by Joshua Jerome
BARRE — Starting up a business is challenging and rewarding. An entrepreneur needs to have a clear understanding of their competitive advantage in the marketplace and the desire to chase their dreams despite the obstacles inherent in starting a business. One such obstacle has remained prevalent for many over the last 40 years, and that is access to capital. In terms of lending, our conventional financial system is designed to work with the least amount of risk possible.
For a startup or young business with not much of a track record, accessing capital in our conventional system can be a challenge that delays growth and expansion and causes missed opportunities in the marketplace. Now, I’m not saying that every business concept and entrepreneur deserves an opportunity. However, I am saying that many risk adjusted business concepts are not given the opportunity by our conventional system. To combat this failure of our conventional financial system, alternative lenders began establishing themselves across the country and formed the Community Development Financial Institution industry.
There are several of these institutions in Vermont and for almost 20 years, Community Capital of Vermont has been working hard to fulfill the dreams of many entrepreneurs to start and expand businesses. Community Capital was born out of a program run by Capstone Community Action in the mid 90s and started out as the Central Vermont Revolving Loan Fund to help people access capital in Washington County.
Although their name has changed several times, their mission of helping small business owners and lower income entrepreneurs through flexible financing has not. In fact, their impact in central Vermont and throughout the state has increased and helped many businesses startup and thrive in our beloved downtowns. Community Capital’s offices are right on Main Street in downtown Barre and have played a very important role in the revitalization of the Granite City. Almost a dozen businesses have received financing including Next Chapter Bookstore, Morse Block Deli, Delicate Decadence and Bury the Needle Tattoo.
Last year, Community Capital was the highest volume Small Business Administration Microloan lender in New England with about a million dollars lent around the state of Vermont, including a loan to Bailey Road located in downtown Montpelier. And recently, they were announced as a recipient of a large $700,000 grant from the U.S. Treasury’s Community Development Financial Institution. The pool of peers that Community Capital competed against ranged from across the United States and is considered to be the Community Development Financial Institution Fund’s most competitive pool. For Community Capital, the award is a tremendous recognition of their tireless efforts to create financing tools that allow many entrepreneurs to make their dreams come true.
For this author, it is especially rewarding to hear of this award because over a decade ago, I sat next to my spouse as she went before the revolving loan fund board seeking financing to start up her own business; I studied the Community Development Financial Institution Fund industry in graduate school and most recently worked at Community Capital for four years ending this past December. My experience at Community Capital allowed me the opportunity to become intimately familiar with the startup process and how challenging owning your own business truly is. And, being invested so heavily in Barre, it provided me a richness of being part of something new and exciting.
Community Capital and their flexible approach to lending will always be needed and the additional business advisory services they provide set them apart from their conventional counterparts. They are an organization that must be entrepreneurial themselves as they seek to dive deeper and more broadly to further their reach and mission. Neither Barre nor Vermont would be the same without them and I congratulate them on their achievements.