After three small business loan denials, Roscoe village bakery turns to crowdfunding

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Valeria Taylor didn’t think she would ask her community to help move Loba Pastry + Coffee, her five-year-old Roscoe Village bakery and café, to its new location. But after financial institutions rejected her applications for a small business loan for the third time, she felt desperate and launched a GoFundMe campaign earlier this week.

Loba’s customers have already helped keep the small independent commercial bakery operating during the pandemic. Once known for his kouign amann, Loba has expanded his menu over the years. Taylor draws inspiration from her Mexican roots with specialties like a mole butter croissant.

But the bakery is in crisis mode. The crowdfunding campaign is asking for $ 25,000. This morning, the effort raised more than $ 18,600. Taylor notes on his GoFundMe page that the average cost in Chicago to build and design a restaurant or cafe is $ 200,000.

“I debated whether to do it or not,” Taylor says. “I think the community has helped me a lot already, getting me back on my feet from 2020. It wasn’t just, ‘Oh, I really tried. I had the support of the whole ass community. I didn’t want to ask for more. Maybe it’s the immigrant mindset and the misconception that we’re just here, taking things for free. But at the moment, there is no other way.

If all goes well, Taylor plans to open their new location in October at 1800 W. Addison Street. The cafe closed on Wednesday in anticipation of the move, as Block Club Chicago reported.

Taylor is an industry veteran who has worked at Blackbird in West Loop, Charlie Trotter in Lincoln Park, and Coco Pazzo in downtown Chicago. The reviews on the GoFundMe page are full of supportive messages from customers. “[Woman of Color]-possessed, stellar pastries, the best heart, ”wrote one. “How could we not support this? “

In solidarity, its employees are organizing an online raffle to raise funds starting on Friday via Instagram stories. (Prices include private focaccia lessons.) There will also be a Friday rally at the store from 8 p.m. to midnight, but Taylor prefers people to donate at home because the space is too small for adequate social distancing.

Taylor wants to stay in the neighborhood, but even before her lease at 3422 N. Lincoln Avenue expired, she knew she would have to move and needed a loan. Its owner was only offering a two-year extension, not enough time to make renovations and plans for a post-pandemic era: the kitchen had to be remodeled. The communal table – the only seat in the cafe – had to be removed. We needed a bathroom accessible to people with reduced mobility.

She thought she had found a solution. In June, Taylor signed a six-year lease at a former dry cleaner a few blocks from Addison. She had the cooking appliances and equipment she needed and planned to do most of the renovations herself. She calculated that it would cost around $ 60,000 to complete the construction and bring the space up to restaurant code. For July and August, she was paying rent for two storefronts, and Loba would have to close her doors for at least two months while she moved and tidied up the new location, which means no income. His savings wouldn’t cover all of that.

She had previously secured a business loan, when she went into business in 2016, taking over former Bad Wolf Coffee after her former boss Jonathan Ory moved to South Carolina. She immigrated to the United States in 2004 from Guadalajara and worked mainly in minimum wage jobs; she had had no savings and bad credit. Earlier this year, she also received two Paycheck Protection Program (P3) loans, totaling $ 20,800, to keep the doors open. This amount is nowhere near what Chicago’s biggest restaurant companies have received.

This time, Taylor thought, it would be easier. “I thought after being in business for so long, after surviving the pandemic, it wouldn’t be that hard to get a loan,” she says. ” I have the [tax] yields, cash flow, numbers are good, my credit rating is pretty good. Last week I was turned down for the third time. I can not believe it. There is a secret to getting a loan, and I don’t know it.

She went to the banks. She applied to the Small Business Administration, which offered $ 10,000. She applied to a non-profit organization that specializes in helping people like her – women, immigrants and people of color. They gave her $ 5,000 the first time around, but now, even though she was in a much better financial situation, they only offered her $ 8,500. She is single and could not apply to what she calls “mom and dad’s bank”. She considered an investor, but dismissed the idea: she saw that the people with the money made the decisions, and she didn’t want anyone interfering with the way she runs her business or telling her that she couldn’t pay her employees more. The $ 25,000 GoFundMe campaign was the absolute last resort.

She doesn’t expect the $ 25,000 to cover the full cost of the renovations, but she hopes it will be enough to keep her going. She will continue to ask for loans. She understands the reality banks face: it’s easier for a business to default on a loan than it is for an individual, and they need to make money too. Every loan officer has looked at their financial information from 2020, which hasn’t been their best year in business, for obvious reasons. But no one else has had a great 2020 either, she argues, with the possible exception of Amazon.

“For people like me,” she says, meaning she hears small business owners who are immigrants and people of color, “the system is rigged against you. My business cannot borrow this amount because the bank expects my business to go bankrupt. She is even more angry with the association whose name she refuses to name. “Five years of cash flow, and all I was worth to them was $ 8,500?” If that’s what they give me and I have a pretty good credit score, what do they give people in a worse situation? What about someone who doesn’t speak English as well or has kids? “

Taylor doesn’t give up, however. “I wrote notes myself,” she says. “Like, ‘Do you remember how angry you were? Do not come back. Don’t change your mind.

La Loba, 1800 W. Addison Street, scheduled to open in October.


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