Reno Rebuild leverages nickels to boost small business
A nickel goes a long way when multiplied many times over.
That’s the funding concept behind the Reno Rebuild Project, which provides small, low-interest loans to help local business owners over financial hurdles.
Reno residents and friends since early school days, Zach Gage, Mike Connelly and Chris Kahl, the founders of Reno Rebuild, are also the owners of several successful food and beverage businesses: Legends Grill, Sports & Spirits; Sierra Tap House, Ole Bridge Pub, and the Brewer’s Cabinet.
They are also proud of their hometown.
“We’re local guys. We’ve always been friends,” Gage said. “We’re committed to the ‘Keep it Local’ movement.
“We saw what stakeholders have done to develop blighted areas of Reno.”
And they watched as the recent economic downturn began to unravel those efforts and also blocked their own attempts to get a business loan even with a successful business track record.
“We had problems getting funding,” Gage said.
“Reno is very supportive of the food and beverage business, but that’s not true of national banks,” he said.
With help from family and friends, the business partners kept their businesses moving forward through hard times. Now they want to be friends and mentors for others starting out.
“Mike (Connelly) came up with the idea,” Gage said. “The community spends money at our places, it makes sense to get the community involved.”
For every item sold at their establishments, 5 cents goes into the Reno Rebuild fund.
“It’s a manageable margin,” Gage said, and “keeps the math simple. The (computer system) reports number of units sold. We just times that by five and transfer that amount to the fund.”
The locals-helping-locals concept has inspired other businesses and individuals to get involved, multiplying the fund even faster.
Reno Rebuild awarded its first loan of $20,000 in early 2014 to help Café DeLuxe open.
“The first year, 20 grand exceeded our expectations,” Gage said of the loan amount.
“The café is still in business and on track for payments.”
The second loan was awarded in April to Kellan Adams, of Bella Bucha Kombucha, a health beverage with an ancient Chinese history.
Adams began making kombucha for herself and friends and experimented with different flavors. She began Bella Bucha Kombucha as a wholesale business in 2012. The Reno Rebuild loan will help with a retail expansion of the business.
“It’s an amazing amount of money, but it only goes so far,” she said about taking time to prioritize before spending.
“When I started the business, I started on my own money and a small personal loan from a friend.” Adams said. “It was good because it gave me two years being in business, and I learned to be creative and as efficient as possible.”
With expansion, Adams is looking at extra expenses for testing and label redesign to be able to sell at Whole Foods. One immediate benefit of having the Reno Rebuild fund is the ability to buy supplies in bulk.
But at the top of her list, is applying the loan toward the purchase of a refrigerated delivery truck to sell her kombucha at farmers markets and festivals. She is looking at ways to leverage the fund to go farther.
“Because we’re looking to deliver, we’re also open to maybe a sponsored vehicle,” she said. A truck “would be really good to help with branding and efficiency of making it to events and for regular deliveries.”
Adams is also taking advantage of Reno Rebuild’s mentoring services.
Members don’t just drop off a check and then drop out of site. They also seek to help owners grow their business through mentoring.
“He’s quite the entrepreneur,” Adams said of Reno Rebuild’s Michael Connelly, who is her mentor. “I’ve been able to lay out a lot of questions about distribution, screen printing, labels. He’s introduced me to a lot of great people. He’s introduced me to a whole new group of entrepreneurs and start-ups as well.
“It’s inspirational to see so much in this community to help guide, as well. … Being an entrepreneur can be so challenging, in ways, and rewarding to see a business grow.”
Reno Rebuild is on track to award its third loan early next year and expects to take applications beginning in the fall.
“If we think we can, we’ll award two loans next year,” Gage said.
Solid applicants are needed.
“We need to spread the word. The application process is simple and straightforward.”
The Reno Rebuild board looks for applicants with a sense of community. They must be local and with a business plan that includes the intent to grow and hire additional people. They must have a store front and not only be sustainable, but be able to contribute to back to the fund.
“It’s a perfect feed-back loop,” Gage said.
Adams’ Bella Bucha Kombucha demonstrates the type of business the founders of Reno Rebuild seek to help.
Adams sees her business as a stewardship, not just in terms of being faithful to the healthful tradition of making kombucha. She also uses local sources of supplies as much as possible, she said, has hired another person and hopes to encourage others to “take the leap” to become an entrepreneur.
“I really want to help people starting a business, but starting a business on purpose.”
Reno Rebuild’s “focus is on developing the local economy,” Gage said. “Things that legitimately contribute to the tax base, employment, things like that.
“We want to find a way to build funds (for small businesses) with less than banks require.”
The Reno Rebuild loans are small compared to most business loans, but they can help get the financial ball rolling.
“Awards beget awards,” Gage said. “A lot of programs with awards and grants rely on the vetting process of others. If a business owner says ‘I won this award,’ it increases the chance of getting others.”
The Reno Rebuild members include lawyers, accountants, politicians and media, all focused on helping owners of small businesses. The organization also works with other business-oriented nonprofits, including the Community Foundation of Northern Nevada, which manages 130 nonprofits.
“When the call goes out, people raise their hands and say they’d like to mentor, to sit on the board,” Gage said.
Such focus on giving back to the business community gives the Reno Rebuild founders pride in their hometown.
“I think we’re becoming a startup hub,” Gage said.
“We believe Reno is outpacing like communities. When Reno is compared to places like Portland and Denver, it’s similar in the arts, economic development. When it comes to the desire to keep it local, to support local business, Reno is near the top.
“It’s exciting to be a part of it.”
Reno-based design firm MBA Architecture and Design is assisting on the $47 million Caesars Entertainment project in downtown Reno.