Joining With Partners, We Extend Opportunity
In July 2012, more than 100 people turned out for the formal launch of a microcredit program to help capitalize small businesses in Cuyahoga County. It was a moment to savor for the public-private partnership that pooled $4 million to fund microloans and another $600,000 to support training and technical assistance for local entrepreneurs. To operate this program, the partners selected the Columbus-based Economic and Community Development Institute, a widely respected microlender with an eight-year track record of targeting underserved populations. The Cleveland Foundation made an $85,000 planning grant to ECDI in 2011, followed by startup support of $400,000. Even before the July launch, ECDI made eight local loans totaling $163,000. The day after the event, ECDI received almost 100 phone calls, a dozen e-mails, and drop-in visits from a handful of potential loan applicants.
Our vision: a deeper microlending pool
Responding to the needs of "economically isolated" entrepreneurs, the Cleveland Foundation assembled a lending working group in early 2011. A subsequent study of the microcredit landscape in Cuyahoga County, which we commissioned with the Business of Good Foundation, estimated an unmet need of $38 million in loans under $50,000.
This gap affects primarily low-wealth people, including minorities, immigrants, and women. Their businesses may be too small to interest conventional lenders, or they may be deemed not creditworthy.
To begin addressing this issue, the working group invited Bad Girl Ventures to Cleveland. This Cincinnati-based nonprofit provides education and low-interest microloans to women who aspire to compete in the hard-hitting arena of business startups. We
supported BGV's 2011 entry in this market with a $25,000 grant. Impressed by the momentum this nimble program has generated, and viewing it as a feeder to the Economic and Community Development Institute, we granted an additional $50,000 in 2012.
The microlending initiative is in its infancy, but we have made a strong start. The partnership we convened to tackle microfinance and bring ECDI to Cleveland is a model of collaboration, engaging the city of Cleveland, Cuyahoga County, the U.S. Small Business Administration, Huntington Bank, the Greater Cleveland Partnership, the Commission on Economic Inclusion, and the Business of Good Foundation. While helping to fulfill the dreams of would-be and actual entrepreneurs, a robust countywide microcredit program can bring all of us one step closer to a vibrant core city in a region on the rise.
Our grantees create jobs locally and regionally
The $5.6 million we invested in economic development in 2011 supports a mix of enterprises. Much of this total funded the hands-on work of grantees such as NorTech, Team NEO, and JumpStart, which also received a collective $2.2 million in early 2012 to continue their efforts in regional business attraction and development.
We partner with these world-class organizations because they
advance five interconnected priorities: innovation and entrepreneurship; business growth; promotion of industry clusters, including advanced energy and flexible electronics; globalization; and a healthy core city. For us, the most urgent priority within our economic development strategy, where we have staked out a leadership role, is to catalyze a renaissance within our urban core.
Together, we're building a biomedical cluster
A driver of renewal in the urban core is BioEnterprise Corp., which received $350,000 in 2011 and $150,000 early in 2012 from us to continue developing a biomedical cluster in the Cleveland Health-Tech Corridor. This three-mile swath of Euclid Avenue is an offshoot of our work in Greater University Circle. It is home to more than 80 biomedical companies, 30-plus technology companies, and seven business incubators.
BioEnterprise aims to make Northeast Ohio a national hotbed of health care innovation and commercialization. With some 200,000 square feet of space recently opened—and already 90 percent leased—plus another 400,000 square feet under development, the Health-Tech Corridor is prime real estate for companies seeking to grow or to supply the four health care and three higher education institutions anchored nearby.
