Launch of Kiva Cleveland to Fuel Economic Growth Through Early Stage Business Investment

Kiva Cleveland officially launched on September 20, bringing crowdfunded microloans to small business owners and aspiring entrepreneurs in the Cleveland area. This initiative has been brought to the city through a partnership with the City of Cleveland, The Economic Community Development Institute (ECDI) and Kiva. The public may register to attend the launch event Oct. 2 at 5:30 p.m.: https://bit.ly/2kQUgNo.

“Small businesses are important to Cleveland’s economy; by providing small business owners with accessible capital, Kiva will serve as a valuable resource to local entrepreneurs,” said Mayor Frank G. Jackson. “This partnership is part of a larger effort to drive economic growth within Cleveland and support aspiring business owners.”

Through Kiva Cleveland, anyone can help grow small business and promote local job creation. To support Cleveland entrepreneurs, visit http://www.kiva.org and sign up to become a lender. From there, simply search for borrowers in the Cleveland area under the Kiva U.S. tab on the website and support them with a loan as small as $25. Small business loans crowdfunded through Kiva Cleveland are on average $5,000 and are offered at 0% interest with no fees. For borrowers who may be rejected by traditional lenders, Kiva provides opportunity.

The crowdfunding platform partnership is one of three public/private partnerships that the City worked with FUSE Corps executive fellow Aja Hardy to develop this year. ECDI is a partner in Kiva Cleveland with the City’s Economic Development department and both are providing operational and technical assistance as well as resources devoted to community engagement and scaling the program in the next three years. By building these relationships, the city is ultimately seeking two outcomes: community regeneration and wealth creation.

“ECDI is excited to partner with the City of Cleveland and Kiva to expand access to capital to the many deserving entrepreneurs in our community,” said Danielle Sydnor, ECDI Executive Director Northern Ohio. “With our one-stop-shop model for lending, coaching and training services, we are eager to assist these borrowers with accelerating their growth and pathway to bankability.”

Crowdfunded loans fill a critical lending gap faced by entrepreneurs whose businesses are too young, too small or too innovative to receive loans from traditional lenders. Nationally, small businesses create two-thirds of all new jobs and according to the Association for Enterprise Opportunity, if one in three small businesses hired one more person, the U.S. would be at full employment. There is an opportunity to build the ‘missing micro’ ladder of small, affordable loans, especially for minorities, women and individuals with lackluster credit.

“Many of the small business owners who come to Kiva have all the tools to succeed except one. They have a vision for success, a plan to achieve that success, and all they’re missing is capital,” said Sophia Zisook, Kiva’s Midwest Regional Manager. “These business owners can’t reach their goals without financial inclusion. When they see this community step up to support them, they know they are being given a vote of confidence. By lending on Kiva, you are doing more than providing capital, you are telling the small business owner ‘I believe in you.'”

The Kiva Hub City model is not new; there are 14 nationwide including Columbus, Cincinnati, Philadelphia, Kentucky and Rochester, New York. The Kiva Cleveland Hub will be part of a large network that shares best practices as they grow their markets. Internationally, Kiva’s community of 1.8 million lenders have crowdfunded $1.25 billion in loans – $25 at a time – to more than 3.1 million entrepreneurs in 81 counties and 47 US states. The repayment rate is 97%.

Partners, Supporters and Trustees

Kiva Cleveland is made possible by several area organizations joining the initiative as Sponsors and Trustees. Sponsors include the City of Cleveland and ECDI. Loan matching funds that support the KIVA loans in fundraising are still pending.

Kiva Trustees are organizations or institutions that publicly endorse entrepreneurs on the Kiva website who they know and trust in their community. Current Trustees in the City who have endorsed borrowers before and are a part of Cleveland Hub Trustee Board include: Urban League of Cleveland, ECDI, Women’s Business Center, City of Cleveland and the SEA Social Change Organization. Trustees representing the LGBTQ+, Latinx, and chamber of commerce communities are still in progress. To have an organization become a Kiva Trustee visit https://www.kiva.org/trustees/apply.\