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Matt Holton Matt Kim Erin Malone Claire Williams.

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Presentation on theme: "Matt Holton Matt Kim Erin Malone Claire Williams."— Presentation transcript:

1 Matt Holton Matt Kim Erin Malone Claire Williams

2 Small business is America. 3,624,614 establishments with 0-4 employees in the United States Annual payroll of more than $232 billion

3 Small business is Oregon. More than 316,000 microenterprises in Oregon 86% of total businesses in the state Small business is Lane County. Approx. 180,000 people in Lane County employed by microenterprises 32,000 microenterprises in the area

4 What’s broken? Small businesses need capital Communities need local development as recession buffers Inefficiencies with the way small business get access to capital

5 For example...

6 Best option. Microenterprise Development Organizations (MDOs) assist small businesses start by providing training, technical assistance and/or small amounts of capital. But... Reliant on grant funding Limited Capacity

7 Opportunity comes calling. Develop a way to connect small business owners to investors while drawing on the expertise and assistance provided by MDOs. Phones calls from community members interested in investing locally Idea … Default rates on microloans is low, due to high level of MDO support

8 P2P lending. P2P lending connects lenders with borrowers without the need for banks, credit unions, or other financial vehicles.

9 Existing P2P landscape.

10 Problems with existing platforms. Not local enough If local, not scalable Fund enterprises overseas Risk based on traditional assessment methods No support network

11 What about us? N2N Capital is a P2P lending platform connecting individual community lenders with local small businesses in need of capital. Draw upon MDOs for support Access limited by location: city/county/region Risk assessment based on community impact Community-focused, allows people to invest where they live Relationship-driven, emphasis on building interpersonal relationships High degree of business development support How we’re different.

12 How it works. Meet Nancy Brown.

13 Our model. Relationship with MDOs Local individual investors Electronic platform Geographically restricted Membership-based Two types of loans $500-$2,500 short term (1 year) $2,500-$35,000 (3 years) Loans above $5,000 can have multiple investors Each investor must enter with $1,000 Think Prosper/LinkedIn mashup with a touch of Groupon.

14 What you see.

15 Source of capital. Rise of Angel Investors Growth of sharing economy Interest in community investment

16 Risk mitigation. MDO support Personal relationship between lender and borrower Traditional assessments + performance + community assessment Membership required Numerous loan offerings

17 Source of return. Financial Strengthen the social fabric community Employment, wealth creation, education Increase resiliency of community Decrease vulnerability to exogenous shock Multiplier effect Strength of local businesses

18 (We stole this from )

19 The big picture. Community Resilience Financial Literacy $ Multiplier Effects $ Social Fabric

20 N2N by the numbers.

21 Why Lane County? Size - Large enough to support businesses, - Small enough to create strong sense of community. Demand - # of small businesses Lack of alternatives - Access to loans Interested Investors

22 Scalable. 74 Cities in US with population 200,000 to 500,000 Platform model easy to replicate MDOs exist everywhere Need for capital ubiquitous Can be limited to a city or expanded to a region (as population dictates)

23 The big question. Regulatory implications.

24 Lastly. Macro trends toward localization and sharing economies Solves problems with existing P2P Platforms Link borrowers + support + capital

25 The big picture. Community Resilience Financial Literacy $ Multiplier Effects $ Social Fabric

26 Sources/Inspiration. Carsten Henningsen, Portfolio 21 & Upstream 21 Shawn Winkler-Rios, eDev Valerie Plummer, Oregon Microenterprise Network John Sechrest, Northwest Innovation Resource Center Beth Hjelm, UO SAC Professor Bruce Hecht, Oregon Natural Step Michael Shuman, author of Small-Mart Revolution Michele Henney, UO Accounting Professor Ron Williams, Attorney Drew Tulchin, Social Enterprise Associates

27 The Big Picture. Community resilience Financial Literacy $ Multiplier Effects $ Social Fabric

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