WACO, TX — Startup Waco is the first organization in Texas to connect local small business owners with Kiva, a nonprofit organization that uses a crowdfunding concept where the community can fund loans to local businesses.
Startup Waco has experts that can assist and guide people through Kiva, from how to qualify to how big of a loan they can receive and when.
Kiva offers $0 fees and 0% interest loans to small businesses with loans ranging in size from $1,000 to $15,000. They also require borrowers to obtain support from their local community by raising microloan commitments from friends, and family and neighbors.
This Kickstarter approach accepts loan commitments beginning at $25.
"Kiva is a very elegant solution to try to provide much needed funds quickly to entrepreneurs that don't otherwise have access. I think it's amazing to see the community come together. The structure was needed. The platform was needed, and it's just allowing people to participate in a way that wasn't possible," said Jon Passavant, Startup Waco CEO.
"This is primarily built to have the community invest in businesses in the community, so ideally, every deal that we get to work with can be funded both through the support of Waco and abroad," Gib Reynolds, Capital Access Manager for Kiva, told Startup Waco.
Community members who are willing to be lenders chip in, and if you raise your goal in time, the loan is yours with no catch.
Handcrafted beverage company Waco Cha was the first local business to try out Kiva. They were able to get their $15,000 loan funded in less than two days.
"It was very shocking, and it was incredible seeing the support from our community and family and friends of course," said Devin Li, Waco Cha CEO.
Waco Cha started as a food truck then opened their shop on 1001 Franklin Ave. Now, thanks to the loan, they're now planning on expanding into Temple.
"Funding is huge for small businesses because without capital you can't grow to the next stage or it takes a long time so this certainty helps," said Li.
Kiva is an all-or-nothing fundraiser of sorts, so if you don't meet your loan goal in the time allotted, you won't receive the money and it'll go back to the lenders.
But if things go well, the loan is yours and lenders will get their money back in the time agreed to in the contract.
"I think because we're the first organization in the state of Texas to stand this up, I think we've got a clear lane to run in. Right now we're targeting to get 10 businesses a month to fund, but I think that could get into hundreds of businesses that we could help throughout the course of the year," said Passavant.
For those looking to get involved, Startup Waco will host a webinar on February 17 from 12 p.m. to 1 p.m.
This webinar is open to the public. People can register by visiting the Startup Waco website.