Loans Support Food Sustainability

When Zac Hosler needed funding in 2014 to build out his aquaponics business in South Kona, he believed he would be rejected by a bank.

“Financing for farmers is hard to come by,” says the majority owner of Ha Farms Inc. “We looked around but didn’t see many options. Banks may say they lend to farmers, but it’s almost impossible to get a loan from a large institution.”

Hosler heard about the nonprofit Feed the Hunger Foundation, which provides capital to those in the food community who may not have access to traditional financing.

“With Feed the Hunger, we were easily approved and I’m happy with the terms,” Hosler says. “They’ve always been helpful and receptive. I’ve dealt with their CEO, Patti Chang, several times, as well as the loan officer assigned to Hawaii.

“I took out a small loan in 2014 and a larger loan in 2016, and these were important loans. If we didn’t get them, it would’ve slowed our expansion by at least several years.

Chang, 58, co-founded the nonprofit in 2008, after years of involvement in poverty law and women’s philanthropy. “I attended an international microeconomic summit that showed how small-business loans could help impoverished areas, and I wanted to bring that model home,” says Chang, who graduated from Punahou School and Stanford Law School.

“So far, we’ve helped 40 small companies in Hawaii, 30 in California and six in Asia and Latin America with about $3 million in loan capital.

“Our borrowers might be considered by others to be ‘unbankable’ or low-income.  Their businesses are all involved in the food chain in some way. Our goal is to alleviate hunger and poverty and to help develop communities.”

Chang says most of Feed the Hunger’s loans are successful, with a failure rate of less than 5 percent. “We try to work with a business if they’re having trouble repaying the loan. We have partners who can help them with technical advice, such as accounting or purchasing. Many have become successful enough so they can go on to apply for a bank loan.”

Some Hawaii small businesses helped by Feed the Hunger are: VJ’s Butcher Block in Haleiwa, Kunoa Cattle Co. in Kapolei, and Hamakua Harvest and Paradise Meadows on Hawaii Island.

Most of the nonprofit’s funding comes from federal agencies or city grants-in-aid, and the rest from private investors and individual donors. With an annual budget of about $600,000, the agency operates with a staff of five.

Chang says she’s optimistic for the future. “It’s taken us the past 10 to 15 years to assess where we are in regards to food. But now we’re starting to see a younger generation coming in using technology to increase food production in the Islands.”

Categories: Agriculture, Nonprofits, Small Business