Above: First row standing left to right: Eli Ochoa, Alfredo Caprirolo, CEO. Emilio Santandreu, Melina Santandreu, Joaquin Moreno, Fabio Beltran, Marcial Robiou, Alfonso Benavides
Second row sitting left to right: Eliese Gonzalez, Frida Garcia, Ileana Pelegrino, Joanne Cubillan
This blog is a part of my volunteer efforts to build a strong entrepreneurial community in South Florida and worldwide.
I recently spoke to Emilio Santandreu, the president and CEO of OUR MicroLending.
OUR MicroLending is a Florida LLC for-profit company. It does what its name says, it lends money to micro-entrepreneurs. Headquartered on Coral Way, by Coral Gables, they are my neighbors.
Since 2007, they've made 840 loans in South Florida, giving over $ 4 Million in funding (on an average $5,500 per loan), helping at least 936 people and supporting and creating at least 900 jobs.
The company is committed to assist South Florida entrepreneurs through micro-loans.
The money to lend comes from their shareholders and a small group of socially responsible investors. Their focus is on small business loans and not on consumer loans.
Emilio Santandreu, the president and CEO, is no stranger to micro-finance. He was the founding member and the CEO of BDM (Banco de Desarrollo del Microempresario), the first microfinance bank in Venezuela.
OUR MicroLending serves low and moderate income entrepreneurs that have no access to commercial business loans for various reasons.
These micro-loans enable their customers to work their way up through the economic ladder and become eventually bankable.
His company, Emilio said, prides itself on making their loan process as comfortable, as possible. They send loan officers to meet potential borrowers at their places of business, where they also weigh intangibles like references from customers.
About 80 percent of their clients, Emilio said, find them through referrals from former and current customers. Although, it is common for their loan officers to go out and do door-to-door sales.
The loan officers make their own evaluation about the micro-entrepreneur's drive to succeed. This character-based lending allows them to go “beyond the numbers” than a traditional credit score would allow.
As for the rates and terms, Emilio said, they provide small, short-term loans at interest rates that reflect the cost and risk of lending. As any business they need to stay profitable.
So, just like traditional banks, OUR MicroLending evaluates potential borrowers by taking into consideration business assets – which could be as small as a tin stall in the market – cost of goods sold and household expenses.
But unlike traditional banks, they do not make loans based upon revenue or collateral alone.
What makes their process different from traditional bank loans is their approvals are not based on credit scores, but on criteria, such as the individual’s experience in the field, business plan and other important clues that demonstrate that the loan will be repaid.
His company, Emilo told me, offers an uncommonly fast response time. The initial credit analysis takes approximately 48 hours, after which funds can be disbursed as quickly as 72 hours later. They also tailor the terms of the loans, amounts and payment schedules based on a study of the client’s business, so they get a loan that not only fits their needs, but which they can afford.
Borrowers either apply for loans individually, or, if they lack physical collateral or a co-signer, they team up with a few other borrowers. Known as solidarity group lending, this method allows members to cross-guarantee one another’s loans in lieu of collateral.
Emilio said that typical OUR MicroLending clients are truck drivers, restaurants, flea market stores, nurseries, or produce distributors, as well as consultants of all kinds.
Since my own development focus is on technology and online entrepreneurship, I asked Emilio about that sector specifically. He said, although they don't lend to startups (unproven businesses), they do provide funds to professionals that have extensive experience in their fields of expertise. And online and technology businesses can apply and will be evaluated based on their standard criteria, just like any other business.
That is good news for those in Miami who have a profitable online or consulting business and are looking for capital to grow. Check with OUR MicroLending and see if they can help.
Emilio said that they have a number of clients who are retirees who wish to continue working from home, also many attorneys, accountants, and other freelance professionals.
Then Emilio and I looked at OUR MicroLending as a business, their own profitability and their plans for the future.
He said, having started in 2007, they are looking to break even this year and begin making a profit in 2011. The progress has been moderate, he said, but they consider it as a reasonable trade for the assurance that they are being socially responsible and truly improving the lives of their borrowers.
OUR MicroLending, he said, makes a profit the same way that the banks do, through interest paid on loans. The difference is in their approach, taking the time to know the people and their business to maximize everyone’s potential for success.
Emilio told me that they are not aware of any direct competition in Miami, but noted that ACCION and Partners for Self-Employment are two local non-profit organization that also work with micro-entrepreneurs.
OUR MicroLending employs nine loan specialists, eight administrative team members, and has a board of fourteen chair holders.
The company is always in search of committed specialists and investors that believe in community growth through socially responsible practices.
They currently have offices on Coral Way and Hialeah, and will be opening two additional offices in Palmetto Bay and Oakland Park soon.
They plan new offices in Tampa and Orlando by 2011, full coverage of Florida by 2012, and then further expansions to the northeast of the country, Emilio said.
For more information, please visit www.ourmicrolending.com. Whether you are an investor, entrepreneur, or a community leader, I think OUR MicroLending deserves a closer look.
About me: I am Irina Patterson, was a Medical Doctor and tech PR executive in the past, My current passion is entrepreneurship. I'm a volunteer for the Silicon Valley-based Global Initiative 1M1M that offers free online guidance to entrepreneurs worldwide.