From crowdfunding sites to investment clubs, entrepreneurs are finding individuals willing to invest in local ventures
In January 2010, Ben Slayton and his wife, Erin Cinelli, tapped personal savings and borrowed money from their parents to buy a butcher shop in Wales, Maine. After using more of their own funds and a small loan from the state to pay for improvements, including a $20,000 energy-efficient freezer and a $28,000 poultry-processing space in the back of the shop, they struck out when they applied for bank credit to get additional equipment.Last spring the couple, who employ four workers and are projecting $400,000 in 2011 revenue, stumbled onto No Small Potatoes, an investment club comprised of 18 individuals in Maine who each contribute $5,000 to a pool that supports local, sustainable agriculture. After vetting the application and visiting the shop, the group loaned them $5,000 at 5 percent interest, with a three-year repayment schedule. Slayton, 36, says the investment helped him land further credit from other sources. “That loan from No Small Potatoes told us that people in our community think we’re a smart outfit and they were willing to put their money behind us. It was the first time that someone told [us] we were doing good work.”
1 comment:
Every community needs a small potatoes investment club.Also it would be nice to see people who made a lot of money share with others how they did it instead of taking it to the grave.
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