Chattanooga's biggest credit union marked National Small Business Week Tuesday by launching the second year of its Idea Leap grant program that will award 10 small businesses money to grow their enterprises.
The Tennessee Valley Federal Credit Union (TVFCU), which in 2016 began making loans to startup businesses which have completed assistance programs offered by local counseling and assistance programs, is using the proceeds from those loans to award $55,000 to startup businesses each year in its 13-county service territory.
"As a community-owned credit union, we realize that a rising tide lifts all boats and we're eager to help grow Chattanooga's startup community," said Tommy Nix, vice president of business and commercial services who helped develop the lending program three years ago.
TFVCU has made 87 of the Idea Leap loans and has only had one delinquent loan repayment and no loan losses so far, Nix said. The loans are provided upon the recommendations of a variety of local agencies which offer small businesses training, counseling and accelerator programs to help them grow. The collaborators with the credit union include the Service Corps of Retired Executives (SCORE), LaunchTN, The Company Lab, the UTC Veterans Entrepreneurship program, the Tennessee Small Business Development Center, Causeway and Brightbridge.
Nix said small businesses that have completed training in such programs have an 82 percent better chance for success than do other small businesses and the Idea Leap loan program has verified the importance of such local assistance programs.
Brianna Hager, who started B's Sweets offering cakes and pastries at the foot of Signal Mountain in March of 2012, got the first $7,000 Idea Leap loan in 2016.
"There was a nail salon next to me and, with that loan, I was able to take over that space and expand the business to start teaching classes and add more supplies to sell," Hagar said Tuesday. "That really helped to get us started and succeed and now we're applying for one of the Idea Leap grants so I can step up and build my own facility."
The winners of the first Idea Leap grants TVFCU awarded last fall each said the grants also helped their businesses grow.
Amanda Varnell, owner of Dish T'Pass, said the grant allowed her as she approached age 50 to redirect her business toward her passion of teaching others about cooking and diversifying what had been mostly a catering business since its start in 2012.
"As many small business owners know, I would often say if I only had a little more time and a little more money I could develop a new revenue stream and really fulfill my dream," she said.
That dream was realized when TVFCU awarded the catering and recreational cooking school a $15,000 grant last year to begin an online, interactive cooking course. At the same time, Varnell said she also won a three-week residency at the Hambidge Center for Creative Arts and Sciences in North Georgia.
Other grant winners, including Mad Priest Coffee and the Chattanooga School of Languages, used grant awards to add new facilities and courses and enlarge their footprint.
"It was a great help and a verification of what we were doing," said Laurie Stevens, the top award winner last year at the Chattanooga School of Language.
The winners were selected last year from more than 200 small business applicants and Dionne Jennings, vice president of diversity and inclusion for TVFCU, said she hopes to double the number of applicants this year.
Grant applications will be accepted at www.tfvcu.com through June 7 for businesses which have been in operation for at least one year and have 20 or fewer employees.
The grants are funded with profits TVFCU had made from the Idea Leap loans, Nix said.
The winners will be announced in September and the top 10 businesses will get to pitch their business plans to the TVFCU Idea Leap Grant Advisory Committee during Startup Week in October.
Contact Dave Flessner at email@example.com or at 757-6340