By Karen Khan of Fifty by Fifty

The Cheese Board Collective, in Berkeley, CA, has been owned by its workers since 1971.

Excerpt: For worker cooperatives, one of the barriers to growth is access to capital. Small business loans usually require the business owner to offer what is known as a “personal guarantee”—i.e., if the business fails to pay off a loan, the owner is on the hook to pay it back. Without a lone owner to guarantee the loan, lenders have been wary of lending to cooperatives, where multiple people own the business. To help grow local cooperatives, Berkeley, CA, is changing the rules.

Berkeley established a small business loan fund with a $500,000 grant from the U.S. Department of Commerce Economic Development Administration in 1987, writes Oscar Perry Abello in Next City.  The fund has been used to support minority-owned and women-owned businesses denied traditional loans, but because of the personal loan guarantee, loans to cooperatives have been exceedingly rare.

Read the full article here.

(Originally published on November 19, 2019.)