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Q&A with Wendy Baumann – WWBIC

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Q&A with Wendy Baumann – WWBIC

 

Q. What is WWBIC?

WWBIC

A. WWBIC is a leading innovative statewide economic development corporation “Putting Dreams to Work.” We focus on individuals who face barriers of traditional means by opening opportunities for pursuit of their dreams and economic well-being. We provide individuals interested in starting, strengthening or expanding businesses with access to vital resources and tools, such as quality financial partners and business education. We improve the economic well-being of targeted low-income individuals by building assets and advancing economic self-sufficiency. We particularly focus on women, people of color, and low-income individuals, providing direct lending and access to fair and responsible capital, quality business education, one-on-one technical business assistance and education to increase financial capability.

Q. How did the organization come to be?

A. WWBIC began in 1987 as a nonprofit organization serving women entrepreneurs. By 1992, our target market expanded to include low-income and minority entrepreneurs. Many emerging entrepreneurs came to us with identical needs, so in 1994 we launched our business education programming. We opened our social business venture, Coffee With a Conscience, in 1996. In 1998, WWBIC became Wisconsin’s first nonprofit certified and funded Community Development Financial Institution (a program of the U.S. Department of the Treasury) and in 1999, we launched our financial capability initiative because so many of our business clients needed to improve their personal financial situation and credit rating.

In 2014, we have grown to 50 staff members in four offices and three rural Wisconsin satellite offices.  A 10-member Board of Directors oversees the agency as a whole, and advisory councils serve our West Allis, Southeast, South Central, and Rural Wisconsin markets. Our 2014 operating budget is $5 million and our loan portfolio is just over $7 million. WWBIC has been recognized as a reliable engine for job creation and retention by every State government administration since our inception in 1987, and is the recipient of many local, state, regional and national recognitions. Our staff has consulted nationally and internationally.

Q. What types of companies does the organization fund?

A. WWBIC’s services are open to all, but we focus on women, people of color, and low-income individuals. We fund both startup and existing businesses throughout the State of Wisconsin, including urban, suburban and rural areas. We have a diverse portfolio, funding businesses in many different industries. A list of WWBIC’s clients can be found on our website, www.wwbic.com.

Q. What types of funding is available to companies?

A. WWBIC offers loans from $1,000 to $100,000 for expenses associated with starting or expanding a business, including machinery, equipment, furniture and fixtures, inventory, supplies, and working capital.

Every borrower is supported by Development Services. WWBIC provides Development Services through one-on-one counseling, business education classes, financial education classes, one-on-one volunteer coaches and mentors, and opportunities such as the annual WWBIC Luncheon Client Trade Fair and a Business Resource Directory on WWBIC’s website.

Our business assistance/small business counseling model is strongly proactive and begins immediately upon loan closure. National studies show, and WWBIC’s experience has borne out, that the key to microenterprise sustainability is the intensive one-on-one assistance that WWBIC provides to each client for the life of the loan.  By providing services and support, community organizations have a significant impact on job creation and business survival. Businesses that received capital and services from a non-profit had median annual revenue growth 26% higher than the businesses that did not, according to a recent survey by the Association for Enterprise Opportunity. Small business counseling includes review of financial statements and an annual site visit, beginnings immediately upon closure of the loan.

Flexibility in WWBIC’s underwriting standards enables increased responsiveness to borrower needs, with lower collateralization requirements, lower credit scores, and lower equity contribution requirements. WWBIC also provides flexible down-payment policies, and negotiable extended/flexible terms, such as interest-only payments, or limited payments for a finite period. For example, a seasonal business may pay interest-only for part of the year with larger principle payments during heavy-volume months. Terms are generally longer than industry standards, which are generally based on defined factors such as useful life of collateral, to allow these businesses to get up and running without additional strain on their cash flow from large loan payments.

Q. How often does the organization fund companies?

A. We see continued increasing demand for WWBIC’s services. In 2013, WWBIC closed 124 loans with a total volume of $4.8 million – an increase of 83% over 2012’s $2.6 million. Through May 31, 2014, we have closed 57 loans totaling $2.7 million. WWBIC’s loan portfolio has grown substantially since the recession. As Wisconsin’s job growth progresses, many former employees turn to entrepreneurship as a means of self-employment. Many of our loan clients return for a second or third loan.

Q. Are there other requirements to be eligible to apply for funding?

A. To be eligible for a WWBIC loan, the applicant must own a start-up or existing for-profit business within the State of Wisconsin. A loan application may be completed on WWBIC’s website, including the submission of a full business plan. After a completed application is received, a WWBIC loan officer will contact the applicant within two business days.

Q. How does someone contact WWBIC?

A. WWBIC has offices in Milwaukee, Racine, Kenosha and Madison. Please visit our website for more information: www.wwbic.com.