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Published in Small Business

Grand Rapids microlender rebrands, aims to increase small business lending

BY Wednesday, July 20, 2022 08:31pm

GRAND RAPIDS — A Grand Rapids-based microlender has rebranded from Grand Rapids Opportunities for Women to Grow as it focuses on increasing the number of loans it deploys to small businesses. 

Grow also is among Community Development Financial Institutions (CDFI) receiving state funding under a budget deal signed today by Gov. Gretchen Whitmer. Founded in 1989, the organization has been a CDFI since 2016 and will receive a share of $75 million in state CDFI grants. 

Milinda Ysasi. COURTESY PHOTO

“This is a significant investment for the CDFI industry in Michigan,” Grow CEO Milinda Ysasi told 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 familiarize more small businesses with the organization, Ysasi said.

“A lot of people think of us for just our programmatic efforts, but this is really us saying we are a lender and understand the dynamics that businesses will need multiple types of lending and capital,” Ysasi said. “We’re also letting people know 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, assisting 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 their gender, Ysasi said. 

The organization is one of 147 microlenders in the country that provides small business loans of up to $50,000 backed by the U.S. Small Business Administration. 

Grow also has received funding from the U.S. Treasury Department’s CDFI Fund, including $200,000 in 2021 through the Fund’s Rapid Response Program that delivered $1.25 billion in capital in response to the COVID-19 pandemic. Grow in 2020 received $400,00 from the Fund in financial assistance, which is matched with non-federal funds, and $125,000 in 2017 for technical assistance to build capacity, according to the Treasury Department. The organization reported more than $2.38 million in total assets in its 2020 annual report.

Grow has worked to deploy this funding for small businesses that traditionally have lacked access to capital. Its previous clients include various types of retailers, restaurants and consulting businesses.

“As we look at the dynamics of business lending, it usually is not going to women, people of color, refugees and immigrants,” Ysasi said. 

Grow deployed $937,184 in funding to 69 businesses over the last two years. Women-owned businesses made up 73 percent of the loans, and 27 percent of the recipients were women of color. Low-to-moderate income business owners also made up 69 percent of the loans.

The organization has a goal of increasing the business loans it issues this year to 96, and to lend more than $1.9 million in the next five years, Ysasi said.

“We want to be there to elevate entrepreneurs,” Ysasi said. “Our average loan size is $8,500, and some people say that’s not that much money. But for a small business, that could mean hiring someone new, providing more cash flow or purchasing new equipment.”

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Read 3096 times Last modified on Thursday, 21 July 2022 09:29
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