YBP MICROLOAN PROGRAM - After learning that our arrangement with the city prevented us from taking out conventional loans because we will have no collateral, Yellow Bike kicked off a micro-loan program to raise the rest of our projected construction costs.  We're asked supporters of YBP's mission and who has some cash in the bank to loan it out to YBP and literally build community in the form of the new YBP headquarters.  The terms were to repay the loan within 5 years, and give a better deal than you can get in your savings account at the bank at 3% interest.  We thought it would be a way to put your money to a good use, then get it back - plus interest!  We raised 100k through microloans for the project and will pay them back over the course of the next 5 years. Read below for more details.

How to Participate -
We are no longer in need of loans - We are leaving this up so other community based organizations may use it as an example,

1. Do you want to get 3% interest on the cash you loan to Yellow Bike for the construction of their new headquarters to be repaid no later than 5 years?
2. Read about the details of the program below and view our sample contract online.
3. Are we good for it? Check out our profit and loss statements for 2008 and 2009. What you will find is that we are a lean machine that runs on volunteers, donations, and a passion for empowering people to use bicycles for transportation. In 2008 we turned a net income of 100k and for 2009 to date we have a net income of 30k. At this rate we expect to be able to payback our microlenders in 3 years.
4. Can't wait to participate? Sign-up on our online microlending form to let us know who you are and how much you are willing to lend. A Yellow Bike representative will contact you and arrange the signing of the contract and exchange of payment.  To keep our books as simple as possible, we're limiting these loans to a minimum of $1000.
5. Please note that our loan is still under negotiation and that we are finalizing our microlending contracts. Once the lease is signed and our contract is finalized we will contact those who pledged loans to sign and transfer funds. If you are interested but still have questions please sign up using our online microlending form and a Yellow Bike representative will call you. The signup does not obligate you to participate.

The Details - We are kicking off a micro loan program to finance the last $93,000 of the total $270,000 of construction costs on our new headquarters facility.  Wheatsville, using a similar program, raised over $715,000 from 160 investors for the expansion of their store.  The Yellow Bike facility will be built on City land and at the end of the 100 year lease, that we signed into effect on 9/9/2009, the building will be turned over to the City.  Conventional bank loans require collateral that is unavailable in this arrangement as the City will own the facility at the end of the lease, thus requiring us to look for alternative borrowing mechanisms.

YBP's NEW Headquarters - Illustration by Iona Bee

The microloan program is a win-win arrangement that will benefit both the lender and The Yellow Bike Project. On one hand, most saving accounts right now are earning much less than 3% interest.  On the other hand, even if we could get a conventional lender for Yellow Bike, the interest that they would charge is upwards of 8%.  This program allows us to give a better interest rate to our lenders than they would get parking their money in a bank account, and we spend less money paying interest on a loan - freeing up more money to fund programs and supplies.  This is about communities coming together to create solutions.

If you are interested in participating, you can preview the draft contract online and then sign-up for the microloan program online.  A Yellow Bike representative will then contact you and arrange the signing of the contract and exchange of payment.  Thanks for considering an investment in Yellow Bike.  To keep our books as simple as possible, we're limiting these loans to a minimum of $1000.  If you'd like to help out, but can't swing a loan at the moment, you can always make a smaller donation here.

To learn more you can read about our new headquarters.