There is a vast amount of financing
opportunities for entrepreneurs looking to develop a business that encompasses
an individual’s passion in today’s economy. When one thinks of investment
capitalists, they usually think of big financial institutions seeking their
next hefty return on investment with a business that hits the jackpot and turns
into Mega Corporation. This is not always the case with many smaller Micro
Capital Institutions, who are actually looking to improve less fortunate
communities by providing employment, stability, housing and improving families
lives in today’s economy.
It is encouraging to know that there
are so many financial coalitions promoting credit and capital to venture
capitalists looking to start small businesses, especially in low income
communities. For example, the US Small Business Administration was recently
designed to provide $100 million in capital, along with $30 million in
operational assistance grants to 20 new markets venture capital companies in
underinvested markets. The administration’s intention is to promote
entrepreneurs, institutions and organizations to create more jobs, wealth, and
stability within these areas in exchange for a market-rate financial
return.
Community development venture
capitalists set rather lenient qualifications for the applicant looking to
develop small businesses that encourage employment rates and financial growth
in low-income areas. To apply for funding with the US Economic Development
Administration, the applicant must prove that there is a current economic
problem within the applicant’s community. Statistics need to display that the
community’s unemployment rate is at least 1% greater than the national average.
If the startup business can prove that it will encourage local development and
employment opportunities, the concept will be considered for financing.
Criteria to qualify for National Community Investment Fund includes effective organizational leadership, as well as a commitment to providing responsible and dependable products and services to the underserved area. Expectation of providing profits to the investor in a reasonable time is anticipated. Finally, a fiduciary agreement that the applicant represents the investment company in a positive light is expected.
For aspiring entrepreneurs with a clear-cut vision for a business concept within a low-income market, there are copious opportunities to obtain financing. With Micro Capital Institutions, financial opportunities have not only impacted entrepreneurial capacity, but also have improved social economies, schools and job growth. When individuals think of big time financing, they tend to think of big bank institutions, but it’s the smaller economic development organizations that are making the biggest impact on the country’s unemployment rate.
