A non-profit organization responsible for millions of dollars in loans around the world is bringing its microlending to the small businesses of Los Angeles.
The June jobs report -- which revealed employers added 80,000 jobs that month, keeping the unemployment rate at 8.2 percent -- was another sign the economic recovery is in a summer slump.His group has now partnered with Kiva, a non-profit lending site located in 60 different countries around the world.
But microlending is part of a push to support local small-business owners who are finding new ways to succeed in a struggling economy.
Nearly a year ago, Yesenia Monroy opened Cafe 22, a natural foods breakfast and lunch spot in Boyle Heights.
"Our dream was to bring something fresh and healthy to a desert of fresh food," Monroy said.
The pregnant mother of two says it is a dream almost not realized because banks refused to offer her a $15,000 loan. Local small-business lender Valley Economic Development Center (VEDC) stepped in but the business was growing so much that she needed a delivery driver.
For the $5,000 she needed to create that position, Monroy turned to the Internet.
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"Crowd funding allows the average Joe to say you know what I want to be involved in helping grow small businesses," said Roberto Barragan, president and CEO of VEDC.
Since launching in 2005, Kiva has orchestrated $327 million in loans through more than 750,000 lenders around the world.
The newly minted LA operation is the third US city, behind Detroit and New Orleans, to open.
"Small businesses are the backbone of our local economy," said Mayor Antonio Villaraigosa in a statement. "There is no shortage of passionate and successful small business owners in Los Angeles who, collectively, have the power to accelerate job growth and economic opportunity for all of us."
LA has the largest small business community in the United States, home to more than 325,000 small businesses, according to Kiva.
The Kiva City LA program has partnered with Visa, Valley Economic Development Center and the Los Angeles Mayor's Office of Small Business.
How Kiva Works from Kiva on Vimeo.
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Kiva launched its LA initiative on June 26, and so far has 13 borrowers requesting loans ranging from $2,000 to $10,000.
The site works like this: Small business owners request loans from one of Kiva's lending partners, which then uploads the request to kiva.org. Users browse borrowers' profiles and can choose which ones to lend to. The entrepreneurs repay the loan, and kiva.org users are reimbursed.
