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Press Release
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Community bank places big bet on crowdfunded small businesses  September 27, 2016 - While many community bankers are still deciding whether crowdfunding is friend or foe, Sausalito-based Breakaway Funding found a bank willing to allocate $10 million of its loan portfolio to companies coming through Breakaway's crowdfunding platform. Fresno First Bank agreed to the $10 million allocation for small businesses ranging from startups to those with up to $25 million in annual revenue. "Companies in this portion of the market often have difficulties in securing the financing they need to start to expand their operations," said Steve Miller, president and CEO of Fresno First, which was founded in 2005 and has $300 million in assets. Breakaway, founded in 2013 by former Marin County community bank CEO Kim Kaselionis, helps Main Street businesses raise equity capital from their customers or other supporters in the community. That equity capital helps small business owners get bank financing. "By working through the hybrid crowdfunding process they will have an opportunity to raise the required equity, to strengthen their financial profile and to qualify for more traditional bank funding," Miller said. Breakaway Funding this month opened an East Coast marketing office in Jacksonville with the hiring of Richard Cuff, who will serve as Eastern marketing director. Cuff is an entrepreneur who also serves as the executive director at the League of Florida Orchestras, a nonprofit focused on teaching pre-schoolers the violin. Breakaway Funding has worked on specific financings with San Francisco-based Trans Pacific National Bank and Santa Rosa-based Redwood Credit Union, but Kaselionis envisions the day when community banks routinely partner with crowdfunded small businesses. As for Fresno First's loan allocation, Kaselionis said, "It's a commitment to the community that says, 'We get it.'" |