Craft3 expanding on success of NCW Business Loan Fund
For nearly a quarter century, the North Central Business Loan Fund played a small but critical role in helping entrepreneurs who couldn’t qualify for traditional bank loans get their operations started. Last August, the small $2.5 million fund that has served entrepreneurs in Chelan, Douglas and Okanogan counties, was acquired by the significantly better funded Craft3, a nonprofit that operates in Washington and Oregon.
Rich Watson, the Chelan-based former commercial banker and Peace Corps volunteer who oversaw the Business Loan Fund, was there to provide context. Watson is enthusiastic about the ability of Craft3 to use its resources to make loans that will strengthen community resilience in our region. One of the things Craft3 brings to the table is the ability to knit together resources from commercial banks, government, nonprofits and other sources in creative ways to help businesses get started or expand.
Craft3 generally makes loans for up to $3 million, but can stretch that limit even higher, far more than the NCW Business Loan Fund was able to handle. Seip and Reilly said they are in the process of learning about the needs of the region so that they can target funds where they will make the greatest impact. The lack of affordable housing is an issue that has piqued their interest. Of course, that’s an issue all over the Northwest rather than just North Central Washington. They are interested in learning if there is a role for Craft3 in dealing with that issue.
Here’s an example of the kind of creativity Craft3 can bring to a project. A group of nonprofits got together and wanted to buy a notorious piece of property called the Sugar Shack in Portland that had been home to a number of, shall we say, adult entertainment businesses. With the financial help of Craft3, the nonprofits are in the process of turning what was a public blight into a center with vital community services, such as a center for affordable housing, a child care center for low-income residents, some office space for incubating small business and the like. It was not a project that commercial banks with their loan underwriting rules would be likely to support.
The beauty of Craft3 and other nonprofit financial organizations is that they can look at the context of a project and see the community value. Banks typically are focused almost exclusively on the numbers.
Seip, a Seattle-area native, said Craft3 started in the mid 1990s on the Washington coast in the midst of the timber wars, when the operating theory was that you could choose a strong economy or a strong environment. That, he said, is a false choice.
What I like about the work that the NCW Business Loan Fund has done and that Craft3 is furthering is that these organizations are providing the financial lubrication that can help people with great ideas but limited means to become successful. These organizations are, at the end of the day, all about building a sense of hope and confidence in the future.
When Craft3’s work is done with a client, they hopefully graduate to using commercial banks as lenders after having established a track record. Seip and Reilly are listening and connecting with people in North Central Washington to find strategic opportunities to build community resilience. That’s the right approach.
I’m anxious to see Craft3 make a difference in our region.
Rufus Woods can be reached at firstname.lastname@example.org, or 509-665-1162.