When the sun goes down in Northwest Arkansas, Amanda and Melvin Khanga get to work. Under cover of darkness, they set out across the region to install surprise yard signs at local homes and businesses.
Amanda is emotional talking about their budding business, which so far has touched everyone from pediatric chemotherapy patients to 100-year-old military veterans. “When we started, we thought we might build up some retirement savings, but we had no idea the joy that it would bring to people. Our clients wake up and feel celebrated. They feel honored. They wake up knowing someone loves them.”
The Khangas’ path to becoming regional franchisees of Card My Yard was anything but straightforward. A “Texas girl born and raised,” Amanda met the Malawi-born Melvin after they both relocated to Northwest Arkansas for college, where Melvin now works in transportation logistics and Amanda in tourism hospitality. “This community is home for us now. The people we’ve met here, serendipity and the good Lord opened the door to greater opportunity,” say Amanda.
While volunteering at a local Rotary Club event in November 2020, they chatted with a friend whose Card My Yard franchise had expanded so rapidly that she could no longer keep up. The Khangas knew instantly it was a fit, and sought out a loan from a traditional lender using their recently-purchased Springdale home as collateral.
But the bank wasn’t able to loan them what they needed due to a lack of collateral. “It felt like the opportunity was floating right in front of us but we just couldn’t reach out and grab it,” says Amanda.
Sensing their determination, the banker referred them to Fayetteville-based Communities Unlimited, a nonprofit lending and technical assistance organization custom-fit for their needs.
“Any person who has the courage to step out and start a business, who sees a need in their community and wants to fill that gap, these are the folks we want to work with,” says Ines Polonius, CEO of Communities Unlimited, a community development financial institution (CDFI).
To help aspiring entrepreneurs like the Khangas sidestep traditional lending measurements like credit score and lack of collateral, Communities Unlimited instead relies on intense support and technical assistance for their borrowers to lower the risk of the investment.
“Through years of experience and more than 40 tools we’ve developed to help our entrepreneurs plan and grow their business, we make sure all the pieces are in place for them to succeed,” say Ines. “It also shifts the power dynamic of a traditional lending relationship. By not relying on available collateral to make a loan, we can’t be successful unless they are.”
Since 2001, Communities Unlimited has made more than $45 million in loans to communities and businesses across 24 states, mostly in high-poverty, rural areas. With support from the Walton Family Foundation, Communities Unlimited established an evergreen loan fund explicitly for underserved entrepreneurs in Northwest Arkansas who have been excluded from traditional banking. Since 2020, they have made 42 loans totaling $438,000 in the region.
The foundation supports Communities Unlimited as part of its efforts to build an entrepreneurial ecosystem in Northwest Arkansas that elevates small businesses and builds a pipeline for diverse entrepreneurial talent.
To obtain the needed funding, the Khangas were assigned a CU management consultant, who walked them through every step of creating a successful business – from how much debt they could take on, to business projections, to eventual expansion into new territories and services. “The process with CU was as real as it gets, we had to do some homework for them,” says Amanda. “When we came to them we were really only thinking about what was right in front of us. Our advisor Brian Wells allowed us to think about this undertaking over an extended period of time. It was vital insight.”
Now that their business is up and running, the Khangas still have calls with Brian, who helps review their finances and answers the inevitable questions that arise. “The fact that Communities Unlimited is still with us is so reassuring,” says Amanda. “There has been so much prep work, and I know we have the tools needed to not only be successful but to keep growing.”
As Northwest Arkansas continues to become a more popular place to live and work, Ines views her organization as one of a number of critical support services that work to ensure it remains a place full of opportunity for every resident. “Large, traditional businesses have done incredibly well here, but we find ourselves at risk of becoming an area of great economic disparity. Right now, we are in a unique position to shore up resources for our underserved populations to make sure we develop an entrepreneurial ecosystem that works for everyone.”