So you want to grow a business, but you don't have the money ...
by Cape Business staffYou have your business plan in shape. You’ve studied the market and your competition. It’s time to start up your dream company or expand your operations. But a bank is not ready to give you the loan you need due to your personal financial situation – maybe not enough collateral or a poor credit history. What to do?
One emerging avenue is Coastal Community Capital. If it can’t help you financially, it may provide strategic advice on how to proceed. This nonprofit agency works to find ways to fill the gap between what a traditional lender is willing to provide and what a business needs for growth. It can leverage an extensive network of funding sources – including local banks and loans secured by the U.S. Small Business Administration – which cushion banks’ risks in lending when a credit enhancement is needed.
About 35 percent of the loans originated through Coastal Community Capital go to businesses owned by those 35 years old and younger – a critical step in keeping this age group from leaving the Cape. Another particular focus is women entrepreneurs.
Cape Business asked Coastal Community Capital to identify its six major priorities and describe how each helps individual businesses and the region’s overall economy through a particular case study.
Supporting the health-care industry through financing partnerships
Hospice & Palliative Care of Cape Cod was in the middle of building a new center when a tumbling stock market several years ago severely reduced its investment income. Coastal Community Capital established a partnership with the U.S. Department of Agriculture’s Rural Development arm and Cape Cod Cooperative Bank to find the necessary funding. The Mary McCarthy Hospice House was able to stay open in Sandwich.
Financing young entrepreneurs in business startups
Mac Hay was leasing and operating the Harbor Freeze and Harbor Grill on Wellfleet Town Pier while a college student. He wanted to purchase the properties, but did not have a down payment. Plus, the property needed a new septic system. Joined by his brother, Alex, they worked with Coastal Community Capital to obtain a startup loan. They were later named the Young Entrepreneurs of the Year by the SBA.
Helping established businesses exploit instant opportunities
The Raw Bar in Popponesset marketplace was losing potential business because of poor weather and limited indoor space. Suddenly, indoor premises next door became available and the bar’s owner, Bob Weekes, wanted desperately to expand. Yet he hadn’t planned in advance and did not have the finances in place to support the expansion. Coastal Community Capital was able to design a financial package that also included working capital for seasonal expenses.
Building wealth for women-owned businesses
Women face unique issues regarding business and financial management. It’s one reason Cape Business and the Cape Cod Chamber of Commerce will be hosting a Women @ Work conference in November. One such businesswoman is Laurie Carullo, who as a single mother, quit her job to purchase Nata’s Noodles – a producer, wholesaler and retailer of fresh pastas. Coastal Community Capital was able to help her secure financing for its relocation to Ring Brothers in Dennis – a key reason the business has taken off while employing 10 people.
Increasing technical jobs for regional economic development
Groundwater Analytical Inc. of Buzzards Bay faced a challenge because of some good fortune. It received a new contract to analyze groundwater as part of the cleanup of Otis Air Force Base. “We were in a hurry after that to finance the purchase of state-of-the-art instrumentation for the new lab,” explained Jon Sanford, one of the owners. Coastal Community Capital was able to identify and secure financial assistance through the U.S. Agriculture Department. Now, the company employs more than 50 people on two shifts.
Enhancing workforce housing for local employee
Mark Clarke, owner of MV Hardwood Floors and Martha’s Vineyard Ocean Sports did not have the 30 percent down payment banks required to purchase workforce housing for his employees – the only way he could lure and retain them given the high price of housing. Coastal Community Capital was able to partner with MassDevelopment for a loan to Clarke. The housing not only meets his operational needs, but has become a strong and appreciating asset to finance future needs.
Published in Cape Business July/August 2007
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