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Austin Businesses Turning To Crowdfunding

Updated: Tuesday, July 15 2014, 07:46 PM CDT

Austin businesses faced with financial needs are now turning to crowdfunding.

The idea is to raise money through community members instead of leaning on a bank for a loan. It's a concept to give locals what they want, in return expand businesses and get incentives like discounts.

A company called Local Lift is helping small businesses in Austin use the financial tool.

In two cities, including Austin and New Orleans, 22 shops have raised $122,420 with 859 funders.

In East Austin Redbird Pilates raised more than $10,000 with 90 supporters.

Owners Elisabeth Kristof and Lee Valley say most of the supporters are neighbors.

"We raised a little over $10,000, which was really what launched us into expanding our studio," said Kristof.

Valley said, "It showed us how powerful community is and that is a founding principal that we have included in our philosophy."

Tribe Comics owner Eric Burke is using the same financial took to grow his shop in South Austin.

"It's all pretty much going back into the store for new fixtures, new slat wall, new space," said Burke.

In a little more than a week he has reached 30 percent of his goal.

"We still have 30 days left. We are up to $3,000," he said.

Burke explains crowdfunding is a way for him to steer clear of high interest loans.

He hopes for supporters it means keeping the places they love around.

"I don't think people would want to pay for their new McDonalds this way, but for local businesses people feel like this is part of their daily lives," said Burke.

Local Lift takes seven percent from each campaign. A spokesperson says they coach the businesses through the entire process to make sure they are successful.

For more information on the local campaigns, go to https://www.locallift.com/campaigns/Austin.

By Christie Post

Austin Businesses Turning To Crowdfunding


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