Traverse City Record-Eagle

July 21, 2013

Laura Galbraith: Business capital spurs economy

Special to the Record-Eagle

---- — TRAVERSE CITY — Old sayings become old sayings because they ring true over a long time.

The age-old business axiom “it takes money to make money” dates back 2,000 years to the Roman playwright Plautus. But those ancient words are just as relevant today.

Companies large and small often encounter times when an infusion of business capital is critical to their success. It might be at start-up, during expansion, to find a new market or buy a piece of needed equipment, grow inventory or endure an economic downturn. A business loan secured in a timely fashion at a reasonable interest rate can mean the difference between profit and loss, hiring employees or laying some off, or moving ahead with a new venture.

Finding business capital, however, is more challenging than ever. The recent economic downturn changed the playing field for businesses and lenders. Many companies, especially those without a long operational history or seeking smaller loans find they sometimes don’t fit within the new lending metrics. Lower property values, short credit histories or a lack of extensive collateral - scenarios faced by many new or small businesses – can be a deal-breaker for companies needing cash.

The Traverse City Area Chamber is helping businesses maneuver this credit crunch with a range of lending programs that fill a critical niche in our economic landscape. An Energy Efficiency Loan Fund established last year with support from Traverse City Light and Power Co. issued seven notes so far totaling more than $100,000. It’s helped those companies save more than $53,000 annually in energy costs, and reduce power consumption by 500,000 kilowatt hours. That’s enough electricity to power a half-million homes for a month.

Fifth Third Bank recently selected the Chamber to partner on a new Sub-Micro Loan Fund to provide smaller capital amounts under the radar of traditional lenders. This fund just helped a local family farm get its cherry products in front of folks at the National Cherry Festival. Another loan is helping purchase a needed piece of equipment for a farm in Benzie County.

The Chamber also invested $150,000 of its own funds to bolster both loan programs.

For larger Stage Two operations, the Chamber offers a Development Fund with up to $250,000 in financing coordinated with traditional lenders to help spread the risk for larger business projects. That fund just turned around a loan to help a Leelanau County agribusiness open a new restaurant in Suttons Bay.

In the works is a 10-county regional revolving loan fund with the Michigan Economic Development Corp., and an initiative with the U.S. Department of Agriculture to provide working capital to local companies ranging from start-ups to well-established operations. We also partner with regional and state agencies including Northern Initiatives and the Michigan Small Business Technology & Development Center (SBTDC) to leverage their resources in our communities.

These dollars are putting northern Michigan goods and services in the hands of consumers, preserving natural resources, creating jobs, growing local tax base and bolstering companies’ bottom lines. Check out “Need Money” at – we might be able to help your company as well.

Laura Galbraith is the Vice President of Administration for the Traverse City Area Chamber of Commerce. Contact her by email at