Rethinking Entrepreneurship in the United States

This is a guest blog post by Christina Reif, a Kiva fellow working in Washington, D.C. in Fall 2012. As a Kiva fellow, Christina networked with new partners, trustees, and small business entrepreneurs for the Kiva Zip program.

Ever since I started with Kiva Zip in the U.S. my sixth sense seems to have awakened... I see entrepreneurs... everywhere!

I think my understanding of what an entrepreneur was had until now been quite limited. An entrepreneur was Mark Zuckerberg from Facebook, or Larry Page and Sergey Brin from Google, or someone opening a restaurant. But how about the person selling soda from a pull cart in Downtown D.C.? Or the person that put a card in my mailbox saying "cleaner for hire?"

No. I didn't include them in the same definition -- until now.

So, as I head to the food cart guy in my neighborhood, I walk past a professional looking farmers market stand, a less established lemonade stand, a guy selling the homeless magazine, a make shift sunglasses stall off the main street, and a flower vendor. And it's clear: we need to adjust our thinking about entrepreneurship. All of us, not just the banks who lend money.

The more people ask me why Kiva Zip, the more I realize that it boils down to this: We should understand that being entrepreneurial is a viable alternative to poverty and unemployment. Everywhere!

What seems a normal occurrence in the least developed countries -- to start something small to improve your life and livelihood, seems not to translate to the countries we live in. In our "reality" the only roads out of poverty and unemployment appears to be giving up on your dreams and ideas. We don't see the option to reach for higher goals of starting our own small business as a way out that should be encouraged. Yes, we tell ourselves, we know that people start businesses. But they are middle class innovators, not low-income creators.

Kiva started challenging the perception that microloans for small business entrepreneurs are best used only in the least developed countries. In 2009, the first U.S. loan was posted on and since then has crowd funded more than $5 million in loans to U.S. small business owners.

This initiative is expanding through Kiva's new pilot program, Kiva Zip. The U.S. entrepreneurs on Zip are truly industrious. Food stalls, pet sitting businesses, small startup NGOs, child minders or medical supply distributors... there is no end to the opportunities these entrepreneurs are creating for themselves.

Each of these people share a common entrepreneurial spirit that is recognized by the Kiva Zip lender community. They also share a set of challenges, traditional funding institutions consider their new businesses too risky to support -- no matter how good the business plan.

If you have not been in business for a year you are too high risk. If you don't already have the professional-looking stall, then surely nobody will want your product. If the loan you seek is small and you don't qualify for a larger one, then you can't get a loan. The reality is that most small business startups are heavily in credit card and personal debt before they ever sell their first product. But what if you don't have the credit card to start yourself out that way? What if you are just too poor, too recently out of jail, or too new to the country to have the credit rating to even get a microloan? Does that make your business idea less viable?

Many lending institutions think so...

But I am proud to differ -- and support borrowers on