by Casey Dilloway, co-founder of Community Sourced Capital
Whenever I have friends in town, I tell them that Seattle is a city of neighborhoods--at least that’s what someone told me when I moved here 15 years ago. Beacon Hill. Capitol Hill. First Hill. Chinatown. Arguing over the boundary between Green Lake and Phinney Ridge is a classic conversation for seasoned Seattleites.
For many small businesses, the Shop Local movement exemplifies our city’s commitment to place, whether it involves eating, shopping, or manufacturing. Inspirational businesses like Urban Bee Company even tag the source of their honey with the specific backyard in West Seattle where it was harvested.
|This Pioneer Square lunch spot borrowed $6,700 from 65|
people to finance refrigeration upgrades. Over 90%
of the lenders live within the greater Seattle area.
What if our dedication to all things local extended to the capital systems that finance our favorite neighborhood businesses? I stumbled upon “local finance” a few years ago after reading the book Locavesting with my classmates at the Bainbridge Graduate Institute (now Pinchot). We wondered, “What if money was local, too?”
Localizing money would strengthen local business, create more jobs for our neighbors and grow our local tax base… just to name a few benefits.
My classmates and I decided to test the potential of local finance by creating Community Sourced Capital, a social purpose corporation that helps people lend small amounts of money to businesses they know. In doing so, we also built a way for businesses to access loans that are usually too small for a bank to provide. We’ve helped 20 businesses borrow $300,000 from over 2,000 lenders, and a third of that $300,000 has already been paid back. What’s the coolest part? The vast majority of our lenders live within a few miles of the businesses they fund.
But local finance is about more than the physical proximity of a company’s capital. It’s also about strengthening relationships between citizens and businesses in order to create shared wealth for our neighbors and neighborhoods.
Together, we can create a place where small businesses thrive, where economic opportunity is abundant, and where the neighborhoods we love are shaped--and financed--by the people who know them best.
Casey Dilloway is a GSBA member and a co-founder of Community Sourced Capital. He lives on Capitol Hill with his partner Shane. Read more about CSC at communitysourcedcapital.com.