The concept of the Near Westside Initiative's microloan program is about as simple as it gets: make it easy for neighborhood businesses to find space, funding, direction -- whatever they need -- to help them make an investment into the neighborhood. And everyone wins.
"I'm all about getting the businesses the resources they need," said Michael Short, deputy director of the Near Westside Initiative. "If I help you, and you move into the neighborhood and your business expands and you've renovated a building, then we've all succeeded, together."
The microloan program is an innovative, comprehensive system that puts entrepreneurs looking to start or expand a business on the Near West Side on a fast track to realizing their goal.
And this month the NWSI announced that roughly 30 businesses are currently seeking eligibility, with the first loan, of $12,000, awarded to a caf project at the expanding Red House Arts Center/SubCat Studios complex.
Nuts and bolts
The microloan program has roots in a summer internship Short had in 2009, for which he knocked on the doors of all 140 West Side businesses to conduct a survey.
The results shocked him: in the midst of an economic crisis, 35 percent of West Side businesses wanted to expand, but they needed help.
Short said business owners felt isolated, they felt alone, they felt like there was no one there to help them so they just focused on themselves.
So the first step was to organize a business association and create a community for entrepreneurs; the Near Westside Initiative Business Association held its first meeting last July.
The next step: securing a $25,000 grant through Community Foundation, seed money for the NWSI to create a loan loss reserve with Cooperative Federal Credit Union, which opened up $100,000 for microlending.
The move quadrupled available funds and created a revolving microlending program. As loans are paid back, the money recycles back into the lending pool so microloans will be continuously available. If borrowers default on their loans, the $25,000 loan loss reserve is there as a cushion to keep the bank paid.