The Goldfish Tavern, a bar in Tacoma that first opened in 1933, and has been closed for the last few years, is getting a new life thanks to a unique type of loan. It combines the concepts of crowdfunding and an interest free bank loan.
Old gas tanks buried under the ground on the property, located near the entrance to Point Defiance Park, make it impossible for the owners to get a loan from a traditional financial institution.
“It’s ridiculously unbelievable. This was a community, icon landmark that was going to get demolished,” says Adam Dopps, one of the bar’s owners.
The City of Tacoma’s office of Community and Economic Development told Dopps about a different way to get financing.
If a business owner is able to raise chunks of money from friends, family and neighbors, then the final amount would be matched dollar for dollar by a zero interest loan from a nonprofit called Craft3. Another nonprofit, Community Sourced Capital, would help raise money and manage the loan.
Dopps and his partner raised $25,000 and ended up with a total of $50,000 to spend on repainting the old tavern and updating the inside.
“And if it wasn’t for this type of lending it never would have happened,” says Dopps.
Investors in these projects are not looking for financial returns. “Places that have thriving local economies are places that have more jobs, higher real estate values and greater civic engagement and you’d see that as your return,” says Rachel Maxwell, the co founder of Community Sourced Capital, or CSC.
If a business wants to raise money this way, they pay $250 to run an online campaign on CSC’s website. People can buy $50 “squares.” Investors are called “squareholders.” Once a campaign raises its targeted amount, the business pays CSC $50 a month until the money is paid back to investors.
The owners of the Goldfish will have three years to pay their loan back. They plan to open for business sometime this summer, under a new name: The Defiant Goldfish.