Brewing Up Micro Loans

A small business loan by Boston Brewing Company offers inspiration for credit unions.

 
 

With revenues nearing $800 million in fiscal year 2013, Boston Brewing Company — the producer of Samuel Adams beer — is one of the largest American-owned breweries. Whether the company should still be classified as a craft brewer is up for debate; however, it has remained committed to pillars of the craft beer movement such as using local ingredients and deliberate processes.

But Boston Brewing’s commitment to acting locally does not end with its ingredients. Since 2008, the company has partnered with national microfinance network Accion to provide its Brewing the American Dream loan that offers small business owners in the food and beverage, hospitality, or craft brewing industries microloans ranging from $500-$25,000. To date, Boston Brewing has granted monetary assistance to nearly 200 small businesses across the country, although the bulk of businesses are concentrated in New England, Massachusetts in particular.

Rather than simply evaluating the viability of a small business and providing funding assistance, Boston Brewing leverages its knowledge of the food and service market to help small businesses break into the market by providing coaching and mentoring on operation-related topics ranging from financial to managerial. The loan program offers money as well as the tools and expertise to help businesses provide a good return on investment. Sure, $5,000 is welcomed assistance, but so is an understanding of how and where to spend it.

Credit unions have the same kind of business know-how and community knowledge to offer this kind of assistance. After all craft beer and credit unions are more similar than they might first appear. Boston Brewing's micro lending program is just another example where the credit union industry can learn from those who brew beer for a living.

Helping small businesses with financial backing and operational know-how serves the mission of Boston Brewery. The company lends to what it understands and is willing to help others succeed in its market. It’s not approving five-figure loans to hair salons or tattoo parlors; it is lending to craft breweries and restaurants — business that could, oddly enough, be future competitors. Yet despite that possibility, Boston Brewery believes it has a duty to encourage these ventures through loans and education.

Credit unions have a similar world view. As community-focused financial institutions, they exist to assist local economies and local businesses. The Brewing the American Dream loan program is a slow money approach, a long-term strategy for community development. With this program as inspiration, credit unions can sow the seeds for growth in their own communities.