One of the biggest barriers to starting or expanding a small or local business in this country is a symptom of the “Great Recession” — access to capital has significantly contracted in the past five years and small business owners have been hit the hardest. That’s where you come in. What if there was a mechanism where members of a community could help finance the businesses and organizations they want to see flourish in their city? What if a little bit of the power belonged to the people and not just the banks in choosing how the local business sector shapes up? In this edition of the Green Line Series, Casey Dilloway, co-founder and president of Community Sourced Capital, explains how the evolving democratization of finance offers a viable supplement to traditional sources of capital in a way that gives citizens direct access to funding the change we wish to see.
GoGreen Conference: What is the problem or challenge you are trying to solve via a crowdfunding mechanism and how do you specifically approach it at Community Sourced Capital?
Casey Dilloway: The problem within the financing world is that our system in general is not acting in the interest of every person. It’s acting in the interest of fewer than most. This is especially true at the local level, where people are starting to see how simply shifting habits has a huge impact on their local economy and it’s part of the greater sustainability movement.
The problem from the financial side of things is that we usually rely on banks to help support small businesses with financing and in the past few years bank loans to small businesses have been decreasing. Specifically very small loans — like those under $150,000. That’s the problem we are trying to solve — making small businesses stronger and giving them access to capital in the mean time.
When we started crafting our solution we looked at developing as much of a systems-based approach as we could. If we are going to get small businesses access to capital then we might as well get it from the very people supporting these small businesses as consumers. Our system sources capital from the people that also benefit from the business. And we are seeing really strong connections between our individual lenders and the businesses they are lending to in a way that I don’t think we’ve seen in a really long time in society.
Ultimately we’re trying to line up our money with our values. And we think that if people knew more about what their money was doing when they’re not spending or consciously investing it, they would be upset. That they would want to have more say over what their money is doing.