Presentation by Mihailo Temali, Founder and CEO of the Neighborhood Development Center in St. Paul, MN.

1. NDC:
Building
Neighborhood
Economies from
Within
Rebuilding Neighborhood Markets
February 3, 2015.
Greater Ohio Policy Center, Finance Fund and Ohio CDC Association.

2. Inner city
neighborhoods
University Avenue, St. Paul, 1986
Detroit, 2013
Sears building, South Minneapolis, 2001
 Despite obvious deficits, inner city
neighborhoods have many assets
 NDC’s model links the energy of
neighborhood entrepreneurs to the
vitality of their own neighborhood
 Over 300 NDC-supported entrepreneurs
are open in formerly vacant neighborhood
buildings

3. Opportunity to
build from
within
Dwayne Etheridge, Owner, New Image
Construction and NDC training alumni
and loan client.
• Communities of color and recent immigrants
start businesses at a high rate
• Twin Cities population of color is growing
rapidly
• These communities possess unique market
opportunities and competitive advantages
• Developing these opportunities AND keeping
these businesses in inner city neighborhoods is
NDC’s strategy

4. Twin Cities snapshot
• St. Paul:
• 44% persons of color
• 23% of total population below poverty
• 18% foreign born
• 16% African American
• $47K – median HH income
• Minneapolis:
• 40% persons of color
• 23% of total below poverty line
• 15% foreign born
• 19% African American
• $50K – median HH income
• Metro region: 24% persons of color (676,000
out of $2.9M)
• Forecast: Metro region will be 40% persons of
color by 2040.
Manuel Gonzales, owner, Manny’s Tortas

5. NDC’s Targeted
Communities
• NDC focuses on neighborhoods and
ethnic communities with high levels of
poverty and unemployment
• 80% of NDC’s resources focus on four
lowest income neighborhoods in TC:
 62 – 80% persons of color
 31 – 42% below poverty
 12 – 24% unemployment
• 51% of NDC trainees are under 30% of
AMI, and 81% are under 50% of AMI.
• 41% of NDC trainees have a high
school degree or less. An additional
23% have up to two years of technical
school or college.
Dalton Outlaw, owner, Element Boxing and Fitness
Shongleng Yang, Onwer, Hmong Village

6. What barriers
do inner city
entrepreneurs face?
 Language
 Access to capital
 Relevant business knowledge
 Business networks
 Cultural & religious barriers
 Trust in institutions

7. NDC staff
Culturally competent, business savvy

8. Community
partnerships
 Since 1993, NDC has partnered with 52
different community organizations to
connect with their entrepreneurial talent.
New American Academy
Northside Economic Opportunity Network
Hope Community

9. NDC partners

10. Entrepreneurial
training
 220 low-income
entrepreneurs,
mostly persons of
color, trained yearly
 Provides culturally
competent training in
5 different languages
 All classes are taught
in community
settings
 Partially funded by
local and state
government

11. Small business lending
 NDC makes 40-70 business loans and financings
every year to start up and emerging
entrepreneurs.
 Has provided nearly $14 million in loans since
1993, and more than $1 million last year alone
 Loan capital obtained from multiple public and
philanthropic sources. Ahmed Hassan, Owner, Hassan
Transportation, with new truck with $40,000
Islamically Acceptable Financing from NDC

12. Business assistance
− Record keeping
− Marketing & graphic design
− Energy audits
− Growth planning
− Restaurant & food consultation
− General management
 Services include:
 Most services provided at no cost
 Services funded by multiple public and
philanthropic sources

13. Filling key
vacant buildings
 60 percent of NDC assisted businesses now
occupy a formerly vacant building.
 NDC has redeveloped six commercial
properties that now house more than 120
small businesses.
Plaza Verde, Minneapolis
Midtown Global Market, Minneapolis

14. Positive
community
outcomes
 82 percent of NDC assisted
business owners hire
neighborhood residents
 90 percent say they serve as role
models for youth and/or young
adults in their communities.
 39 percent report they serve as
leaders in groups or organizations
in their neighborhood or ethnic
community
 51 percent say their businesses
serve as gathering places for their
communities

15. NDC by the numbers
NDC staff at the opening of Awash Market in St. Paul
 NDC businesses return more
than $46 million annually to
their own neighborhoods,
and $73 million annually to
the Twin Cities area.
 Approximately 85 percent of
NDC businesses are
entrepreneurs of color: 40
percent African American, 39
percent recent immigrant and
6% Native American.
 Full and part time jobs in
NDC-assisted businesses: 2,285
 Average hourly wage: $12
 Cost per job: $4,941
 Average Number of Employees per Business: 4

16. State of Minnesota and NDC
NDC has been supported by the State of
Minnesota in multiple ways:
• Loan capital – “Urban Initiatives Loans”:
 $2.2 M to NDC pver 10 years.
 $18M / 806 loans via 7 lending
partners;
 73% borrowers of color;
 leveraged $90M private debt
• Business assistance and training funding:
 $500,000 over three years to NDC
 $2M/year in TA grants to 16 CBO’s
 Assisted 4,061 businesses
 Created 2,377 jobs
 Business incubtors: $1.1M toward the
building of Midtown Global Market
• New Initiatives to reach deeper into
communities of color