Live the Dream Development, Inc.

The People's Opportunity Program for Underserved Populations (POP-UP) targets minorities, women, and low-to-moderate-income individuals for small business ownership or enhancement. The program offers small business development training, counseling, and mentoring to potential, new, and existing small business owners in Warren County, Kentucky. These clients are coached to prepare financial statements, business plans, and formal presentations to request low-interest loans from the POP-UP Board. Additionally, POP-UP facilitates mentoring, workshops, and in some cases, low-rent facilities to funded clients to make possible their continued success. 

Funding for POP-UP microloans comes from several area financial institutions, grants, and community partners. Relationships with local financial institutions are encouraged for approved clients who qualify, and several financial institutions have adopted the terms of POP-UP microloans for those clients. 

Plans are in the works for an opportunity to provide more commercial space with affordable rent for businesses that align with the mission of POP-UP. Coupled with POP-UP loans, many businesses can grow in these spaces, under guidance of the program, until such time that they can sustain higher rent elsewhere, thus enabling economic mobility for them and making room for additional clients to benefit.

Both research and practice show that small business owners often find piecing together the capital for their businesses extremely difficult. However, researchers have found that the barriers to financing for minority and women business owners are greater than for others. There is mounting evidence that minority business owners, particularly Black and Hispanic business owners, face a tangible and substantial disadvantage in obtaining credit compared to others, even when controlling for factors like credit scores, personal wealth, and revenues[1]. Additionally, studies highlight that women and minority business owners are more likely to feel greater discouragement in applying for credit relative to nonminority and male applicants. Research shows that when minority business owners do obtain credit, they receive smaller loans and their cost of borrowing is often higher than for whites[2]. Research suggests that this undercapitalization for minority-owned businesses leads to less profitable enterprises, less likelihood of survival long-term, and lower job creation rates[3].

[1] Cole, R. (2014). Credit score and credit market outcomes: Evidence from the SSBR and KFS. Accessed from: www.sba.gov/advocacy/7540/7915...
[2] Bates, T., and Robb, A. (2013). Greater access to capital is needed to unleash the local economic development potential of minority-owned businesses. Economic Development Quarterly, 27(3), 250-259.
[3] Fairlie, R., and Robb, A. (2008). Race and Entrepreneurial Success: Black-, Asian-, and White-Owned Businesses in the United States. The MIT Press.

The Challenge, as stated, is “to identify innovative nonprofit-driven solutions that provide support to grow, develop, and sustain racially diverse and/or women-led small businesses in the United States” and POP-UP does just that. By connecting these small business owners with key stakeholders such as investors, mentors, and the regional university, POP-UP has a unique opportunity to improve the local small business ecosystem while providing women- and BIPOC-owned businesses a step-up and transforming their owners’ lives!
The problem of lack of funding for minority- and women-owned businesses, coupled with the POP-UP solution of preparing minority and women clients to ask for a microloan, and then providing the loan, if approved, assists women and minorities with financial education and information as well as access to capital.  

Although POP-UP targets women- and minority-businesspeople in Bowling Green/Warren County, Kentucky, a majority of clients come from the Housing Authority of Bowling Green which has 598 households with 1,389 residents.  Resident breakdown by ethnicity is a follows: 31% African American, 18% Caucasian, 24% African Immigrants (Burundi, Liberia, Ethiopia, Somalia and others), 3% Eastern European (Yugoslavia, Bosnia, Russian, etc.), 11% Asian (Burma, Vietnam, Philippines, etc.), 4% Middle Eastern (Iraq and Pakistan), 5% Hispanic, and 4% Multi-Racial. Sixty-seven percent of the households are led by single women.

Since its inception in August 2020, the POP-UP Small Business Consultant has met with over 90 minority or women business owners representing over 80 businesses (as of April 2022). Nineteen minority/women-owned businesses have been approved for microloans totaling $162,500. Of these nineteen, 15  owners have expanded their businesses and are operational, if not profitable. The lives of these 15 have been impacted as evidence of several of them leaving previous jobs to focus fulltime on their businesses. Their families are engaged in the businesses with them, and they are working toward sustaining their businesses with the goal of having something to pass on to their children. 

POP-UP is currently serving only businesses located in Bowling Green, Warren County, Kentucky. The program model has been shared with faculty at universities in other states (i.e., Nebraska and Indiana) but as of now, POP-UP is only in Kentucky. 

"The People’s Opportunity Program for Underserved Populations (POP-UP) is committed to expanding economic opportunities for minorities and other under-resourced members of our community by providing business know-how and financial resources for positively impacting new and existing business development" (POP-UP Mission, approved by POP-UP Board, September 24, 2020). This mission represents the overarching goal of our organization to help launch or expand small minority- and women-owned businesses. Although almost all of the businesses funded by POP-UP were in existence in some form prior to funding, the POP-UP Small Business Consultant has helped many clients acquire their LLC and EIN for their businesses.

The POP-UP solution of providing microloans to clients after coaching them, addresses the problem of lack of funding for minority- and women-owned businesses, and with additional support to funded clients, positively impacts business development for minority- and women- owned businesses.  This is the mission of POP-UP: expanding economic opportunities for minority and low-income businesses by providing business know-how and financial resources for positively impacting new and existing business development. 

Activities and outputs involve the lead consultant meeting over several weeks with clients to help them complete detailed market analysis and financial projections for their businesses. This “deep dive” provides insight to clients they may have never considered previously; for example, how much does it cost to make one cupcake? Then clients write business plans and prepare oral presentations for the POP-UP Board. Funded clients are provided additional support through promotion, mentorship, workshops, tax help, credit counseling, and possible inclusion in capstone student-led consulting projects by senior business majors at Western Kentucky University. 

Short-term outcomes involve the forming of legal entities (LLCs) and the renting of space by clients previously working out of their homes. Clients also begin relationships with banks by starting business accounts. Clients start bookkeeping, pay taxes, and gain insight from mentoring by local businesspeople. Through credit counseling, POP-UP clients understand what impacts and how to improve their credit rating, which they pass on to their children. Four of the 19 funded clients were "bankable" and received their loans from local financial institutions. The others were funded, by POP-UP, despite low credit scores. Fifteen of the clients persist today, and at least seven have hired employees. 

Long-term outcomes include established minority businesses representing what is possible for others, relationships with banks that may impact future loans (e.g., buying a house), and establishing the foundation for transformational support to women and BIPOC-owned businesses in Kentucky and beyond.  

The the primary goals are community sustainability and growth, empowerment of clients, creating a future of entrepreneurship for low-income and minority entrepreneurs, and developing community partnerships to ensure those, who have been historically discriminated against in lending, have access to capital.

Since its inception in August 2020, the POP-UP Small Business Consultant has met with over 90 minority or women business owners representing over 80 businesses (as of April 2022). Nineteen businesses have been approved for microloans totaling $162,500. Of these nineteen, 15 minority/women owners have expanded their businesses and are operational, if not profitable. These 15 "funded POP-UP clients" are being served by a small business consultant recently hired to assist funded clients launch or expand their businesses. In addition to the funded clients, the POP-UP Lead is currently working with ten clients who are preparing to go before the POP-UP Board over the next several months. (The POP-UP Board usually hears presentations from one or two new clients each month as well as updates from one previously funded client.) This brings to 25 the number of POP-UP clients that are currently being served. Over the course of 2022, it is expected that 55 new clients will meet with the POP-UP Lead and that the number of funded clients will increase by at least one per month, bringing the number POP-UP will have served in one year to about 80 minority- or women-owned business people. In five years, that number could be over 250. 

The community POP-UP serves includes women, minority, and low-to-moderate income small business owners in Warren County, Kentucky. Many clients come from the Housing Authority of Bowling Green. Resident breakdown by ethnicity is: 31% African American, 18% Caucasian, 24% African Immigrants, 11% Asian,  and 16% Eastern European, Middle Eastern, Hispanic, or Multi-Racial. Many of the customers of funded POP-UP clients are also Housing Authority residents as at least three of the new businesses are located within the Housing Authority area.

Stakeholders include the Housing Authority of Bowling Green, and the Bowling Green City Commission, which is voting soon on a proposal to locate an affordable-rent accelerator in the Shake Rag Historic District, recognized for its significance to African American history.  Several in POP-UP have ties to Western Kentucky University, which provides opportunities and resources for POP-UP clients. Also, local financial institutions are stakeholders for the role they play in POP-UP. 

POP-UP is very much tied to the local Housing Authority, where the POP-UP office is located, and the vice-chair of the POP-UP Board is the Director of the Housing Authority, Mr. Abraham Williams. Mr. Williams, a well-respected, African American is constantly encouraging his residents to seek assistance from POP-UP to start or enhance their small businesses. Mr. Williams was recently awarded an Honorary Doctorate by Western Kentucky University (WKU), further evidence of the respect he has and the work he has done in the Bowling Green community. The POP-UP Board also has two bank presidents serving on it. Leaders in the local banking industry, these two serve as liaisons to the other local financial institutions and guide funding decisions for the POP-UP Board. Finally, several members of the POP-UP Board and its staff have direct ties to WKU (the lead consultant is a WKU Faculty Emeritus in Business). Of those who are currently faculty at WKU, strides are being made by them to ensure more minority representation in WKU's Purchasing, and as opportunities for student-projects with small businesses are identified, connections are made with POP-UP clients.  

POP-UP falls under Live the Dream Development, Inc., a non-profit arm of the Housing Authority of Bowling Green, and as such, garners trust among its residents. These residents are often-times clients of POP-UP. As more POP-UP clients are awarded funding and start or enhance their small businesses, especially those businesses located in the Housing Authority area, word is spreading among the community about POP-UP. Bowling Green City Commissioners are also learning about POP-UP due to the proposed Accelerator (spaces for affordable commercial rent for small businesses) to be voted on by them next month. Several referrals to POP-UP have come from City Commissioners themselves. 

For its communication strategies, POP-UP has a webpage,  (www.habgpopup.org) and several social media accounts which promote funded POP-UP clients.

POP-UP staff have hosted or been presenters at several area workshops for small business owners.  

The quantitative outcomes initially used to measure the program’s success include:

• Eight to 10 clients in the POP-UP pipeline at any one time.
• Two successful POP-UP Board loan application per quarter for a total of eight per year.
• Total number of people served per year: 30.
• Within the first year of the program, six clients will begin repaying their POP-UP loans.
• Increase by 10% per year, for the next four years, each of the numbers above.
• At least six loan recipients will still be in business at year-end, for each year the POP-UP program is in operation.
• At least 50% of businesses funded will still be in business after 5 years

POP-UP has successfully surpassed the initial goals and is only limited by the amount of time the Lead Consultant has. Bringing on additional consultants would only increase the number of funded clients. A process is in place for a POP-UP Vetting Committee to make recommendations to the full POP-UP Board, should more clients need to go before the Board. 

The pieces are in place for this to be scaled to other communities. The program was started, in part, because there were no African American commercial lenders in Warren County. Local banks were willing to contribute funds for loans because they recognized this, which may be the case in other areas. The university connection is a solid one, that not only benefits the small business owners, but the students who get to work, and make a difference, for minority businesspeople! 

Dr. Dawn Bolton, team lead, retired from Western Kentucky University (WKU) in Bowling Green, Kentucky after teaching for over 30 years in Business. She last served as the WKU Director of the Center for Entrepreneurship & Innovation. Dawn guided the creation of countless business plans and pitches for classes and for state/regional/international competitions, and earned the 2016 Small Business Institute® National Best Practices Award for starting a WKU Entrepreneurship Lab.

Mr. Abraham Williams, Executive Director of the Housing Authority and POP-UP Vice Chair has over 40 years of experience assisting minority and low-income individuals.  He is responsible for starting multiple programs to assist minority and low-income individuals during his tenure in public housing and has also served on multiple diversity and policy boards. 

Dr. Whitney Peake, a member of the Board since its inception, teaches and researches in the area of entrepreneurship. She provides valuable insight and assistance, and leads the senior-level capstone course for WKU business students, which works with funded POP-UP clients on student projects. 

Mr. Don Vitale. Board Chair, and co-creator of POP-UP, founded his own company, DESA International, and then created one of the country’s first leveraged management buyouts of it. After he sold DESA, he founded Manchester Capital, LLC, in an effort to continue his interest in the growth and development of innovative business ideas. At one point he listened to over 100 pitches per year, with new business propositions on his desk at least two days out of five in any given week. 

The POP-UP leadership team is always looking for funding opportunities to further support its efforts. Funding for microloans, consultants' pay, and oversight is critical to sustaining the success of the program. 

Based on current and past meetings with POP-UP clients, it has been evident that minority businesspeople struggle with proper accounting practices necessary for long-term financial stability in their businesses. Providing financial partners will assist POP-UP clients in their ability to acquire good  financial practices. 

POP-UP would benefit from partnering with additional financial institutions to facilitate relationships with minority businesspeople.  Local accounting firms and local social media firms would make good partners for our POP-UP clients, as clients need support in these areas, too.