Kim Novak knew what she needed for her North Beach dog therapy business to thrive. She just didn’t have the money, and banks had denied her loan applications.
A $50,000-loan for an underwater treadmill designed for dogs was a tough sell without the appropriate financial forms in order, such as a profit and loss statement. That’s when a banker recommended the LiftFund to Novak, and her company’s trajectory changed.
“I just didn’t have what they wanted,” Novak said of the bank’s requirements. “I had good everything, but they wanted better than that.”
LiftFund — a not for profit entity that’s operated in Corpus Christi since 2004 and partnered with the city since 2007 — doesn’t face the same regulations, so help there was attainable, Novak said.
The program works by the fund loaning the principal amount of money and the city pays a portion of the interest to ease the cost to the small business owner. Since 2007, the partnership has produced more than 350 loans worth nearly $6.1 million, according to the group’s news release.
“Their perspective was, ‘How do we make this work, because we know you’re making money even if you don’t have the forms to show it,'” she recalled.
Now, three years later, Novak’s K9CARS is thriving and she joined a bevy of city leaders and fund officials at City Hall on Wednesday to encourage others to apply for the low-interest loans designed to get entrepreneurs started.
Mayor Nelda Martinez praised several residents Wednesday who now own businesses that got their start under the program. She said it’s a way to quickly spur growth through people who have the right ideas, but lack the ability to fund those visions.
About 96 percent of the loans issued by the agency, which spans 13 states, are repaid, and 100 percent of the recipients are not able to get loans through traditional banks, said Janie Barrera, the president and CEO.
“This is not a handout,” she said. “This is a hand up to help somebody.”
She likened the program to the adage of feeding a man for a day by giving him a fish when one could teach him to fish.
“We help people by the pond where they’ll fish,” Barrera said. “And that’s how we’ll help end the cycle of poverty.”
But the program’s future is uncertain. The city’s contributions are funded by the Type A dedicated sales tax revenue, and the funds are set to expire in September. City officials are grappling with how those funds should be used, but the final decision will likely rest with the voters in November.
During the City Council’s annual retreat Tuesday, some suggested spending the majority of that money on road projects with about 45 percent going to business development. Currently, the majority of the about $7.3 million collected annually goes to business incentives and small business programs.
APPLYING FOR A LOAN
Loans from LiftFund range from $5,000 to $75,000. Interested applicants should contact the agency by August to ensure applications are completed and reviewed before funds become unavailable in September. To learn more, call 361-834-8428 or visit www.liftfund.com