This Non-Profit Lender Helps Underserved Entrepreneurs Become Local Moguls

As the saying goes, "It takes money to make money."

But that starter capital is hard to come by for people from low-income communities and working class backgrounds. 

If you've seen Coolhaus Ice Cream while shopping at Whole Foods (or for sale in its fleet of trucks, or in brick n' mortars across the country), we wouldn't blame you for assuming it was a hip label by Nestlé or a VC-backed startup.

In reality, it's a grassroots, woman-owned enterprise that got its start thanks to financing from an innovative non-profit called Opportunity Fund—an organization dedicated to providing working capital to the working people that traditional banks and lenders turn away.

Opportunity Fund believes that small amounts of money and financial advice can help people make permanent and lasting change in their own lives, driving economic mobility and building stronger communities.

And they've proven this time and time again, not only with Coolhaus Ice Cream, but thousands of entrepreneurs all throughout the country that never would have gotten their start without the support of just a tiny amount of seed money. 

At the 2018 Make Change Awards in January, Net Impact LA was honored to present the Impact of the Year Award to Opportunity Fund's Regional Director of Southern California, Iosefa Alofaituli

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We had a chance to catch up with him to talk financing, growth and some of the delicious food brands that never would have gotten to the market without a little financial assistance:

Net Impact LA: What most drew you to the work and mission of Opportunity Fund?

Iosefa Alofaituli: What most got my attention about Opportunity Fund is the human story behind its mission. All of our clients are these hardworking, innovative, resourceful, resilient, persistent individuals whom, when given the right opportunity or resources, can create such amazing things. The access to capital creates truly amazing businesses. And what ripples out of the imagination and creativity of these entrepreneurs is jobs and livelihoods for people in their communities. Just one business in one area can have a major economic impact, and it all starts with access to capital.

NILA: What kind of impact has Opportunity Fund's work had on Southern California?

IA: We're coming off of our most impactful year yet in Southern California. In 2017 we were able to originate over 1,200 loans and invest over $35 million. That translates to the creation and sustainment of about three jobs per loan. So over 3,000 jobs were created last year as a result of the capital we provided. We've also discovered that for every dollar we invest, there's an an additional two dollars of economic activity in the community. We essentially helped create an additional 70 million dollars of economic activity in Southern California that would not have occurred without the infusion of loan capital to these entrepreneurs. 

With microbusinesses, the microfinancing is a way to invest in the local economy because these entrepreneurs tend to hire from within their community. They don't outsource jobs to other regions or other states. 

NILA: What are some of the biggest successes you've seen for entrepreneurs that you've connected to capital?

IA: The faces that these funds serve are really varied. 60% is low to moderate income. We are serving those who wouldn't be able to access resources otherwise.

Lia started her now famous World Empanadas business in the back of a liquor store. Based on a huge following she had the ability to grow. We helped her buy her first walk-in freezer which increased her capacity and ability to deliver. She became one of the hottest caterers in Burbank, working with all the studios, including the Jimmy Kimmel Show. For her, part of that growth was getting the necessary equipment.


Coolhaus Ice Cream was co-founded by Natasha Case. She is a trained architect who decided to turn her design passion into ice cream sandwiches. After gaining a following at Coachella, she realized she could grow this into something major, but needed a startup loan in order to grow. No lenders in the traditional financing field would give her a loan. But Opportunity Fund did.

Now she's in Whole Foods and ten different states. Has a fleet of trucks and sells at a few brick n' mortar locations. Her distribution is far and wide. She is someone who had the talent and drive and just needed some financing for that initial truck, which helped take her business to the next level.

NILA: What are some goals or projects you're working on for 2018?

IA: Historically our outreach has been boots on the ground, field based loan consultants knocking on doors, stomping the pavement, building relationships with small business owners. We've also developed relationships with banks as they decline small business owners so they can be a path to us.

Our focus now is on technology and partnerships. Last year we launched a pilot with LendingClub, and set it up so that if someone gets declined for one of their loans, they can automatically pre-approved by Opportunity Fund. We've had really good results with that so far, and we're continuing to build that. 

We're also focusing more on the ground to create a stronger eco-system within our region. Within LA we have twelve community partners that provide some sort of business service or lending, and we are now partnering with these groups so they can launch their own microloan program, without having to build out the infrastructure of the fund to support it. Essentially we are white-labeling product so that other partners can enhance their own product portfolio and offerings to the community. It's a win for the partner because they can better serve their community, and its' a win for us because we're reaching people we haven't been able to until now.

What I'm really excited about for this year as well is, in addition to this tech and partnership focus, we also see that only four percent of small business bank loan dollars go to women. We want to be part of the solution and leverage our own model and product that's been successful in serving the underserved to move the needle on that terrible statistics. We're launching a new initiative called the "Power of She" so we can better understand the problem and develop some solutions. We're in the process of building an advisory board of successful women entrepreneurs that will help to inform us of experiences that they've had and help us direct our research.


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