When New Jersey entrepreneur Liz Migliore founded Jersey City Veggie Burgers in 2012, she did it on a shoestring budget, working out of kitchens that rented her space and equipment by the hour. As most startups, she was continually concerned with how to grow her business with limited capital. Then she learned about KivaZip.org, an online lending platform that provides entrepreneurs and small business owners with zero interest loans. Loans that they otherwise would be unable to obtain from a traditional lending source such as a bank.
Launched in the US and Kenya in 2011 KivaZip.org is a division of the international non-profit organization Kiva.org that was founded in 2005 to help entrepreneurs in poverty-stricken countries via a network of micro lenders. Kiva Zips web based platform, unlike Kiva.org, connects small business owners directly to those individuals who crowd fund the loan through small contributions.
What is particularly unique about Kiva Zip is that borrowers are vouched for by a network of trustees, foregoing the use of a credit score to establish creditworthiness. In just three short years Kiva Zip has made nearly $4 million in loans to 4,000 small businesses using this credit model. It boasts a 95% success rate of borrowers reaching their full funding goal in the designated 45 day funding time period. Successful campaigns tend to have the support of friends and family of the borrower who donate and spread the word.
Migliore feels KivaZip.org was key to putting her business on a new and better course. -The loan helped me obtain, and outfit a kitchen of my own. This opened the door for me to exponentially increase my production capacity and work in a more efficient manner. In the coming year I plan to expand my wholesale business, and pick up more grocery and restaurant accounts. Tasty, healthy veggie burgers will be on more plates thanks to Kiva Zip!-
Stories such as Liz Migliores are what keep Kiva Zip co-founder Jonny Price so highly motivated and enthused about their alternative funding platform. He extolls Kiva Zip as one of the true positives that has emerged from internet technology. -We see Kiva Zip addressing three very fundamental needs of small business owners. First, it is character based lending that overcomes the hurdle of low credit scores that many small business owners have which prevents them from obtaining a traditional bank loan. Second, technology provides new efficiencies that significantly lower lending costs. So much so that we offer zero percent interest and no fees on Kiva Zip loans. Third, we are connecting people around the world that otherwise would not connect, so it is not just about lending but about empowering people through new connections. We see this as helping small businesses in a totally new way.-
Kiva Zip attracts a diverse array of small business owners in sectors ranging from agriculture, education, retail, and countless others. Therefore, it draws in a diverse set of lenders who often have an interest in or knowledge of the borrowers industry or business model. The Kiva Zip platform makes the process of making loan contributions easy. It may take as little as two minutes.
Spreading the word about their new funding platform is very important to the Kiva Zip team. They have set up a Kiva Zip Fellowship Program that is a network of unpaid volunteers who promote and expand Kiva Zips reach at the local level. Currently, fellows for Kiva Zip are campaigning in New York, New Jersey, Philadelphia, and several other cities throughout the country, making it known to both small businesses and potential lenders.
Entrepreneur Migliore sums up the Kiva Zip experience in a way that bodes well for the platform. -Kiva Zip was a wonderful opportunity for me to expand my business. On a shoestring budget I might have continued humming along at the micro level for a long time. With the Kiva Zip loan, it was an opportunity and a challenge for me to take my business to the next level. It also gave me a sense of responsibility to make most of the opportunity. I literally have people backing me, and I want to make them proud.-
