michael abbate- umass social entrepreneurship day 2015
TRANSCRIPT
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Michael AbbateCommon Capital
Chief Operating Officer
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About Common Capital
• OfficelocatedinHolyoke• Foundedin1990• WeareaU.S.TreasuryCertifiedDevelopmentFinancialInstitutionandSmallBusinessAdministrationMicro-lender
• ServiceareaisWesternMassachusetts• Full-timestaffof6
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FINANCIN
G
BUSIN
ESSA
SSISTANCE
PARTNERSH
IP
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TRANSFORM LIVES
STRENGTHENTHELOCALECONOMY
IMPACT
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Community and Economic Impact• Improvelivesandprovideeconomicopportunity
• Essentialcommunityservices• Rejuvenateneighborhoods• Createandretainqualityjobs• Environmentalsustainability• Localinvestment- recirculatedollarslocally,localownership,builttolast/stay
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Lending• Makebusinessloansupto$300,000• WeareanSBA– 7(a)CommunityAdvantageLoanGuaranteeLender
• Themajorityofourfundingcomesfromthefederalgovernment
• SomespecializedprogramsuchasHealthyFoodFinancingtoprovidefreshfoodretailoutletsinunderservedareas
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Types of Lending• 90%ofourloansaretofinancebusinesses• Weareanunregulatedlender• Establishedbusinesses60%/Start-ups40%• MostlyTermloanswithflexiblerepayment• Linesofcreditofferedincertaininstances• Somenon-profitlending– specialcommunityprojects,equipment,facilities
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Loan Process• Riskbasedinterestrates– prime+2-6%• Flexiblecollateralandpersonalguaranteeterms
• $100non-refundableapplicationfee,1-3%commitmentfee,closingcosts.
• Upto10yearterms
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FinancingNeeds• WorkingCapital• Accountsreceivableandinventory• Equipment&infrastructurepurchaseorimprovement• Debtrefinancingtoimprovecashflow• Purchaseofanexistingbusiness• Start-uporexpansioncosts• Realestateorbuildingrenovationtobenefitabusinessoperation.
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Partnerships• LocalBanks• Otherbusinessdevelopmentorganizations• PVGrows– Farmandfoodsysteminfrastructureloans- $1000- $250,000
• SamAdamsBrewingtheAmericanDream– Food,beverage,hospitalitybusinesses
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BusinessAdvisoryServices
• Criticaltothesuccessofourclients• Individualizedbusinessadvisoryservicesforborrowersatnocost• Providersincludeourin-housestaffandavettedrosterofconsultants
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RiverValleyMarket(Co-op)• Annualsalesof$23million• Localpurchasesof$4.2million• 7,500Co-opmembers• 145Jobs,90%Full-time• HigherwagesthanMAretailaverages• 80%ofwasterecycledorcomposted
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EnvironmentalIntegrity- Holyoke
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EnvironmentalIntegrity- Holyoke
• Createdover30FTEjobs• Recyclesoutdatedelectronicequipment• Keepswasteoutoflandfills• Reducesneedtominerawmaterials• Locatedinacommunityinneedofjobs
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RealPickles- Greenfield
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RealPickles- Greenfield• Convertedtoaworker-ownedcoopin2013• Doubledigitgrowthsince2001• 90%ofveggiepurchasesfromPioneerValley• ProductsoldthroughoutgreaterNEregion• Havewonnumerousnationalfoodawards• 95%offoodwasteiscomposted• Solarpanelssupply80%oftheirpower
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CommunityFirstFundAnopportunityforindividualsandbusinessesto
investinthelocaleconomy
• AloanismadetoCommonCapitalrangingfrom$500- $50,000
• 3yearloanterm/2%interest/renewaloption• FundsgointotheCommonCapitalgeneralloanpoolnottiedtoanyspecificloan
• Createslocalsupportforlocalbusinessesandcommunityprojects
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IMPACTL O C A L I N V E S T M E N T § S H A R E D F U T U R E