Starbucks is embarking on a fantastic initiative that will infuse much-needed lending capital to small American businesses. Via Community Development Financial Institutions (CDFIs which are mostly non-profit entities serving underserved communities) Starbucks patron donations will be leveraged to eventually fund lending to those businesses most capable of creating new employment in a down economy.
I came across this article in the New York Times. The initiative is fantastic – your donation when you buy a cup of coffee goes directly to the CDFI which works in a similar manner to online microlending platforms for small businesses in the developing world. Yet what bugged me about this article was the time spent lambasting the government and formal sector banks for what they should have or should be doing with regard to small business development and thus Starbucks “has” to step in and partner with this dynamic community lender to fill the void. Huh?
Starbucks and the CDFI folks who came together on this is precisely the reason why the American economy is so resilient. It is because we do not expect the government to be involved in all facets of the economy, down to job creation of all things. I think what this economic crisis has hopefully revealed is entrepreneurial spirit and linking folks together for a common cause is a much more reliable and solvent vehicle for development than government can ever be.