GRAND RAPIDS — A Grand Rapids-based microlender moved from Grand Rapids Opportunities for Women to Growing up as it focuses on increasing the amount of loans it deploys to small businesses.
Grow is also among the Community Development Financial Institutions (CDFIs) receiving state funding under a budget agreement signed today by Governor Gretchen Whitmer. Founded in 1989, the organization has been a CDFI since 2016 and will receive a share of $75 million in state grants from the CDFI.
“This is a significant investment for the CDFI industry in Michigan,” said Grow CEO Milinda Ysasi. MiBiz.
The budget allocation is the first of its kind for Grow and will significantly help the organization’s mission as it seeks to expand under a new brand and introduce more small businesses to the organization, Ysasi said.
“A lot of people think of us purely for our programmatic efforts, but it’s really us saying we’re a lender and understanding the dynamics that businesses will need multiple types of loans and capital,” said Ysasi. “We’re also letting people know that we’re not just for Grand Rapids, and we’re not just for women.”
Grow has a racial equity lens and focuses on historically disadvantaged groups, helping many women of color with business loans. With its rebranding effort, Grow aims to expand its lending to business owners unable to connect to traditional funding sources, regardless of gender, Ysasi said.
The organization is one of 147 microlenders nationwide that provides small businesses with loans of up to $50,000 backed by the US Small Business Administration.
Grow also received funding from the US Treasury Department’s CDFI Fund, including $200,000 in 2021 through the Fund’s Rapid Response Program which provided $1.25 billion in capital in response to the COVID-19 pandemic. 19. Grow in 2020 received $400,000 from the Fund in financial assistance, which is matched with nonfederal funds, and $125,000 in 2017 for technical assistance to build capacity, according to the Treasury Department. The organization reported over $2.38 million in total assets in its 2020 annual report.
Grow has worked to deploy this financing for small businesses that have traditionally lacked access to capital. His previous clients include various types of retailers, restaurants and consultancy firms.
“When we look at the dynamics of business loans, they generally don’t go to women, people of color, refugees and immigrants,” Ysasi said.
Grow has deployed $937,184 in funding to 69 companies over the past two years. Women-owned businesses accounted for 73% of loans and 27% of recipients were women of color. Low-to-moderate income business owners also accounted for 69% of loans.
The organization aims to increase the number of business loans it disburses this year to 96 and lend more than $1.9 million over the next five years, Ysasi said.
“We want to be there to uplift entrepreneurs,” Ysasi said. “Our average loan size is $8,500, and some people say it’s not that much. But for a small business, that might mean hiring someone new, providing more cash, or buying new equipment.
Never miss the biggest stories and breaking news from MiBiz. Sign up to receive our reports straight to your inbox every weekday morning.