Climbing out of recession – one microenterprise at a time

This pitch started out as a radio report for Making Contact. That radio segment is here.

But it's time to take this story further. We're raising funds to do a story for KALW's Crosscurrents Radio and a print edition for SF Public Press where we are aiming to have this published.

The story will focus on the increased amount of entrepreneurs seeking support at local non-profits during The Great Recession, and how small business owners are not qualifying for government loans...It’s an untold story of nonprofits boosting up the for-profit sector, in ways that surpass top-down efforts like the America’s Recovery Capital loans.

Manuel Gomez worked as a janitor for 18 years before he got laid off. At the unemployment office, he learned about services provided by the Small Business Development Center. This local arm of the SBA, in partnership with Canal Alliance in San Rafael, taught him the ropes for starting his own janitorial company. A year and a half later, he has gained enough business to employ 14 workers in a low-income pocket of Marin County.

That’s the silver lining in this recession where we’ve seen net job losses from business closures and layoffs nationwide since 2007. In California, unemployment hovers around 12%, and desperation grows as Craigslist sucks up resumes into a big, black hole. Without enough jobs to go around, the economy needs a jumpstart from small enterprises. But you need more than a Facebook page to be a successful business. Financial training, support for startups, office space, and access to capital are all key ingredients. That’s the role played by these community organizations.

“Small business owners are lifting themselves up and lifting up people in the community around them,” says Robyn Fountain of the Renaissance Entrepreneurship Center’s office in Bayview Hunters Point, where access to credit and good jobs are scarce. In a community that has been marginalized and redlined by banks, this is a place where residents and business owners can get a leg up.

A recent study looked at the impact of Opportunity Fund, a Bay Area microlender that has lent out more than $10 million to small-scale businesses. Every dollar lent generated two dollars of economic activity in the community. Their lending has helped to create and save more than 1200 jobs in the Bay Area. Microfinance is well known for empowering women and communities abroad. As the financial crisis has choked off access to capital, lending to small business is essential to jumpstarting the economy.

Business owners like Simonida Cvejic, owner of a medical training academy, started with a small loan that would have been denied if she had gone straight to the big banks. She has trained more than 400 health care workers who are now job ready in an industry that’s better able to weather this economic crisis.

These are the stories that need to get out, about entrepreneurs working outside the box of their old jobs, and the village of community lenders and nonprofits that support them.