Micro-lender closes (temporarily?) its northern Nevada office
Nevada Microenterprise Initiative, a struggling statewide microloan lender, has merged with Valley Economic Development Authority, a $36 million lender based in Van Nuys, Calif.
NMI’s Reno office was closed last month to cut costs, but may reopen before the end of the year, according to Roberto Barragan, VEDC president and chief executive officer.
“Unfortunately, because the NMI loan portfolio was upside down we had to give the loan back to the Small Business Administration and close the Reno office for the time being,” says Barragan.
In the meantime, VEDC is looking for a consultant to work with northern Nevada businesses to apply for VEDC loans with the goal of reopening a lending office in Reno when it becomes financially feasible.
In its heyday, the nonprofit Nevada Microenterprise Initiative made loans for $35,000 or less typically, about $5,000 to the tiniest of business startups. It also provided counseling and training to neophyte business owners.
“We see the importance of having a presence in northern Nevada,” says Barragan.
Barragan was also meeting with the SBA in Las Vegas last week to again act as a Community Advantage Lender in Nevada as part of the SBA’s program for non-banks or community development financial institutions.
VEDC will launch a $2 million small loan fund for Nevada businesses at a Las Vegas event sometime in March.
VEDC loans about $25 million annually and provides other services to more than 4,000 businesses. The 36-year-old lender works primarily in the Los Angeles area but has branched out to other parts of the country, including Chicago, prior to venturing into Nevada.
NMI’s office in Henderson remains open and Lu Torres, previously president and chief executive officer, is now director of the group’s Nevada Women’s Business Center there.
She says she is working now with area colleges to provide online training for businesses.
Torres also said that northern Nevada business owners can contact Leanna Jenkins, NMI’s loan officer in Henderson, to apply for loans.
“She’ll be glad to work with them,” says Torres. “We are more than happy to make that happen.”
NMI, which stopped lending in 2011 while it reorganized, had been searching for a white knight for the past year.
When it stopped making new loans, Nevada Microenterprise Initiative held a portfolio of about 130 loans.
“The organization has been weak for many years. So we were looking for a larger company with many more assets for a partnership or merger,” Torres says. “After a lot of 11th-hour negotiations, it all came to fruition and now we are managed by Valley Economic Development Authority and the state has a strong microlender.”
VEDC makes a variety of loans to small businesses, from $1,000 microloans to $5 million in SBA loans. It also provides training and consulting.
“The thing that I like most about entrepreneurship is I can work toward something that I’m passionate about and be at the forefront of the change that I want to see happen,” said Priyanka Senthil, a senior at Davidson Academy in Reno and co-founder of startup company AUesome.