ASHEVILLE – Randy Siegel isn’t exactly a fan of wake-up calls — the call part, anyway.
But he does champion the wake-up.
“You hate wake-up calls, especially as you are going through them,” said Siegel, a professional development specialist. “But when you wake up, it sure does make a difference.”
Mountain BizWorks, a nonprofit that helps local small businesses start, grow and create jobs through loans, classes and coaching, had a big wake-up call in November, said Siegel, who is on the agency’s board of directors.
The 25-year-old nonprofit suffered a severe liquidity crunch after a drop-off in revenues. Around that time, CEO Shaw Canale resigned, and the nonprofit had to restructure and refocus, which included laying off eight staff members.
“We got to the point where we were never in crisis mode, but we were not sure that we had enough cash in hand to sustain” all the programming and other offerings in the immediate future, he said.
But in the six months since, the once cash-strapped organization has had the “best six months,” Siegel said.
The organization provided 36 loans to the tune of more than $714,000. It provided more than 650 training hours benefiting more than 185 entrepreneurs and produced more than 150 jobs in the region, not including the number of jobs that have been maintained by resources and programming.
And it’s about to create one more job in the region: The group recently announced it is seeking a new executive director.
“I think it’s a good situation to put a new executive director in,” said Eileen McMinn, board chair. “We are not looking for an executive director to pull us out of a crisis; we want someone who will marshal the assets that we have and will move us forward in a positive way.”
So how did the nonprofit benefiting startups restart itself? With the help of an outside consultant.
With consulting from Marc Hunt, the organization learned how to be more streamlined, strategic and sustainable, Siegel said.
“We really drilled down,” he said. “We needed to do what we did best, and avoid duplications of services (with other organizations).
“We needed to realize that resources are limited,” Siegel said. “We needed to focus on what was the greatest need.”
That great need for entrepreneurs? Funding, he said.
In a way, it’s a return to the nonprofit’s roots. It started in 1989 as the Mountain Microenterprise Fund, which initially focused on small loans for startups and providing basics for would-be entrepreneurs.
This spring, the loaning refocus received a big boost: The federal Small Business Administration recently approved $1 million in loan capital, which in turn will be used for microloans for small businesses.
Asheville’s Jonathan Scales has received two loans from Mountain BizWorks in the last year.
He considers his jazz band, Jonathan Scales Fourchestra, to be a small business, he says, noting that the employees are the band members.
He attempted to go to a bank for a loan, but was denied.
“It’s like a human relationship, you get to sit face-to-face (and explain your situation),” Scales said of his experience of Mountain BizWorks. “It’s not just a computer algorithm.”
Scales’ loan also benefited people outside the band, he noted.
In the creation of the album and supporting concert tour, he hired visual artists, photographers, other musicians, T-shirt makers and mixing engineers.
“While we were recording the album, I was meeting with Mountain BizWorks,” he said. “If they had said no, I don’t know where we would be today.”
The latest album, “Mixtape Symphony,” was released last week, and it reached No. 6 on the iTunes jazz charts.
“There are a lot of people with great ideas with hopes and dreams that need funding,” Scales said. “And you won’t be able to get it from a normal bank for one reason or another.”
Mountain BizWorks staff and board hasn’t just added money to the nonprofit’s loan reserves in the past six months; the group also had to cut expenses. Some expenses were easier to eliminate, such as subletting half of the office space and cutting back on equipment use.
The Mountain BizWorks restructuring did come with some tough choices, Siegel noted.
“Trimming the staff was very painful,” he said. “ … We streamlined programs; this was difficult.”
That streamlining included cutting the popular Foundations courses, which taught entrepreneurs basic business skills. These cuts totaled savings of around $50,000 a month.
“Every nonprofit, and certainly when you feel like you have a mission-driven organization, you want to do everything for everybody,” said McMinn. “You want to do everything for everybody. It’s hard to admit you can’t do everything for everybody.”
Ajani Eagledove, who owns and operates Eagledove Greenhouse and Garden Center with his wife, Mayo, was one of the last graduates of Mountain BizWorks’ Foundations courses.
“Every day we come down and we are amazed that we got this much done so fast,” he said. “Every day, we are blessed. … At first, we were really overwhelmed and nervous about doing it … I don’t think I would have tried this without taking this course.”
The Eagledoves have run an organic farm feed business on Swannanoa River Road for three years, but wanted to expand and make their business a larger part of their life. Mainly, they say, because the couple wanted to be able to spend more time with each other.
After clearing the bamboo forest on the property about a year ago, the duo have been steadily adding new services and products.
They offer landscaping services and sell farm feed. They have chickens and ducks, and sell eggs in the barn, along with lawn art. They offer you-pick flowers, and will soon offer hydroponic pond-raised tilapia.
Building a business on diverse products and services is one of the lessons from Mountain BizWorks, the Eagledoves said.
“There is no one big money maker with farming, there just isn’t,” Mayo Eagledove said. “We had to learn the business part of making it work. It’s not one thing.”
Mountain BizWorks experts continue to be a resource for the duo. Ajani Eagledove says he continues to ask for help with issues, and the nonprofit staff helps connect him with experts and solutions.
Another important resource: Encouragement.
“They have encouraged us; they say you can do this,” he added. “With a game plan, they say you can do this.”
Mountain BizWorks preliminary financial figures for 2013
• $5.3 million in total assets.
• $4.2 million in total liabilities.
• $1.2 million in revenues and contributed support.
This information is preliminary, said Jamie Beasley, who handles development, marketing and operations for the nonprofit. “Our 2013 audited financial statements will be ready in a couple of weeks and available on our website,” he said.
In November, the nonprofit laid off eight employees. In March, the group hired one back. The nonprofit is also seeking a new executive director. Eight staff are now listed on the website.
Since 1989, Mountain BizWorks has provided $9 million in loans to 715 small business owners who otherwise would not be able to get the financing to start or expand, creating 3,500 jobs in Western North Carolina.
Mountain BizWorks raises both loan (investments) and operating capital from a variety of sources including banks, foundations, businesses, religious institutions, government entities and individuals.
Investors can invest as little as $1,000 and choose terms as short as one year or as long as 10 years. Investors receive a fixed-rate annual simple interest return of 0 percent to 3 percent. More than 40 individuals have provided more than $400,000 in investment in the loan fund, Siegel said.
Mission and more
“Mountain BizWorks’ mission is to generate jobs and stimulate economic opportunity in Western North Carolina by helping small businesses start, thrive, and grow. We do this by providing loans and peer-to-peer business coaching to those businesses that are unable to secure funding from banks and other traditional sources,” according to the website.
Mountain BizWorks is a U.S. Treasury-certified nonprofit community development financial institution (CDFI). For 25 years, Mountain BizWorks has been making business loans ranging from $1,000 to $150,000 to small businesses in WNC who are unable to secure funding from banks and other traditional sources.
All loan decisions and relationships are managed locally, and the nonprofit offers highly customized, peer-to-peer business coaching.
Mountain BizWorks provides business loans and coaching to emerging and established small businesses in WNC.
“We have a particular focus on working with businesses unable to access financing from banks and other traditional sources, as well as low-income, minority, women, and immigrant entrepreneurs, and businesses that operate within the local food system,” according to the website.
For more, visit www.mountainbizworks.org.
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