Online Platform Connects Entrepreneurs with Local Lenders SoMoLend has facilitated over 100 small-business loans totaling nearly $3.5 million.
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Candace Klein knows firsthand how hard it is to raise startup funds. When she needed capital for her first business, Bad Girl Ventures, a microfinance organization for Cincinnati women-owned businesses, she tapped several relatives--a move that led to a few "very uncomfortable Thanksgivings."
That experience inspired SoMoLend, her online platform that plays matchmaker between businesses and investors, often in the same geographic neighborhood. Since the beta site launched in May 2012, SoMoLend has facilitated some 100 small-business loans totaling nearly $3.5 million. Loans range from $500 to $1 million, with interest rates ranging from 3 to 22 percent and terms spanning six weeks to five years, depending on a business's needs and creditworthiness. SoMoLend also charges a 4 percent transaction fee on funds borrowed.
Lenders using the site include banks, credit unions, community-development financial institutions, cities, churches, foundations, chambers of commerce and individual investors. Once securities-based crowdfunding becomes legal this year, the site will facilitate those types of investments as well.