Craft3 and Megan Hulsey
Craft3 lends money to businesses, non-profits, and individuals. But this non-profit lender is not like your average bank or loan company. Instead, it’s a Community Development Financial Institution, or CDFI. They focus on providing financial assistance through lending to borrowers who historically have been unable to access capital. And Craft3 likes lending for projects that create long-term, generational wealth.
Craft3 is based in Astoria, OR, and has eight offices throughout Washington and Oregon. They have both a commercial and a consumer branch.
Megan Hulsey is the Business Lender for the 4-person Spokane office. She can provide commercial loans from $25,000 up to $4 Million.
Their Role in the Community
As she put it, “our goal is to provide that stepladder to assist people who have struggled with credit issues or had prior business challenges. Or simply lack the collateral to go in and refinance their business. We help them have access to the capital they need to fund the resources they need to actually grow.”
Craft3 sees its role as not competing with banks and credit unions, but partnering with them. By providing loans that might be deemed “too risky” for commercial banks, Craft3 provides a bridge for their clients to grow enough that they can return to their regular bank in 3 to 5 years, and refinance any outstanding debt at lower interest rates.
Evaluating Potential Clients
Craft3 is unique in looking beyond credit scores and collateral when evaluating potential clients for loans. Hulsey describes their process this way: “We will spend more time getting to understand the business, including its opportunities and weaknesses. We want to know how this money will be catalytic and how it’s going to bring about change or improvement.”
From their evaluation, if the lenders at Craft3 don’t believe their client’s business project will be successful, they will help the client to improve their plan. The next step could be sending them to a business counselor at the Small Business Development Center (SBDC) or the Center for Innovation at WSU. Craft3 has numerous resources available to help clients create a realistic plan that makes sure they’re actually going to be able to achieve their goals.
Craft3 is funded by loan fees, interest, and federal and private grants. Interestingly, individuals can also invest in their institution if they are accredited investors. The interest earned by these high-net-worth individuals is approximately 6% annually.
Who They Lend To
This non-profit has helped many kinds of businesses. These include bakeries, restaurants, non-profit organizations, charter schools, a veteran’s ranch in Oregon, a mushroom farm, and even a shopping mall in Seatac, WA.
So out of all the industries Craft3 has worked with, what’s Hulsey’s favorite industry to lend to? “I love manufacturing. I like companies that create and build things because they create good, high-paying jobs and are also one of the best economic builders in a community. So I think manufacturing is critical, in terms of bang for your buck in building community and jobs.”
Most Proud Of Helping
When asked about which organizations she’s most proud of helping, Hulsey highlighted two of these: Lumen High School in Spokane is a charter school for parenting teenagers. “All of the students there have a child, and part of what they needed was a little assistance doing the build-out for the affiliated daycare. And so we provided some funding for that.”
The other is a restaurant in the Gonzaga district called Indigenous Eats, serving contemporary Native American comfort food. “I love that we’ve been able to work with Indigenous Eats to create some opportunity for Native Americans. Our funding allows them to share their culture and community through food, which is one of the best ways to share your community. So I love that one.”
For Hulsey, it’s very fulfilling to help organizations that don’t qualify for a traditional loan. “I love being able to say: we’ve come to a solution. Yes, we can help you. It’s because I know that I’m keeping something alive – we’re building something new in a community that wouldn’t have had it otherwise.”
Experience Being a Valley Chamber Member
Has being a member of the Valley Chamber helped Craft3? “Absolutely!” says Hulsey. “they’ve created a platform to help make sure that people are aware of the services we offer in the community. They have offered introductions for me to people they thought I could help. And for people who can help Craft3, just by getting the word out or being naturally collaborative.”
Hulsey goes on, “What I really love about the Valley Chamber is the availability, that is being able to connect directly with other members and the sense of community they generate. They hold very great and meaningful events that allow really good connections to be fostered. And there are no artificial bridges between people that get in your way. So if you show up at an event, there’s nobody you can’t talk to.”