Oregon Business Magazine, July 1999
Not Ready for Prime Rate
Cascadia Revolving Fund opens an Oregon office and promises to increase financing for not-yet-successful businesses.
By Teri Cettina
It’s the chicken or the egg predicament of the business world: A small company needs a loan to build a successful business – but until it’s successful, most banks won’t lay out the cash.
Jan Lajoie, co-owner of Northwest’s Best catalog company, knows that dilemma all too well. When she and her daughter, Jamie Engebretson, opened their Medford mail-order business five years ago, they were confident they could do it without bank financing. Within months, however, they hit a crisis.
Their sole investor faced a personal emergency and had to cancel most of his loan. On a shoestring, the two women put out their first catalog, showcasing hand-crafted products created by Northwest artists. Then they began the struggle for replacement financing.
“Because we’ve never owned our inventory – we sell our artists’ pieces on consignment – and because we weren’t yet turning a profit, no bank would touch us,” says Lajoie. “I remember one banker asked me, a middle-aged woman, if I could just get my father to co-sign a loan with me. Imagine that! I was even told that if I wanted to open a little dress shop or maybe a nice restaurant, then maybe I could get a loan. It was infuriating.”
Lajoie and Engebretson pieced together loans from friends, family and the Small Business Administration. They maxed out personal credit cards and even went without electricity some months. They gave up on the idea of regular paychecks.
Then, as they reached yet another financial crunch, an acquaintance introduced Lajoie to the Cascadia Revolving Fund. As the owner of a business that preserves jobs in a rural area, she learned she could qualify for a $25,000 loan, although at a somewhat higher interest rate than a bank would charge. She took it.
“We really needed people who believed in what we were doing and saw our profit potential,” Lajoie says, “and Cascadia came through.”
Full article text available upon request.
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