at CEI for 20 years and is now the chief lending and program officer at the Genesis Fund, another Maine CDFI. He adapted the fee-based lending approach to the Genesis Fund’s work, which is centered around affordable housing and community facility finance, including multifamily and commercial mortgage offerings. Through this new loan product, the Genesis Fund has now provided loan capital to Yassin for three properties, which provide rental housing and space for childcare providers serving the immigrant community in Lewiston. According to John, one of the reasons why fee-based loans work is because they’re designed to make sense. “Folks that have a prohibition against paying interest because of their religious convictions do not have the same prohibition about understanding how business works,” he said. “The idea that a fee is attached to the activity of lending money at 0% is not a philosophical or religious conviction challenge, and from what we’ve found, everybody can get behind the concept.”

Photo credit: Soggy Dog Designs

John pointed out that, besides a small distinction in how promissory notes are written and how loans are packaged in the loan software, these fee-based loans “live, breathe, serve, and pay” in CDFIs’ portfolios the same way as interest-based loans. 

John said that when Genesis was crunching the numbers on fee-based loans, he and his colleagues determined that if the loan remains outstanding for seven to ten years, which is typical in Maine, their returns would be about the same as they would with an interest-based loan. “These aren’t a net deficit on our portfolio,” he said. “Instead, we saw that fee-based loans would allow us to actually deploy more capital, further our mission, and reach a group of people that have no access to the mainstream banking system. When we saw that, we were pretty quick to say ‘of course we’re going to do this.’”

‘That’s Part of Our Job as CDFIs’

To date, Genesis Fund has a handful of fee-based loans in its portfolio, and although John and his colleagues hope to increase that number by double digits in the next two years, he’s arguably more enthusiastic about getting local banks to adopt fee-based lending in the near term. According to him, that’s part of the innovative role of CDFIs: to find new ways to fill gaps in the lending market that can in turn be picked up by traditional sources of capital. “That’s part of our job as CDFIs,” John said. “It’s to demonstrate these community projects so that next time, they can be financed by banks, not by us.”

This isn’t the first time that Genesis has led by example in order to get traditional lenders to innovate. For example, Genesis currently has 10 resident-owned manufactured home parks in its portfolio. Although “that’s a drop in the bucket” for a local bank that might have thousands of loans in its portfolio, John says that being able to share data from even a small sample size helps to assuage the concerns of risk managers and risk-averse bankers. By demonstrating the sound economics of deploying loans to manufactured home parks, Genesis helped pave the way for three Maine community banks to participate in financing these resident-owned communities.

Importantly, John isn’t nervous about losing business to local banks; he’s more focused on ensuring that banks understand what CDFIs like Genesis are and aren’t doing, especially regarding fee-based lending. “We’re not a granting agency, and we’re not giving away money like a foundation,” he said. “We’re lending with sound finance principles. We proved the concept and demonstrated how to mitigate the risk, and now it’s time to get banks involved because their volume is so much bigger. We’re confident that we’ll be successful in doing that.”

Meanwhile, John and his colleagues at Genesis are exploring other innovative lending programs in their community, including advocating for a fee-based home mortgage product for immigrant families to buy their first home in Maine. John says that he’s working with state housing officials, local credit unions, and developers to make it happen; however, anecdotally speaking, he said that the first lender to come out with such a product “is going to get run over with applications.” That’s because there is so much demand from immigrants who want to put down roots in Maine. “It’s not a secret,” John said. “When somebody can own property in their neighborhood instead of rent, they have a much louder voice. When you’ve got a higher concentration of owner-occupants in a neighborhood, those people take pride in their properties and reinvest in those properties, and community conditions improve. That’s what Maine needs.”

Photo credit: The Genesis Fund/Flax Studios

In the meantime, small real estate investors like Yassin — entrepreneurs who’ve benefited from fee-based loans from CEI and the Genesis Fund — are stepping up to provide affordable and accessible housing for the immigrants in their community. Today, Yassin owns 12 properties, and he estimates that 90% of his residents are immigrants. According to him, without having the opportunity to simultaneously borrow money and adhere to his Islamic faith, he wouldn’t have been able to pursue his entrepreneurial dreams, including hiring two full-time employees. “Honestly, if that program wasn’t there, then I wouldn’t have my business,” Yassin said. “[Fee-based lending] opened up the life I have today.”

Learn More

  • The Genesis Fund provides innovative financing by soliciting investment loans from individuals, churches, corporations, and foundations, and then re-lending the money at favorable terms to nonprofit organizations developing affordable housing and community facilities for underserved people and communities throughout Maine and beyond.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

Meet Danielle Mahon, The Entrepreneur Whose Company, Topsail Steamer, Has The Wind At Its Back

Although Danielle Mahon identifies as a late-in-life entrepreneur, she’s more of a waiting-for-the-right-idea entrepreneur. Danielle grew up in southern New Jersey, and she spent her summers on the Jersey Shore with friends and family. Danielle pursued a career in sales, but it was her husband’s job that took her and her children to Raleigh, North Carolina, where Danielle quickly put down roots on (and fell in love with) nearby Topsail Island. She spent the next 10 years working in biotech before going on a girls trip to the Outer Banks in 2016. It was there, having lunch with her mother and sister, that Danielle found her business idea: the restaurant where they were eating offered make-at-home seafood steam pots, where patrons could take the black-and-white enamel pots home and return them the next day. The concept struck Danielle, and a business plan that didn’t require a full-service restaurant began to take shape in her head.

For Danielle, the timing seemed right to open a business. She and her husband were preparing to send their youngest child to college, and the soon-to-be empty-nesters were more than ready to move from Raleigh to Topsail. In no time at all, Danielle quit her job in corporate America, moved to the beach, and with a $75,000 loan from a family member, she opened Topsail Steamer in Surf City in March 2017. Topsail Steamer’s business model is straightforward: sell customizable, one-time-use steam pots — filled with fresh seafood, sausage, veggies, and homemade seasonings — so that people can take the buckets home, add water (or beer), and cook, eat, and enjoy them. Topsail Steamer even includes cocktail sauce, butter, and brown paper for the table, adding to the at-home dining experience. Despite the steep learning curve, Danielle quickly mastered how to handle and source all of her seafood locally (when possible), and a strong first year paved the way for Topsail Steamer to open a second location in neighboring Wrightsville Beach in May 2018.

Business continued to be strong until September of that year, when Hurricane Florence walloped Topsail Island, effectively devastating the area’s tourism-dependent shoulder season and many of the residents’ homes. It’s never easy to be hit by a hurricane, but for a new business with a three-month-old second location, Topsail Steamer struggled to regain its footing after the storm. That’s when Danielle connected with Thread Capital, a Community Development Financial Institution (CDFI) that offers North Carolina small business owners capital, coaching, and networking opportunities. According to Danielle, she received funds to shore up her business and to make Topsail Steamer more resilient so that it could face — and survive — a future natural disaster. For Danielle, building resiliency into her business meant figuring out a way to ship her seafood pots straight to customers’ front doors. With a loan from Thread Capital, Danielle was able to buy a generator, build out her business’ refrigeration systems, and get the necessary packaging in place to start Topsail Steamer’s shipping services.

Wind In Her Sails

In April 2019, Danielle and her growing team shipped their first seafood bucket. Around that same time, another opportunity to make Topsail Steamer more resilient presented itself: the building across the street went on the market in Surf City. Until that point, Danielle had been a renter, which opened her up to tremendous risk in the face of another hurricane, as a flattened, uninsured building would have been the end to Topsail Steamer. Danielle wanted to purchase the building, but she again needed help from a CDFI. This time, Thread Capital connected her with one of its partners called Natural Capital Investment Fund (NCIF), a CDFI that provides loans and technical assistance to innovative entrepreneurs across a nine-state region. CNote partners with CDFIs like NCIF in communities across the country, providing business coaching, funding loans, and empowering local entrepreneurs like Danielle.

NCIF lent Danielle the capital she needed to purchase the building in Surf City, and by August 2019, Topsail Steamer was shipping 25 orders a week. That’s when, once again, a vacation with friends and family spurred Danielle to make another big entrepreneurial move. This time, she was back in Ocean City, New Jersey trying to visit one of her favorite fudge spots; however, the store had shuttered. Danielle had never considered taking Topsail Steamer to Ocean City, but the vacancy at the “million-dollar,” highly trafficked location was enough to convince her otherwise.

Danielle rented the space, and in January 2020, while she was moving forward with renovations at her Ocean City location, she came across Goldbelly, a curated online marketplace for regional and artisanal foods crafted by local food purveyors throughout the United States. Danielle applied and a few days later, Goldbelly asked her to send a seafood pot to Manhattan. Within a month and a half, Topsail Steamer was on Goldbelly’s platform. Incredibly, Danielle’s business went live with Goldbelly during the first week of March 2020, just as the COVID-19 pandemic was beginning to shut down everything. As people shifted to primarily ordering food online, business exploded for Topsail Steamer, and Danielle and her team went from shipping 25 buckets a week to shipping 400 buckets a week.

For a third time, Danielle needed assistance from one of her trusted CDFI partners. This time, she needed both capital — again, for refrigeration — and business mentorship and advice. “We went from about $350,000-worth of business in 2017 to $3.2 million in 2020,” Danielle said. “It all happened so fast, and so we just needed a growth advisor to make sure that we’re creating a foundation that’s both going to support what’s happening and to allow us to intentionally grow and maintain our high standards. As somebody who is a new business owner, there are so many areas that you have to either be an expert in or have somebody who is a subject matter expert to help advise you, and NCIF has really been that partner for us.”

Full Steam Ahead

Today, Topsail Steamer has six locations between North Carolina and New Jersey, and via Goldbelly, the company has shipped seafood buckets to all 50 states. Danielle has no plans of slowing down her business’ expansion anytime soon, and according to her, she wants to open anywhere from two to four more stores every year, but only if she and her team find the right places in the right markets. She’s also resisting going down the traditional franchising route, instead favoring to keep Topsail Steamer family-, friend-, and employee-operated. That means cultivating her base of 100-plus talented employees, creating professional development opportunities internally, and growing her leadership team from within her stores. Point in case: Danielle’s brother-in-law, Brian, is Topsail Steamer’s director of store operations, and her two children, Emily and Jimmy — the company’s first two employees — continue to work full-time in local store marketing and business development for Topsail Steamer.

Given where she was and what she was doing five years ago, it may seem unbelievable what Danielle is doing today as the founder and CEO of Topsail Steamer; but, for Danielle, something like this was always in the cards for her. She grew up watching her father, who happened to be a small business owner himself, and according to her, one of her strengths has always been to identify opportunities around her. In the case of Topsail Steamer, while it’s been a blend of opportunity, timing, and serendipity that has contributed to its success, the business’ skyrocketing trajectory is in large part a result of Danielle having faith in herself. Unsurprisingly, when asked what advice she has for other late-in-life entrepreneurs, it’s the same advice that she’s told herself time and time again: “just have confidence in yourself.”

Learn More

  • Topsail Steamer offers seafood steam pots prepared with fresh local seafood, meats, veggies, and homemade seasonings to take home, steam, eat and enjoy!
  • Natural Capital Investment Fund (NCIF) is a CDFI that provides loans and technical assistance to innovative entrepreneurs across a nine-state region.
  • CNote – Interested in helping create another story like Danielle’s? CNote makes it easy to invest in great CDFIs like NCIF, helping you earn more while having a positive impact on businesses and communities across America.
By Community Partners

How Credit Unions Rose To The Challenges Presented By PPP Loan Issuance And Forgiveness

When Jim Barnhart pushed pause on his 34-year-long career in banking, he never could have imagined that a global pandemic was right around the corner. Instead, Jim was looking forward to some quality time at home with his family, particularly so he could help his son, a senior in high school, transition to college. As would be the case, however, Jim’s time away from the financial sector would ultimately be cut short by the demand for SBA commercial loan officers, whose expertise was essential to addressing the staggering economic toll inflicted by COVID-19.

Even before the pandemic sent the U.S. into a lockdown in March 2020, entrepreneurs around the country feared that their small businesses wouldn’t be able to survive an economic shutdown. However, when President Trump signed the roughly $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES Act) into law on March 27, there was a glimmer of hope. The unprecedented stimulus package allocated nearly $350 billion for small businesses to continue to pay their employees through the Small Business Administration’s (SBA) loan program. Called the Paycheck Protection Program (PPP), the loans were originally designed to cover eight weeks of expenses. Moreover, if employers didn’t lay off employees or cut payroll, loans spent on payroll costs, mortgage payments, rent, and insurance could be forgiven.

Almost immediately, there were headaches. Not only was the window to apply for initial PPP funding short, but the understanding was that as soon as the $350 billion was deployed, that was all the help that was available. To complicate matters, while SBA’s usual demographic is businesses with 500 employees or less, special circumstances allowed for PPP money to flow to much larger, national enterprises that had 500 or fewer employees at individual locations. That’s how businesses like Shake Shack and Ruth’s Chris Steak House — restaurants with thousands of employees —  got $10 million and $20 million loans, respectively, from the SBA. Although these businesses, and others, returned their loans to the SBA after public outcry, one thing was clear: larger and well-known businesses were receiving PPP funding while small businesses and nonprofits up and down Main Street America were struggling.

For example, John Highkin’s San Diego-based nonprofit, Fern Street Circus, had banked with two big-name banks for more than 30 years, but neither of those banks was willing to help him get PPP funding. Similarly, Barbara McCullough, CEO at Brighter Beginnings, was confident that the bank where she did business for over 10 years in the Bay Area would want to help her nonprofit secure a PPP loan: she was told “no.” As frustrating as an outright rejection was for small organizational leaders like John and Barbara, for many, they didn’t even get a response from the banks where they’d held accounts for decades. Instead, while the application window began to shrink and the pool of PPP money was being rapidly depleted, desperate emails went unanswered, and phone calls went straight to voicemail.

Rising To The Occasion

Although a few important things happened regarding PPP, including a deadline extension for the initial round of loans and a second round of funding that brought the forgivable loan program up to $953 billion, for many small business owners, the experience of being let down by their bank at such a critical point in time led them to take their business elsewhere, including to community development financial institutions (CDFIs) and credit unions. Not only could these community financial institutions distribute PPP funding as SBA-approved lenders, but because these mission-driven organizations focus on character-based lending, financial literacy building, and business skills training, they were uniquely prepared to help small business owners and nonprofit leaders who’d been neglected by their traditional banks to both get PPP dollars and weather the pandemic.

Take Michea Rahman, the owner of the Children’s Language Center in Houston, for example. Michea enrolled in a business resiliency class through TruFund, a CDFI that invests in small businesses in New York, Alabama, Louisiana, and Texas, after her business came to a standstill at the beginning of the pandemic. In addition to business coaching, TruFund provided Michea with real-time information about PPP loans, and when the time came, the CDFI helped her with her application and forgiveness paperwork. While Michea credits the PPP funds for helping her business to stay afloat, she says the training and support from TruFund have allowed her to grow her business to the point that it’s doing better than it was before the pandemic. That includes expanding the number of families she’s helping, hiring a full-time employee, and moving into a larger space.

While hundreds of credit unions and CDFIs like TruFund were able to play their part as economic shock absorbers throughout the ongoing COVID-19 pandemic, these financial institutions faced great operational strains, and for many, they needed to quickly grow their teams in order to meet the needs of the small business owners and nonprofit leaders in their communities. For Self-Help, a nonprofit financial institution with branches across Florida, North Carolina, South Carolina, and Virginia, that meant hiring Jim Barnhart, who stepped in as an experienced, albeit temporary, loan forgiveness officer in October 2020. “[Self-Help] hadn’t seen this type of loan volume on a regular basis before,” Jim said. “With the amount of applications coming in, they were the bottleneck, and they couldn’t get to them as quickly as they needed to. The clock was ticking, and that’s when they realized they needed to hire some more help.”

‘We’re Gonna Need A Bigger Boat’

According to Jim, he was happy to step out of his semi-retirement to join Self-Help’s PPP efforts, and although he remained at home and worked remotely, he says his colleagues’ camaraderie and dedication were palpable, even through phone calls and Zoom meetings. Jim says that inspired him to hit the ground running, so that he could help as many small business owners and nonprofits as possible with their PPP forgiveness applications. Additionally, because everyone from Self-Help executives to Self-Help area managers were working on various aspects of the PPP process (in addition to their day jobs), Jim says there was a feeling of “all hands on deck.” Although that led to long hours and late nights, Jim claims that his colleagues’ collective commitment to get through the pile of PPP applications helped to keep a fire lit under him.

That, and the desperation he could so clearly hear in Self Help’s clients’ voices. Not only were people’s livelihoods on the line, but for nonprofits and social enterprises dedicated to serving communities, the PPP loan applications were about more than paying employees: they were about keeping things like youth programs running, health clinics operational, and food banks open. “If someone called me at 8:30 pm while I was at a football game with my son, I was gonna take it,” Jim said. “You can’t take care of everybody, but at the end of the day, if you take care of the people that are taking care of the people, then people will be taken care of. That’s what Self-Help does.”

Jim wasn’t the only new addition to Self-Help striving to “take care of the people … taking care of the people.” According to him, between October 2020 and January 2021, the credit union doubled the size of its staff of forgiveness officers. Similarly, Self-Help brought additional loan officers and underwriters on board to help meet the needs at the front end of the PPP process. Jim credit’s Self-Help’s leadership team with having the wherewithal and foresight in order to address PPP holistically, from the beginning of the pipeline (i.e. eligibility and applications) to the end of the pipeline (i.e. forgiveness), in order to meet its members’ needs. He also says that the credit union’s leadership did a great job of keeping abreast with changes at the SBA, getting information, and channeling it down to its team so that they would be better prepared to do their jobs and answer questions. That transparency and real-time communication ultimately allowed Jim to be proactive with helping Self-Help’s customers adjust to PPP changes.

Perhaps not surprisingly, Jim won’t be returning to his life of semi-retirement anytime soon — he signed on full-time with Self-Help in July of 2021. According to him, he fell in love with the credit union’s focus on minority-owned businesses, nonprofits, and other enterprises that traditional banks typically don’t consider, and he’s already feeling like he’s making a difference. “You go home every night feeling like you did some good,” Jim said. “I haven’t felt this good in my 30-something years in banking, where my stress is a blessing because I get to come back tomorrow and ask ‘how do we do more?’ At Self-Help, that really is the goal every day.”

Learn More

  • Self-Help is a nonprofit financial institution with branches across Florida, North Carolina, South Carolina, and Virginia.
  • CNote is a women-led impact investment platform that uses technology to unlock diversified and proven community investments to generate economic mobility and financial inclusion.

CNote’s Quarter Impact Report Q2 2021

By | Impact Metrics | No Comments

We’re excited to announce that CNote investors helped to create/maintain over 400 jobs in Q2 of 2021.

In this report you’ll see:

  • An update from CNote’s Head of Community Development Director
  • CNote’s Q2 impact metrics
  • Three new CNote impact stories
  • A CNote firm and portfolio update

Since Inception, CNote has created or maintained

5,232 Jobs

In Quarter Two of 2021, CNote Deployed:

71% of Dollars to BIPOC-Owned Businesses 

From the time that Dr. Alexia McClerkin broke her ankle in high school, she knew she wanted to become a doctor. She chose to study kinesiology so that she could work with athletes, allowing them to get better and to return to their sports. That passion led Alexia to become a registered nurse and study chiropractic medicine.

In June 2016, she started her own private practice- The Beauty and Wellness Doc, which offers a variety of traditional services, including adjustments, deep tissue massage, stretching, dry needling, athlete recovery, therapeutic laser, and cupping.

When Alexia initially looked to furnish her new space with equipment and furniture, she met with a lender who told her that they would give her a loan that wouldn’t affect her credit. After reading the fine print, however, Alexia discovered that the interest rate was 65% and that she would have to pay an exorbitant loan origination fee.

Fortunately, Alexia already had a long-standing relationship with CNote CDFI partner, Trufund, who was able to help Alexia to navigate the second round of PPP funding. Today, business at The Beauty and Wellness Doc is booming. According to Alexia, the pandemic, in a way, has turned out to be good for her business, as the pivot to remote working has left a lot of people with low back, shoulder, and neck pain caused by poor ergonomics and bad workspaces at home.

I had absolutely no idea how to go at it [apply for a PPP loan],” she said. “But Jessica [Whittington] from TruFund walked me through the process. We went through my finances and made sure everything was in place so that I could get it. She was true to her word. It was so
easy and seamless and within a few days, I looked in my bank account and the money was there.”

In Quarter Two of 2021, CNote Deployed:

43% of Dollars to Women-Led Businesses 

Tanesha Sims-Summers is the founder of Naughty But Nice Kettle Corn Co., a gourmet, hand-popped kettle corn company based out of Birmingham, Alabama.

While Tanesha credits the success of her company with having a quality (and addictive) product, she notes that seizing every opportunity to educate herself as an entrepreneur has equally fueled her company’s growth. That thirst for education is what led her to connect with TruFund, a CNote partner and Community Development Financial Institution (CDFI).

Tanesha has taken advantage of a number of TruFund’s programmatic offerings, and through the CDFI, she’s connected with and learned from fellow entrepreneurs. Additionally, in 2019 TruFund provided Tanesha with a $50,000 loan to complete the build-out of Naughty But Nice Kettle Corn Co.’s food truck — Miss Poppy — and to provide some extra cushion for miscellaneous expenses.

Lift Fund seemed really interested in my story,” Tawnya said, “and they wanted to help. I felt like I gave them my life’s history, from financial to personal, but they really wanted to get to know who I was. They wanted to know who they’d be investing in.

In Q2 of 2021, CNote deployed

38% of Dollars to Low-and Moderate-Income Communities

Those dollars ended up supporting individuals like Tawnya Sanford who had opened an in-home daycare center so that she could spend more time with her daughter. Years later, when Tawnya was looking to expand to a larger daycare center, she was put in touch with the owners of The Little Engine Learning Center. But when the time came to purchase the business, Tawnya ran into a problem: finding a bank that would give her a loan.

“Every time I’d call a bank about a loan, they’d tell me ‘no,’” Tawnya said. “They told me I needed to have between $80,000 and $100,000 before they’d even talk to me. It was very depressing.”

Fortunately, Tawnya was able to connect with LiftFund, a CNote partner and San Antonio-based Community Development Financial Institution (CDFI), who was able to provide a 401(k)-backed loan that allowed her to purchase the business portion of the Little Engine Learning Center.

Lift Fund seemed really interested in my story,” Tawnya said, “and they wanted to help. I felt like I gave them my life’s history, from financial to personal, but they really wanted to get to know who I was. They wanted to know who they’d be investing in.

CNote Partner Profile: LiftFund

Portfolio: CNote Flagship Fund

About: CNote continues to profile our CDFI partners to highlight the incredible work they have done and continue to do for their local communities. These profiles will discuss their focus area, the geographies they serve, and a specific impact story that exemplifies the work they do.

Thousands of financially underserved small businesses and entrepreneurs are denied capital daily and need to rely on predatory lenders that cost more than they can afford. According to data released by the Federal Reserve in 2020, while 80.2% of White business owners received at least a percentage of the funding they requested from a bank, that figure was only 60.9% for Black business owners and 69.5% for Hispanic business owners.

LiftFund, a CDFI loan fund, was founded in 1994 in San Antonio, Texas, to level the financial playing field for the financially underserved entrepreneur with the goal of self-sufficiency and success for all those seeking it. LiftFund believes everyone deserves the opportunity to build a company successfully with capital no matter their background, race, ethnicity, sexual identity, or geography.

In 2020 alone, LiftFund equipped 4,500 small businesses with $98.2 million in relief funding in the form of small business loans, forgivable loans, grants, loan payment relief, and PPP, primarily to low to moderate-income, BIPOC communities. But capital is only one piece of the puzzle for small business success. That’s why LiftFund also provided over 7,000 hours of business support in topics like credit review, startup assistance, financial education, and more.

These dollars and business support hours help entrepreneurs like Montina Young, Founder of CIA Media Group, an award-winning digital marketing agency helping companies rethink business for the digital age. Even though business was booming for Montina, she often did not receive payment for her services for 30, 60, or sometimes even 90 days after the project was completed. She connected with LiftFund who provided Montina with funding to have sufficient payroll on hand, purchase video production equipment, and repay debt.

LiftFund was also able to provide technical assistance to Montina, teaching her how to read her cash flow statement, profit and loss statement, and balance sheets. Montina has also taken advantage of the professional gathering opportunities offered by LiftFund, which she says are especially important for BIPOC and women entrepreneurs, who don’t often have mentors or family members who’ve owned and operated a successful business.

I love, love, love, CDFIs,” she said. “CDFIs educate you about the loans you’re taking out, they look at your business plan, and they want to grow and scale with your business. They’re truly phenomenal.”

CNote Firm Update

At CNote, our north star is to close the wealth gap by driving investments and deposits into institutions that are generating long-term positive change for financially underserved communities.

That is why we were thrilled when PayPal announced that it would deposit $135M into mission-driven financial institutions, including depository institutions, through CNote’s Impact Cash™ Program. PayPal also committed to investing in wealth creation opportunities for BIPOC women by investing in CNote’s Wisdom Fund.

In April, CNote celebrated its five-year anniversary. In those five years, we have continued to innovate to best meet the needs of our partners and the communities that they serve. That’s why in response to requests from investors who wanted to support specific geographies and demographics, CNote created a new customization service that allows corporate treasury departments to invest in specific CDFIs that help them meet diversity, equity, and inclusion goals and improve their performance on ESG measures.

Finally, over the last quarter, CNote was featured in publications like Sustainable Brands, Green Money, Green Biz, and NASDAQ. These articles covered topics like democratizing capital, how treasurers can lead their company’s impact investing efforts, and roadmaps for a more equitable future. By continuing to be a thought leader in the space and driving capital towards community needs across the U.S, CNote continues to contribute to a more equal future.

CNote Portfolio Update 

CNote’s portfolio of CDFI Loan Funds continues to demonstrate solid performance and financial stability. Across several weighted average indicators, the portfolio saw minimal changes. Specifically, net assets to total assets saw a slight decline from 29.8% to 29.3%. While delinquency levels did decrease, charge-off levels saw a slight increase from the prior quarter, though staying well below 1% and lower than the historical charge-off levels, including the past 12 months. Overall, the portfolio indicators are comparable or better than the same indicators a year ago.

CNote brings a nationwide network of community partners and the expertise to know when and where capital is needed. They also know how to work with a corporate finance department, and made it easier for us to broaden and deepen our efforts to help underserved communities of color thrive."- Aaron Anderson, Treasurer, PayPal

CNote Portfolio Update

Taken together, these indicators are consistent with a portfolio, like the CDFI industry writ large, that continues to engage in either pandemic-responsive or business-restart lending in a responsible manner; CDFIs are investing built-up cash, reserves, and net assets from prior quarters strategically to respond to the needs of its respective client base as the various local, state, and federal resources have begun to wind down or have sunset. This also includes several CDFIs continuing sustained PPP lending through May 31, 2021, originally extended from the March 31, 2021 program deadline.

In the prior quarter lending summary, CNote mentioned the imminent boost to 863 CDFIs through the Rapid Response Program, a $1.25B supplemental appropriation for the fund to provide grants to CDFIs to support, prepare for, and respond to the economic impact of the COVID-19 pandemic. All CNote’s current portfolio borrowers were awardees of this program, with most receiving the maximum allocation. Several portfolio borrowers report having received or an expectation to receive these funds in the near-term.

If you think about it from end to end, leveraging CNote’s platform for scale and for impact reporting, that's what got us comfortable, and that was the simplification that we were looking for.” -Dena Devaney, Mastercard

Letter from CNote’s Community Development Director

Uneven economic recovery from COVID-19 will be an enduring issue in the US. Employment rates for high-wage workers have already surpassed pre-covid levels, yet job losses continue for low-wage workers. As of May 15th, employment rates for high-wage workers had risen by nearly 9%, while they had decreased by over 20% for low-wage workers.

We partner and deploy capital exclusively to financial institutions whose mission is to support and financially empower underserved communities. These are the communities with low-wage workers whose struggles are far from over. As CNote’s Community Development Director, I listen closely to these partners to ensure that we understand their challenges so we can continue to best serve them and the communities they work with.

In support of these efforts, CNote authored a Spring 2021 Capital Needs Survey, the first report in a bi-annual series designed to help investors understand the capital needs of CDFIs and ongoing investment gaps that most efficiently address community needs.

The survey showed that 65% of surveyed CDFIs noted an increase in their capital demands over the last year. An additional 75% of surveyed loan funds expressed an “urgent or somewhat urgent need for capital over the next 6-12 months.”

Thankfully, Congress addressed the pressing need for capital with its appropriation of $204.5 million to the CDFI Fund. These awards are being distributed to CDFIs across the country and support programming related to technical assistance, persistent poverty financial assistance, disability funds financial assistance, and healthy food financing in low-income and financially underserved communities.

While these awards are critical in creating meaningful impact, it’s worth noting that the aggregate request from CDFIs from across the country totaled $565.3 million, highlighting the opportunity for impact investors to affect tremendous positive change in communities.

Every dollar invested or deposited with our community-first partners works towards reducing the wealth gap through affordable housing construction, connecting entrepreneurs with learning resources, and capitalizing small-business expansion. Combined, these activities create community development, economic empowerment, and wealth creation for communities that are still struggling to make a full recovery from COVID.

At CNote, we have never been more proud to partner with and support our CDFI and community partners. If you have any questions about CNote, our impact, or how you can work with us, please contact me at Stacy@mycnote.com.

Thank you for Reading 

Stacy Zielinski 

CNote’s Community Development Director 

By Borrower Stories

How Deshonda Charles Turned Her Dream Of Becoming A Lawyer Into A Successful Small Business

When Deshonda Charles, Esq. was a little girl, she wanted two things in life: to be a singer and to become a lawyer. According to her, she was attracted to the legal world thanks to Clair Huxtable, the matriarch at the center of The Cosby Show. A young Deshonda watched the television show during its original run when she was still in elementary school, and although she didn’t know exactly what it meant to be a lawyer, she knew she wanted to be a businesswoman like the one portrayed by Clair Huxtable. “I didn’t pursue any other career paths,” Deshonda said. “I’ve enjoyed it from the start. Fortunately for me, as I continued on my journey, I’ve learned that you can do so much more than just lawyering with a law degree.”

Deshonda received her law degree from Tulane University in 2003 and went on to pass four different Bar Exams in four states: Louisiana, Connecticut, New York, and Texas. Deshonda landed a position in a small boutique law firm in Houston, Texas after graduating and for just under six years she thrived at networking and promoting her services. Deshonda’s knack for generating business was recognized by the firm’s managing partner, and her mentor, who occasionally asked whether she’d ever considered starting her own practice. According to Deshonda, not only was he a wonderful mentor to her, but when she decided to initiate a conversation with him about going her own way six years after joining the firm, he told her that she had his full support. More so, he approved of her taking all of her current clients with her.

While attorneys aren’t typically associated with being entrepreneurial, Deshonda said that it came naturally to her. Her grandfather owned a neighborhood sundries shop in New Orleans, where she was born, so Deshonda had a very real-life example of what it meant to be a small business owner. On April 20, 2011, Deshonda founded The Tackett Firm (TTF) and took the role of President and CEO. More than 10 years later, the practice continues to focus on estate planning, employment discrimination disputes, family law matters, and civil litigation. Additionally, TTF handles matters in the states of Texas, Louisiana, and New York, as well as in the U.S. District Court for the Southern District of Texas and the Federal Fifth Circuit Court of Appeals. “I never intended to go into private practice, but it just kind of happened as a natural next step in my career, ” Deshonda said. “It’s pretty exciting to have been in practice all of this time and to have a successful firm.”

Do Better Business

TTF’s longevity, however, was threatened by the COVID-19-induced shutdowns that began in March 2020. According to Deshonda, she began to receive a lot of cold calls from people with questions about their employer’s response to the pandemic — for example, being forced to take leave. While the vast majority of incoming calls didn’t result in new business, Deshonda viewed the conversations as opportunities to cultivate relationships. Still, business slowed. To make matters more difficult, due to the realities created by COVID-19, Deshonda had to part ways with her sole paralegal, who’d been with her for nine and a half years. “That was really, really scary,” she said, “because then I had to start relying on new people who didn’t know my business as well. It takes a lot to train someone and to bring them up to speed. That was a challenge.”

Yet another challenge presented itself to Deshonda when she attempted to secure PPP funding for TTF. She went to the only big bank where she’s ever done business to inquire about resources, guidance, and PPP eligibility. According to her, she might as well have walked into the room and thrown spaghetti on the walls. “They just didn’t care,” she said. “I couldn’t get a banker to even acknowledge that I had submitted the application because I wasn’t a big enough fish.” Frustrated, Deshonda turned to the support group of like-minded minority women business owners that she’s a part of in Houston. That’s when one of her good friends referred her to TruFund, a Community Development Financial Institution (CDFI) that invests in small businesses in Texas, Alabama, Louisiana, and New York. CNote partners with CDFIs like TruFund in communities across the country, providing business coaching, funding loans, and empowering local entrepreneurs like Deshonda. Deshonda reached out to TruFund, and within a few days, she was connected with Jessica Whittington, a program officer who helped to walk Deshonda through the PPP application process. “It’s hard to describe how it feels to have that kind of support from a financial institution,” she said. “It was a game-changer.”

Not only did TruFund help Deshonda secure PPP funding so that she could pay herself, contract lawyers and as-needed, support staff, but the CDFI immediately plugged Deshonda into its suite of programmatic offerings. Thus far, she’s participated in three business support programs, including one called PitchHer, centered around developing a strong business pitch, and another called Empow-HER-ment, a comprehensive business and financial training program to enhance the business acumen of participating women entrepreneurs. The trainings, led by industry experts, range from general business topics to life-work balance challenges, management, strategy, marketing, accessing capital, credit building, and effectively delivering a business pitch to potential investors. Deshonda also completed TruFund’s FinanceHer program, a course dedicated to preparing women entrepreneurs to become capital-ready.

According to Deshonda, TruFund has helped her business in so many ways. The CDFI stayed connected with her so that when the second round of PPP funding became available, it was easy for Deshonda to submit everything and to apply. She also likes how responsive TruFund is to questions, whether over email or by phone, and she appreciates that trainings are held in the evenings and not during business hours. As someone who initially reached out to TruFund based on a word-of-mouth referral, Deshonda has since become a vocal advocate for the CDFI. “It’s one of those things where you’re calling your friends and your colleagues and saying ‘Y’all need to figure out how you’re going to participate in this program,’” she laughed, “Because TruFund is just so fantastic and helpful.”

Today, Deshonda feels good about the state of her business. More importantly, she feels good about the direction that her business is going. In the coming years, she plans to do more professional speaking engagements surrounding estate planning, and she’s focused on building a team around her, including hiring additional clerical staff and another paralegal who can grow with her business. In the meantime, she plans to continue doing what she does best: being a lawyer. “I just want to be able to continue to litigate in the areas that I know,” Deshonda said, “and I want to continue to grow. It’d be nice to bring on a full-time associate attorney — that’s been a goal for two years, but then COVID happened. I’m still definitely working toward that.”

Learn More

  • The Tackett Firm has been providing exceptional legal services and representation to the greater Houston, Texas community for 15 years. TTF’s primary practice areas include estate planning, employment discrimination litigation, and family law disputes.
  • TruFund – is a 501 (c) 3 certified Community Development Financial Institution (CDFI) headquartered in New York City with field offices in Alabama and Louisiana. TruFund tailors its financial and technical assistance to the unique needs of each site—from contractor mobilization lending in New York and Louisiana to rural Black Belt initiatives in Alabama.
  • CNote – Interested in helping create another story like Ethel’s? CNote makes it easy to invest in great CDFIs like TruFund, helping you earn more while having a positive impact on businesses and communities across America.

 

By Community Partners

Turning Dreams Into Reality: How Appalachian Community Capital’s Donna Gambrell Is Helping CDFIs To Thrive

Donna Gambrell’s journey into the world of Community Development Financial Institutions (CDFIs) was, as she puts it, “a crooked mile.” Donna studied journalism at Towson University, and upon graduation, she worked as a writer-editor. That eventually led her to the Federal Savings and Loan Insurance Corporation and Resolution Trust Corporation, where she worked for four years before taking a position at the Federal Deposit Insurance Corporation (FDIC). Donna spent more than 16 years at FDIC, where she oversaw the agency’s bank compliance, community and consumer affairs, and deposit insurance programs. In 2005, following the devastation of Hurricane Katrina, Donna traveled to the Gulf Coast with FDIC. It was during those two years living and working in Louisiana that Donna first encountered CDFIs. “My heart was captured,” she said. “I was so amazed by these organizations’ passion and their commitment to working in low-income communities. It was an amazing sight to see, and I thought ‘this is my life’s work. This is what I want to do.’”

In 2007, Donna returned to Washington D.C. and became the Department of the Treasury’s first Black woman appointed director of the CDFI Fund. During her six-year tenure, Donna oversaw significant growth at the fund, including a two-fold increase in the organization’s flagship program, which enabled CDFIs across the U.S. to provide additional and affordable capital, credit, and financial services to distressed communities nationwide. According to Donna, her time at the CDFI Fund was the pinnacle of her career, a sentiment fueled by the many, many chances she had to crisscross the country to visit CDFIs on the ground. 

By the time Donna left the CDFI Fund in 2013, she was the longest-serving director in its history. After leaving government service, Donna became a consultant, which is how she met Appalachian Community Capital (ACC), an intermediary CDFI that raises and distributes capital to regional CDFI members that in turn make loans to small businesses. When the CEO position opened in 2017, Donna didn’t have to think long about whether or not she wanted to take the reins. She accepted the job, and for the past four years, she’s been leading the CDFI.

A CDFI For CDFIs

ACC was created in 2013 to increase small business lending in Appalachia by providing underserved communities in 420 counties — 107 of which are rural — with new sources of capital. While there are more than 1,200 individual CDFIs in the U.S., there are only a handful of intermediary CDFIs like ACC, which work broadly across geographic regions. According to Donna, one benefit of having an intermediary model is that ACC is able to forge relationships with external investors, including national banks, foundations, and corporations, that smaller CDFIs can’t access. That’s partly because, from an investor’s standpoint, partnering with ACC is easy and efficient. Instead of directly investing in a dozen-or-so individual CDFIs, an investor can funnel money through ACC, which will, in turn, distribute that capital to the appropriate CDFIs in the hardest-hit parts of the community. Another perk: one aggregated ACC report rather than different reports from each individual CDFI. 

Today, ACC provides capital to 26 member CDFIs who are collectively focused on diversifying the economy, creating jobs, revitalizing communities, and developing small businesses in Appalachia. However, like all certified CDFIs, they provide more than lending: they offer wraparound services such as credit counseling classes, financial literacy training, and small business coaching. “That’s very different from a bank,” Donna said. “It’s a longer-term relationship, and it’s a much more engaged relationship. CDFIs really work with customers to make sure that the loan they’ve been provided is going to be workable and not put that customer in a deeper financial hole.”

Unsurprisingly, Donna uses the word “flexible” when describing CDFIs. Whether it’s their willingness to look at non-traditional credit criteria — for example, a person’s utility bill payments instead of their credit score — or their willingness to extend and/or modify loan terms, CDFIs repeatedly find ways to not just work with “unbankable” customers, but to help those traditionally marginalized customers to succeed. “There’s a myth in this country that if you’re poor, you’re unreliable,” Donna said. “If you’re poor, you have no sense of responsibility. You don’t pay your bills. We have found just the opposite. If people aren’t able to pay their loan, a CDFI is going work with them to find a workable solution to get that borrower back on their feet.”

It’s that level of trust — between CDFI lender and borrower — that’s a continuous source of wind in Donna’s sail. According to her, that trust is bolstered by ACC’s member CDFIs’ deep roots in the communities that they serve. “CDFIs know their communities,” she said. “They know the opportunities, they know the challenges, and in many cases, they’re living in the community where they’re working. There’s much more of a connectedness that you don’t often see with other types of institutions.”

In the coming years, Donna has big plans for ACC. The CDFI is in the process of doing an extensive research project to identify minority businesses in all 420 counties within its footprint to collect data and to better meet the needs of minority-owned businesses: an often forgotten demographic in an often ignored, assumed homogeneous, region. Additionally, ACC wants to grow its membership and its asset size, and Donna wants the CDFI to bring even more voices to the table that can help shape economic development in Appalachia. “We want to be the go-to organization in the region,” she said. “It’s nice to survive, but we want to thrive as CDFIs in Appalachia. We play an important role in this economy, but also in the growth of the region itself and the companies that do business here.”

Stronger Together

Instrumental to ACC’s impact has been Donna’s involvement with the African American Alliance of CDFI CEOs (the Alliance), a coalition that Donna co-founded in 2018 to strengthen Black-led CDFIs’ fiscal and impact capacity in communities across the U.S. by fostering and facilitating knowledge-sharing and expertise among group members. Donna says that the group’s formation was in direct response to the Hope Policy Institute’s research findings that there’s a $6-to-$1 disparity between white and minority-led CDFIs. While many felt that, anecdotally, that asset gap existed for decades, the data served to bring 20 Black-led CDFI CEOs to the first meeting of the proto-organization in 2018. Three years later, AAA of CDFI CEOs has 56 members — including Black CEOs from CDFI loan funds, credit unions, and venture capital funds — that represent a physical presence in roughly 30 states and provide services in all 50 states. 

Donna says that the Alliance has no plans of slowing its growth anytime soon, and the organization is continuing to expand its membership. As part of that growth, the nonprofit is working to build its organizational infrastructure, including hiring staff and building capacity. With that strong institutional foundation, Donna hopes the organization will be better supported internally to build long-term, multi-year partnerships with external funders in different industries.  Additionally, Donna says that the Alliance wants to pursue CDFI certification so that it can serve as an intermediary CDFI and make loans to its members, much as ACC does. In parallel, the pioneering nonprofit continues to make its presence known in the public policy arena, and Donna and her peers are intent on being influential in creating and implementing policy recommendations that would benefit the communities that its member CDFIs serve.

As the Alliance, including Donna in her role at ACC, continues to work to close the wealth gap in both the U.S. and the CDFI industry, Donna is as excited as ever about the role that CDFIs have to play in our country’s future. “Everybody wants to have a roof over their head, food on their table, a healthy neighborhood, and affordable health care: that is all part of the American dream,” she said. “With CDFIs, that dream is played out in real-time. They take someone’s deferred dreams and make them a reality.”

Learn More

  • Appalachian Community Capital: In 2013, the Appalachian Regional Commission and its partners committed to establishing Appalachian Community Capital (ACC) to significantly increase business lending in the region by pooling capital needs, attracting investors at a larger scale, and providing a simplified vehicle for impact investors that reduces transaction costs.
  • The African American Alliance of CDFI CEOs is the only organization leveraging African American CDFI CEOs’ decades of expertise, relationships, and intellectual capital to change the odds and the outcomes for African Americans in underserved communities across America.
  • CNote is a women-led impact investment platform that uses technology to unlock diversified and proven community investments to generate economic mobility and financial inclusion.
By Borrower Stories

How These Boba Tea Entrepreneurs Went From Working Street Festivals To Opening A Successful Restaurant

When Josh Houeye and Magen Hearn went on a date at a local Vietnamese restaurant in 2018, neither of them anticipated that a small business idea would blossom out of their boba tea. However, that’s exactly what happened. The bubble tea was so good that Josh pulled out his phone and Googled the ingredients. Impressed, he did some quick math, turned to Magen, and asked her if she wanted to sell the tea-based drinks with him. She said “yes.”

Making and selling bubble tea was a big leap for the couple: at the time, Magen was the sales director and assistant general manager at a Holiday Inn Express, and Josh had spent six years as a car salesman. Still, they didn’t let their lack of experience hold them back. Within two weeks of their boba business idea, the co