When Angie Horkey opens her new cafe in Westbrook next month, the steam tables and the exhaust fan over the dishwasher will be courtesy of the first foray into Minnesota by Kiva, a global microlending organization.
Horkey is renovating part of a bowling alley to turn it into a 100-seat cafe called the Recipe in the southwestern Minnesota prairie town of 739 residents.
Westbrook resident Angie Horkey and two of her children, Sophie and Talitha.
"I have always loved to cook and my husband told me, 'You need to find more people to eat this food,'" said Horkey, 43 and a near life-long resident of the town.
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The problem has been that even with lots of sweat equity, the project turned out to be more expensive than planned. The Southwest Initiative Foundation in Hutchinson, a big provider of microloans in that part of the state, is lending $45,000. But under a new pilot program to act as an "endorser" for Kiva, the foundation also set her up to solicit really tiny loans -- as little as $25 each -- from anybody who wants to help her out.
Kiva operates a little like Kickstarter -- people can go online to financially support a project they like. In Kiva's case, however, the organization's larger goal is specifically to help alleviate poverty and the money provided by the public is in the form of a loan that the project owner agrees to pay back in two years.
Horkey's cafe project solicited $2,500 via Kiva, and when the Westbrook VFW agreed to kick in $375 this week, she reached that goal. If she makes it through electrical and health inspections in the coming days, she expects to open in January.
Among her first customers will be senior citizens taking advantage of meals made available through the state senior meals program. Until now, Horkay has been bringing those meals to Westbrook's senior center from Tracy 22 miles away.
San Francisco-based Kiva has been around since 2005 and is approaching a million lenders and nearly $400 million in loans. Its loans so far get paid back 99 percent of the time, according to the organization's website.
The Westbrook project is the first in Minnesota resulting from a Kiva spinoff called Kiva Zip. The effort involves partnerships with organizations that find and endorse projects. Because the Southwest Initiative Foundation has been a big player for some years in microlending, it was a natural candidate to become a Kiva "endorser," said SWIF's encore entrepreneur specialist Greg Jodzio.
For the foundation, Kiva represents a way to find more money for its clients.
It's the latest wrinkle in a growing microlending, a phenomenon originally championed in other parts of the world and aimed particularly at getting small amounts of money into the hands of women entrepreneurs.
Minnesota's biggest microlender is probably the Entrepreneur Fund in Duluth. Mary Mathews, chief executive officer, said her organization is having a record year with about 70 loans, most for less than $50,000.
The most recent innovation for the Entrepreneur Fund is to make it easier to apply for microloans online, she said.