Nonprofits offer new twists in microinvesting.
A small group of nonprofit organizations is testing financing programs to help low-income individuals start and sustain businesses. The 2-year pilots were made possible by grants from the Aspen Institute, a non-profit organization in Washington, DC. Two of the innovative programs create a micro-venture-capital fund and establish a Business Investment Trust, respectively:
- Coastal Enterprises Inc. (CEI), a Wiscasset, Maine, economic development agency, will make investments through its micro-equity product of up to $25,000 in sole proprietorships, partnerships or corporations that are operated by individuals from households with low incomes, create jobs for low-income residents or are in the natural-resources and organic-farming industries. The investments are for five to six years, and the exit strategies vary by company.
CEI also offers grants of up to $700 (available in two stages) to low-income entrepreneurs. Business owners must submit a business plan, then follow up three months later with a report on how the grant proceeds were used. The grants are made possible largely through a partnership with the Trickle Up Program, based in New York City. For details on the programs, call (207) 882-7552. Both CEI programs are intended for residents of Maine only.
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