Investment in the community goes beyond dollars to sense
By Erik Furlan
With a dual-purpose mission to create affordable housing and ensure access to capital, the Harbor Bank Community Development Corporation is committed to investment in the Baltimore community.
“As time has gone on, banking has become less and less relationship-based, so there was a need to have a subsidiary that carried on the ability to really have an impact for local businesses and entrepreneurs,” said the organization’s senior vice president, John Lewis. “Access to capital is difficult, and unless you are being innovative or more flexible in the way that you provide funding, you’re not getting the different results with respect to actually getting capital into the hands of entrepreneurs and small businesses.”
Lewis sees the HBCDC’s connection to The Harbor Bank—one of only a few community banks left in Baltimore—as a critical relationship for continuing their work in local communities.
“Community banks mean local decision-making, knowledge of the market area and long-lasting relationships with members of the community,” he said. “The CDC is similarly situated in terms of its position within the community. The work that we do is driven by that informed understanding of the community.”
And it is that informed understanding, Lewis explained, that allows them to make loans others may not make to entrepreneurs that may be overlooked by some of the larger banks and organizations in the area.
“You’ll see us do everything from pre-development loans, loans with royalty agreements tied to them, or convertible notes or straight equity investments, because those are some of the forms of flexible and patient capital that are needed by entrepreneurs,” Lewis said.
Working with customers so closely, HBCDC shares in the successes and accomplishments of those it has helped.
“We’ve got people that have come in, that no one else really would have financed, so they get to where they win their first big contract and things like that, those are monumental accomplishments,” Lewis said.
As for the HBCDC’s role in the community, Lewis feels the CDC will continue its work, making an impact in area communities.
“I think our role will always be to be catalytic in the work that we do, in the advice that we provide and the capital that we make available,” he predicted. “Banks are conservative institutions, and there are challenges of a financial nature, opportunities that our CDC is uniquely situated to address.”
Lewis emphasized that the Community Development Corporation is one part of the overall Harbor Bank organization, founded to provide opportunity across all segments of Baltimore.
“The CDC really just allows us to do some things with exceptional focus, but it’s just one piece of a larger organization that has had a great impact on the city and all the communities.”
The Harbor Bank announced in mid-February that it and HBCDC are teaming up with Maryland Technology Development Corp. (TEDCO) to start a new fund geared toward African-American entrepreneurs. Called the Minority Business Pre-Seed Fund, the fund plans to provide $40,000 to each of 10 entrepreneurs over four quarters. Half of the funding will come from the HBCDC, the other half from TEDCO.
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