Ashley Loehr started Sparrowbush Farm in Columbia County nine years ago. She’d fallen for agriculture early on, working summer farm jobs from the age of 16. What she’s built on 98 acres of leased hayfield, pasture, cropland, and woodland is a respected mix of share-owned and farm-market supported product line of vegetables, herbs, flowers, laying hens, lambs and pigs.
A few years back Loehr, still in her 20s, saw a market for winter veggies and started a separate farmshare program for the greens she was growing in “high tunnels,” alongside storage vegetables, lamb, pork, and eggs. She wanted to expand, and maybe get a real greenhouse.
“We applied for and received a loan from the USDA that will cover $6,600 of the $8,000 high tunnel,” Loehr wrote when applying for Kiva Zip funding a few years back. “The loan from the USDA is a reimbursement loan, so we don’t receive the funds until we purchase and construct the high tunnel. This $5,000 loan through Kiva Zip will provide the necessary capital to purchase and construct the structure this summer.”
As with all Kiva Zip funding proposals, she reached out for an endorsement… and got one for Sparrowbush from the Hawthorne Valley Association, a Columbia County powerhouse that runs a farm, farm store and school. It took a week to find the loan finding she was seeking online, and then a year and a half to pay it all back when the USDA funds finally came in.
Others have done, or are doing, the same throughout the Hudson Valley with ag and food production ideas. Look across the greater area and one encounters a food product company in Peekskill seeking to expand its vegan offerings, artists in Woodstock looking to take their growing business from the virtual into a bricks and mortar reality, and even cleaning companies looking to match services to a growing second home community. It’s not gotten the numbers of Brooklyn and Manhattan activity yet, but then it’s only now getting known beyond in circles of young entrepreneurs.
Kiva Zip is a project of Kiva, founded in October 2005 by two young people who attended a lecture on microfinancing at Stanford Business School and realized there was a world-wide lack of start-up funds available. Taking the Swahili word for “unity” as their effort’s name, Matt Flannery and Jessica Jackley found idealistic yet reality-bound smaller projects and similar small-scale but risk-ready lenders. Quite quickly, they interested key figures at PayPal and LinkeIn to help their budding effort and within a year they were financing $1 million in loans a year. As of this past March, Kiva had distributed $827,356,850 in loans from 1,394,336 lenders to 1,928,760 borrowers at an average loan size is $411.26, and the average lender financing 10.17 loans with a repayment rate of 98.37%. Over 80 percent of all loans were being made to women-owned start-ups.
Kiva Zip is a streamlined form of Kiva’s international model, which has aided students and worked through localized “field partners” who have used the format to help finance their own lending and anti-poverty efforts. Geared to the U.S. start-up world, its loans tend to be $5,000 and above, with a more rigorous vetting process that involves the finding of institutional or Kiva Zip trustees’ endorsements, as well as their own lenders in threshold numbers dependent on the size of their loan. Quick time spaces, under 15 days for bringing in lenders, and 45 days for borrowing, guide the process… along with strong business plans, a sense of social betterment, and character studies.
As Kiva Zio advises would-be borrowers on its website, ” Rather than assessing your credit history and financial statements, Kiva Zip uses your character and trust network as a measure of creditworthiness. First, you will be asked to join our community by making a loan to another small business owner. Then, you will be asked to invite a number of lenders to launch your fundraising. Once you have the support of your friends and family, your loan will begin publicly fundraising from our network of over a million lenders – without ever sending us a credit report or bank statement.”
Those lending money through Kiva Zip see no interest for use of theior financing other than a transparent reporting of their chosen borrowers’ reports and good will.
“Discover inspirational borrowers making a positive impact in their communities.Support an entrepreneur’s dreams. Make a loan to empower their business and livelihood. Receive repayments on your loan and receive updates on the impact you helped create. Use your repayments to support another borrower and increase your impact,” reads the simple directions for lenders, who as of this writing had a choice of 96 borrowers’ requests to choose from on the Kiva Zip website, a quarter of those in the New York State area.
Is Kiva a threat to other start-up funds, or more traditional agricultural financing avenues in the Hudson Valley now or in the foreseeable future? Not really, given that the amounts it is dealing with are less than the new venture capital groups starting to make an impact from Westchester up to Kingston, or reaching down from the Albany area. Farm Credit East, a century in business, works with established farms; Hudson Valley AgriBusiness Development Corporation, out of Hudson, advises those who come to them to approach existing state, federal and a few private granting and lending programs and institutions. Slow Money, out of Colorado, tends to work out of events and localized networks, without the direct yet somewhat impersonal contact between lenders and borrowers facilitated by Kiza and Kiva Zip’s elegant website protocol.
Meanwhile, Sparrowbush has completed yet another successful year of its winter farmshare program, which now works with a growing number of other farms, and even a bakery, in the vicinity.
“Our goal is to make a viable living, grow high quality products that are important to us, contribute to our local food economy, and build long term soil health,” was the farm’s original mission statement on its Kiva Zip request page.
Seems they made it… with a host of lending partners’ help.