Economic development: New funds boost Ann Arbor region's microloan toolbelt
Economic development leaders and governmental officials are collaborating to provide access to $1.8 million in microloan funding for small businesses facing few traditional financing options.
The new $225,000 effort, which offers help to “high-growth startup companies” in eastern Washtenaw, aims to boost nontraditional financing opportunities in the midst of the global financial crisis.
“They’ve got to be innovative companies - as long as it is an innovative, creative idea that provides some kind of disruptive concept,” said Skip Simms, managing director of business acceleration for Ann Arbor SPARK. “Most will be technology, yes, but it doesn’t have to be.”
Loans will carry low interest rates and range from $10,000 to $50,000, and can be repaid over two to three years.
The new fund is the fourth microloan initiative in the county. The others:
-The Ann Arbor SPARK-managed Michigan Pre-Seed Capital Fund is offering $1 million in microloans to tech-based companies statewide.
-The Ann Arbor-Ypsilanti Local Development Financing Authority board has carved out $275,000 in microloan funding for companies in the Ann Arbor region.
-Washtenaw County and the Ann Arbor-based Center for Empowerment & Economic Development is preparing to distribute about $300,000 in microloans over two years to businesses run by minorities and women. CEED, which received $50,000 from the county for the project, is drawing mostly on its own borrowing capacity from the U.S. Small Business Administration to provide the loans.