Updated by Steward Team
What are ‘anchor lenders’?
Qualified lenders can participate in a Steward loan for as little as $100. While any level of participation will help fund a project and support a local farm or food business, most projects would require a lot of $100 lenders to fund a reasonable commercial loan.
That’s where anchor lenders come in. These are people who understand your business, are motivated by your mission, and have the financial capacity to contribute a significant amount to your loan. Depending on the total loan amount, they may contribute anywhere from $5,000 to $50,000, and will make up a sizable portion of your overall loan funding.
Why are anchor lenders important?
As Steward loans are funded by private individuals, there is often an element of social validation needed to motivate other lenders to participate. While people may believe in your mission and love what you’re doing, there is often hesitation to be the first in the pool so to speak. When anchor lenders participate in your loan, they are communicating to others that they have confidence in your business and are willing to back it financially. The progress of your campaign is always visible on your project page, so clearly seeing that other lenders are contributing creates momentum within the wider lender community to join in funding your loan to its goal.
For this reason, securing your anchor lenders should be the primary focus of your efforts during the private phase of your campaign.
Who should my anchor lenders be?
Anchor lenders are likely to be individuals, families, or organizations that:
- You have an existing, direct relationship with, or you can get a personal introduction to
- Understand your business and the market you operate in
- Have a high net worth and prior experience with finance or investing
- Are members of your community or have some connection to your area
These types of lenders are rarely sourced from social media posts or email newsletters (although it does happen!), so will require a more hands-on approach. Direct phone calls, emails, and in-person meetings are usually the best means to effectively explain this opportunity and gauge their willingness to participate.