College students are often accused of living in a bubble; whether dorms are in the middle of a rural area or at the heart of of a city’s downtown, their inhabitants are frequently seen as being out of touch with the world outside of frat parties and midterms. This cannot be said of Rohan Mathew and Joe Shure, two Rutgers University alums whose time in New Brunswick inspired them to create a nonprofit dedicated to helping a segment of people who are often ignored.
“We were both undergraduates at Rutgers and we both lived far enough outside the campus bubble that we… saw a lot of really sad things happening. We felt that we had a responsibility to help,” Mathew said. “These are people who, their odds aren’t really stacked for them. They’re growing up in a neighborhood where businesses are boarded up, no entrepreneurial figures in their lives. They say ‘I want to start a business,’ and they get laughed at.”
Mathew and Shure wanted to create a resource to help these fledgling entrepreneurs, so in 2008, they launched the Intersect Fund, a nonprofit that helps microbusinesses (those with five employees or less) with both business advice and funding. While the Fund served its first client nearly five years ago, it has recently hit its stride.
“In 2011, we lent out $120,000. Last year we lent out about $288,000. This year, we may hit one million dollars,” said Mathew. “We’ve assisted more than 2,000 businesses all over New Jersey.”
While rates on Intersect Fund loans are 15%, the loan amounts are so small that the real capital comes from the generosity of others. The growth has been made possible largely due to federal and state grants — though the Intersect Fund has received private donations, too.
It’s a far cry from the Fund’s earliest days, when Mathew and Shure had $1,000 to work with. “We had heard and been inspired by microfinance in the international world. Unfortunately, [to do that] you need money, and we didn’t have a lot of it,” Mathew explained, noting that the appeal in providing smaller (micro) loans lies in the fact that there’s not a large market for them: they’re not profitable for banks, so the banks don’t bother. However, this leaves an entire population of business owners with limited options when they need a spare $2,500 or $1,000.
“There are 750,000 of these microbusinesses in New Jersey, and everyone ignores them,” Mathew said. “Consultants don’t want to work with them. We come along, and that’s all the marketing we need to do. If you can find that market niche you can be very successful.” If, that is, you can come up with the funds.
While the market niche was there, Mathew and Shure still needed to get around their initial lack of capital. Their solution: turn the organization into one that would offer business advice, too. “A lot of people were interested and hungry for knowledge. ‘How do I market this, how much money do I need to start?’” Mathew said. “The kinds of things that even if you’re good at your craft, doesn’t mean you’re going to be great at business.”
Mathew and Shure began by teaching classes in small business themselves, but have since amassed a team of successful small business owners that help dispense the advice. They’ve also recently moved away from group classes to focus on individual coaching sessions (which, for $39, run for 90 minutes), since people come with so many specific questions that it’s more efficient to sit down one-on-one. It was access to this business acumen that drew coffee-lover Benjamin Schellack to the Intersect Fund.
“We had an idea that we thought was good — a cafe supplying roasted coffee beans,” Schellack said. What he didn’t have was market research, product analysis, anything that would let him know if he had a viable business on his hand. The Intersect Fund coaches helped him connect the dots and by April of 2010, Schellack was selling his own roasts, and just last fall he opened a cafe to go along with the roasting business. Opening the cafe was made possible by a $16,000 loan from the Intersect Fund — their largest loan to-date — for which Schellack is profoundly grateful.
“As a business owner, most of my day goes back to things that I learned from them. And then they helped finance our most recent expansion,” he said. “Pretty much every time I go into the coffee shop I have to thank them.”
Schellack represents one of Intersect Fund’s larger victories, but Mathew and his team take the smaller successes just as seriously. “The best part is just seeing the success stories,” Mathew said, proudly relaying the tale of a single mother who, despite living on Section 8 housing assistance and disability, was recently able to get a $325 loan to repair her sewing machine, which was followed by an invitation from Rutgers to help sew logos onto clothing and other materials. “To you and me, it’s $325 dollars, why would you bother lending that?” he said. “I think that’s a great story. That’s exactly why.”