SAN FRANCISCO (KGO) -- A new website is allowing small businesses to get money that is different than a loan from a bank. The website SMBX allows people to give money to a business on the website.
"We connect local small businesses with people in their community who want to invest in them," said Ben Lozano, the company CEO. "It could be the Instagram followers of the business, it could be customers of the business, people in the community who know about the business."
It is an investment. Anyone who sends money on SMBX will get their money back with interest. If you give $50 to a small business, you will get more back in monthly installments. It works as a loan for a small business. Once they earn what they need, they will have to start paying the money back.
"They come and directly buy bonds that are issued by the businesses, listing the bonds on our website," Lozano said. "The business, instead of paying back the loan to a bank, they give their community principle interest monthly."
Jessica Sullivan and Laurel Robinson own Poppy, a new brunch restaurant in San Francisco. Poppy is currently listed on the website, and they are trying to raise $75,000.
"We are a daytime concept," Sullivan said. "we are full-service lunch and that's serving breakfast and lunch all day."
They plan to open their new restaurant this year after construction is done. They say the money raised will go directly to the business.
"We are true small business owners in San Francisco," Robinson said. "We have been raising money for this through private equity, just the two of us, through anyone willing to listen."
They say this money means something different than borrowing from a bank. They know the community is investing in them.
"I think Jessica and I both agree, in San Francisco, small business are what really kind of make a difference," Robinson said. "We are going to show up for our block and our neighborhood in a different way because we are so invested in our space in our community in our neighborhood and the city in general."
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