In celebration of Small Business Saturday (Nov. 25), we're profiling emerging enterprises in the communities where we work that have benefited from LISC small business lending and support. In Boston, Northeastern University and LISC have launched the Impact Lending initiative to spur women- and minority-owned businesses and local economies that surround the university. Honeycomb Café, a bustling new locavore restaurant in South Boston’s Dorchester area, offers a picture of impact lending at its finest.
On a recent Monday morning, the Honeycomb Café in Dorchester’s Savin Hill was buzzing. Customers—regular and newcomers--lined up for breakfast sandwiches made from local eggs and fresh bread, and espresso steamed from locally roasted beans. In just a few short months, the Honeycomb has become a neighborhood meeting spot and comfort food staple.
But first-time business owners Nicole and Lara Miele might not have opened Honeycomb were it not for an innovative small business loan program offered by Northeastern University and the Local Initiatives Support Corporation (LISC), a national nonprofit working to expand economic opportunity for low-to-moderate income people and places.
The goal of the Impact Lending program, launched late last year, is to nurture the local economies of neighborhoods that surround the university and position business owners to become Northeastern vendors, opening doors to significant new growth opportunities for them. In particular, Impact Lending is geared to supporting women- and minority-owned businesses in low- to moderate-income communities.
“This is super exciting,” Nicole Miele said. “We haven’t even marketed the catering part of our business yet, and we’re already starting to see interest.”
LISC’s support for Honeycomb is part of the organization’s broader economic development strategy in Boston, which since 1981 has meant $281 million in investments for housing, businesses, health, community safety and jobs, including more than $30 million to fuel opportunities in Dorchester.
Through its small business arm, LISC provided a $37,000 loan to help the Mieles pay for construction costs and purchase the commercial kitchen equipment they needed to launch. “We worked with Lara and Nicole at every step of the process,” noted Steve Hall, vice president for LISC Small Business, “from determining how much capital their business might require to shepherding them through the financial implications of the loan and how it might impact their business in the future.”
Honeycomb also received a $37,500 loan from Dorchester Bay Economic Development Corporation, a longtime LISC partner, bringing the total loan value to $75,000.
Hall noted that traditional lenders are often reluctant to make small loans like the one the Mieles needed, particularly when the borrowers are startups or located in disadvantaged communities. LISC takes a different approach, focusing on promising opportunities to spur growth. “With Honeycomb, we were able to look beyond the numbers to see two exceptionally responsible partners with a clear vision for execution,” Hall said.
Over the past two years, LISC Small Business has financed more than 60 small businesses in underserved markets across the country. Though, nationally, more than a third of all small businesses fail in their first two years, LISC has seen 97 percent of the businesses it has supported flourish—even though they would be considered high-risk investments by most lenders.
Eric Uva, director of LISC Small Business for Boston, noted that socially motivated businesses like Honeycomb Café tend to succeed because their owners are committed to something beyond profit margins. “Lara and Nicole are fantastic managers who found a way to marry their passion for food and their business sense with their social mission to hire and source locally,” he said.
They also live in the same community where they operate their business, and tapped their local relationships to gauge local demand. “Well before we opened, we reached out to our neighbors to see if this was the kind of business that they wanted in the community; they made it clear that it was,” said Nicole Miele. “We are offering something a little different, and people are responding.”
As they flourish, these kinds of enterprises attract additional investment capital to communities, often inspiring others to open their own shops, restaurants, offices and studios in the neighborhood. “Others think, maybe I can achieve this outcome,” Hall said. “If you see it, you can believe it.”
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