The article below appeared in the July 13th edition of Providence Business News.
“Nonprofit microlender the Capital Good Fund was founded by Andy Posner, who recently graduated from Brown University with a master’s degree in environmental studies. The fund, based in Providence, makes loans of between $500 and $3,000 to entrepreneurs and immigrants interested in applying for U.S. citizenship. Posner, the fund director, recently answered a few questions about the venture.
PBN: Give us the details about the fund.
POSNER: Our mission is to create a poverty-free, inclusive green economy through innovative microfinance. We provide loans and workshops to lower-income Rhode Islanders for a variety of purposes so that they can better their lives, their communities and the environment. Capital Good Fund is the only lender in Rhode Island that makes unsecured loans with no minimum credit score requirement.
The best way to illustrate what we do is to talk about our borrowers. Take Curtis Gomes, for instance, who graduated from our business basics workshop (which we hosted in partnership with the Providence Housing Authority), and then took out a small business loan from us. All he needed to get his general contracting business off the ground was $3,000 to purchase insurance, some tools and a computer. Or, consider the case of Toni Lynn Bonadie who, with a $750 loan, started a yoga company. There is also Ducy Cornejo, who took a $3,000 loan to start an environmentally friendly cleaning company a year ago and, after paying off her first loan, has now taken out a second, larger loan, in order to expand the business. These are just three examples of the 29 life-changing loans we have made to date.
PBN: What are your lending criteria?
POSNER: We have a set of four qualitative underwriting criteria that we use to evaluate the loan applicant. We also have group loans where a group of people get together to support each other’s businesses; in those cases, the group decides who is approved for the loan.
The questions we look at are: 1) Do they need the loan? 2) Can they afford the loan? 3) Are they likely to repay the loan? 4) Are they likely to succeed with the loan?
To answer these questions, we look at a basic business plan, references, character, credit, etc.
Out of the $47,625 lent out, we have only written off $1,500.
We currently have more than $50,000 in our loan pool. That won’t need to be replenished because our default rate is so low.
PBN: Who has supported Capital Good Fund?
POSNER: The support of Brown University has been absolutely essential. In particular, Alan Harlam and the Swearer Center for Public Service have provided us with financial, moral and intellectual support. In addition, we wish to thank Kurt Teichert and the Community Carbon Use Reduction at Brown program for supporting our innovative, energy-efficiency loan program – the DoubleGreen loan – as well as the Small Business Development Center, English for Action, the International Institute of Rhode Island, Providence Housing Authority, the R.I. Economic Development Corporation, to name a few.
PBN: How does Capital Good Fund fit into the broader social enterprise landscape in Rhode Island?
POSNER: I’ve heard other entrepreneurs describe Rhode Island as a “petri dish” for new ideas, and I couldn’t agree more. I came here from Los Angeles to get a master’s degree, and by the time I graduated I knew that I had to stay. After all, where else can someone get such easy access to so many business, political and community leaders? Rhode Island is small enough to be manageable yet big enough to offer all the things an entrepreneur needs: a community of intelligent people, challenges that need to be addressed, and proximity to larger markets (e.g., Boston). That’s why I am proud that fund was part of the first graduating class of the Social Venture Partners of Rhode Island’s Change Accelerator program. I see Rhode Island as a hub of social enterprise nationwide – a trend that will create jobs and attract investment in the state.
PBN: What role do you see microfinance playing in addressing the economic crisis Rhode Island is facing?
POSNER: The beautiful thing about microfinance is that it allows people to take charge of their lives and their destinies; rather than hope that someone hires them, our borrowers start or expand business ventures in order to make a living on their own. It never ceases to amaze me the extent to which our borrowers – who are people that have been disadvantaged in myriad ways throughout their lives – are eager to help others in their communities through entrepreneurship. So the benefits of our loans are tremendous: They allow people to increase their income immediately and create jobs for others; they provide hope and opportunity at a time when both are lacking; and they even save taxpayers money by reducing the need for public benefits.
Now, microfinance isn’t a silver bullet. But when you think about how many people are seeking jobs compared to how many jobs are out there, the numbers are simply daunting. These microbusineses are an important part of the economic recovery and, once established, they help to create a dynamic local economy that will be more protected from future economic shocks.”
New Borrower Profile!
Wednesday, June 30, 2010
We just completed another profile of yet another of our inspiring borrowers—Curtis Gomes of Curtis Gomes Painting & Construction. Click here to read the profile! And if you need any work done on your house be sure to contact Curtis!
CGF Update: Our Work to Date, By The Numbers
Sunday, June 20, 2010
Here’s our latest update on our accomplishments, by the numbers: we have made 28 loans totaling $47,165 (with only one default, of $1,500), and we have graduated 24 people through our business and financial literacy workshops. Not bad for our first year of operation. And now that we have two more full-time employees, we expect to see continued rapid growth.
Photos and Stories Of Recent Loans
Friday, June 18, 2010
In the last few weeks we have rapidly grown our loan portfolio, making 6 loans and bringing our total to 27 loans equaling $45,000. Four of these loans have been part of our innovative—and life-changing—partnership with Amos House (a fantastic social services agency in Providence), in which we provide capital to clients of theirs that have job offers (or offers of increased hours at their jobs), but need a drivers license to take advantage of those opportunities. Due to fines and fees associated with reinstating their licenses (about $1,000) these hardworking individuals are unable to get their licenses back. In response, CGF and Amos House created a group of seven handpicked individuals that meet weekly to support one another, request loans and make payments, and learn about financial literacy. The group-lending program has facilitated a forum for members to talk about their long-term financial and personal goals, which has inspired some group members to start saving up money in order to open a small business down the road.
We have given four loans to graduates of the Amos House Culinary Education Program. Borrower Troy Stevens is now able drive to and from work in the evenings after public transportation stops, and has increased his work hours a local restaurant as a result. Ruben Alicea is now a more valuable employee at a local café and has received a raise because he can now assist the business with emergency food pick-ups and catering. Additionally, borrower Damon Fowlkes, trained in carpentry, has just been hired by a landscaping company since he can now drive to and from clients’ houses. And borrower Nelson Rojas is able to work at two different locations for his storage company as a result of the reinstated license. He is grateful to be able to use the extra money to support his two-year-old daughter. All members of our “access-to-employment” loan and support program are excited to continue meeting for the next year, and the Capital Good Fund is grateful to be working with such inspiring borrowers and such a supportive organization like the Amos House.
CGF Is Revelation to Action Finalist!
Friday, June 11, 2010
The Capital Good Fund has been accepted as a finalist in Ashoka’s prestigious Revelation to Action contest! The competition aims to “find and help fund creative solutions for motivating local citizens to strengthen communities across New England and New York.” From an applicant pool of 358 organizations, CGF was chosen as one of fifteen finalists. Winning this award would help us to support our innovative Double Green Credit Builder Loan! The top ten winners will receive $5,000, so support CGF by voting for us at http://www.changemakers.com/en-us/revelation.
A Story of Hope
Monday, May 31, 2010
Our loans are transformational in ways that go beyond quantitative measures. They open doors, give hope, connect people to opportunity and each other. Take Delia, a citizenship borrower (see her borrower profile by clicking here). Like so many others, she has been struggling to find work. After months of searching she recently found a part-time job. Unfortunately, a few days later—the same day her daughter in Bolivia graduated from High School—she had to be rushed to the hospital for an emergency medical procedure. She found out afterwards that had she arrived 5 minutes later, she would have died; and were it not for medicaid, she would have spent the rest of her life paying off the debt.
Andy Posner visited Delia several weeks after the surgery to check in on her. She was doing better, but still in a lot of pain. She lamented the fact that just when she had gotten a job she had to quit it due to illness. Now all she could do was wait for her body to heal and plan her next steps. As they talked, Andy realized that another borrower—Ducy Cornejo of Green Cleaning Systems—had recently taken out a second loan from CGF and was quickly growing her business. After a short call Ducy confirmed that she would be happy to hire Delia in her cleaning business when she is ready.
More conversation revealed that Delia wants to take CGF’s business basics course. The reason? She is an amazing cook, and wants to start her own pushcart business, selling authentic Bolivian food throughout Providence. As she talked about her dream and saw the steps that could lead her to realizing it, Delia forgot about her misfortune, forgot about her pain, and focused on the future—a future looking more hopeful thanks to her resilience and a small loan from an organization dedicated to a better future for all.
Interested In Working for CGF? We’re Hiring!
Saturday, May 15, 2010
Interested in Working for an Innovative Microfinance Organization? The Capital Good Fund is hiring!
Founded by a dedicated group of Brown students, the Capital Good Fund (CGF) is a non-profit micro-lender which serves low-income individuals in the state of Rhode Island. With an all-volunteer staff and very few expenses, CGF began as a dream in a social entrepreneurship class at Brown University. Within a year, CGF has established itself as the largest student-run microfinance organization in the country.
The Capital Good Fund’s mission is to create a poverty-free, inclusive green economy through innovative microfinance. CGF offers loans to entrepreneurs to start or expand small businesses, to permanent residents seeking to become citizens, and to low-income Rhode Islanders with poor credit. These loans are unique from ordinary micro-loans, however. CGF holds its borrowers accountable to the environment by emphasizing a “green” element to each loan.
In just one year, CGF has won over $60,000 in grants and has expanded its public profile to new heights. In fact, just recently on national television former President Bill Clinton highlighted the organization as a model for innovative entrepreneurship. With over 22 loans given out, for a total of $38,000, CGF is excited to expand its services in the coming months.
As the organization grows and its client base increases, CGF is looking to hire two committed and passionate AmericaCorps VISTAs by June 1st. Listed below are the descriptions for each position. If you are interested, please contact CGF via email ((JavaScript must be enabled to view this email address)), by phone (866-584-3651), or apply directly through the AmeriCorps system. PLEASE NOTE: We are looking for VISTAS who are fluent in both Spanish and English.
1) Loan Officer:
As a loan officer for the Capital Good Fund (CGF), the VISTA will work in a high impact and hands-on role in the organization. Duties include recruiting, meeting, and working with applicants; processing applications to be screened by CGF’s loan committee; reporting loan committee decisions to the applicant; and staying in contact with borrowers throughout the repayment of the loan. CGF’s goal for the VISTA is that they will have made 30 credit builder loans, 20 citizenship loans, and 10 business loans by the end of their service. This position requires a passionate and charismatic person who has the ability to interact with a wide variety of people, to listen to their stories and needs, to go through their credit reports, business ideas, financial histories, to speak to their references, and to make a judgment on their viability as loan applicants. This is a unique opportunity to work in the exciting field of microfinance with an innovative organization in a community— Greater Providence, Rhode Island— that desperately needs the services CGF offers.
2) Business and Financial Literacy Trainer:
As the Business and Financial Literacy Trainer, the VISTA will recruit participants for CGF’s business and financial literacy courses, as well as teach and evaluate the workshops. These workshops serve several goals: first, they prepare individuals for CGF’s loans by providing them with the knowledge and skills they need to succeed in establishing successful businesses and in managing a CGF loan; second, they offer existing clients an opportunity to learn more about financial matters; and lastly, they enable CGF to reach non-clients with important information on financial responsibility and the basics of starting a business.
CGF Featured in the Providence Phoenix
Thursday, May 13, 2010
CGF was featured in an article in today’s Providence Phoenix. The article, titled ‘A Providence non-profit loans out the future,’ highlights our innovative loan programs and their impact on our borrowers You can read the article by clicking here
CGF Mentioned In Local NBC Story on the Rhode Island Economy
Monday, May 03, 2010
Capital Good Fund is mentioned starting at around the 40 second point into the segment!
CGF Wins Brown Business Plan Competition—Social Venture Track!
Last Saturday, May 1st, Capital Good Fund won the Brown Business Plan Competition in the Social Venture Track. CGF was one of 6 amazing finalists, and we are honored to have been chosen as the winners. Our plan focused on how to scale up our first-of-its-kind DoubleGreen Loan Program, as well as how the loan fits into our broader organizational strategy. The award includes a cash prize and in-kind services (such as consulting), and we are confident that this news will serve as a springboard for taking CGF to an even higher level of social and environmental impact!
