Editor's note: This story is part of Southwest Michigan Second Wave's On the Ground Kalamazoo series.
Five thousand dollars in working capital comes in pretty handy when you own a small business.
It can be a lifeline when you’re struggling to grow a part-time, one-man operation into a full-time livelihood that can support a family of five.
That was the case when DeMargeo White received a Kalamazoo Micro-Enterprise Grant last year.
“It came at the right time,” the 30-year-old Kalamazoo resident says of the grant program, launched last year to provide crucial financial relief to micro-enterprises. Those are businesses with fewer than 10 employees and less than $1 million in annual revenues.
The grant was awarded after the COVID-19 pandemic hit and White found himself laid off from his full-time job. It was also at a time when his wife Sherita – with whom he has three young children – left her job at a local bank to go back to school.
“It was very beneficial,” says White, who was working as a chef at Kalamazoo College in March of 2020 when dozens of area businesses and institutions were shut down to limit the spread of COVID-19.
Huey D’s Goodies is named for the Whites’ son Houston (called Huey), 4, at right. They other children are Roman, 1, at left, and Serena, 8, center.
White is the owner of Huey D’s Goodies, a maker of gourmet cheesecakes and cupcakes that he started in April of 2019 as a part-time venture. The business, which uses the kitchen of the First Baptist Church in downtown Kalamazoo and delivers orders on demand, is named after White’s son Houston DeAndre White, now age 4. He is nicknamed Huey.
“I ended up using the money to buy more equipment,” the 11-year veteran of the food industry says. “I ended up getting my licensing taken care of. Money went toward the materials, the ingredients, and stuff, and then promoting and marketing – business cards, fliers, and things of that nature. So it was very beneficial. And it came at the right time.”
He says the grant helped him ramp up more quickly. Of Huey’s D’s Goodies, he says, “I was doing it part-time because I was working full-time. But when I got laid off from K-College, I hit the ground running full speed. I got my website
going and my mobile app.
White was one of 100 local business owners to receive a grant in last year’s Kalamazoo Micro-Enterprise Grant program. It is a result of a partnership between the City of Kalamazoo and the United Way of the Battle Creek and Kalamazoo Region, with support from Kalamazoo’s Foundation For Excellence. It was launched last year with a total of $500,000 in funding. That benefitted 100 businesses. This year’s program, which has $450,000 in funding, hopes to benefit 90 micro-businesses although more than 100 applied for help prior to a July 5 application deadline.
They will all be businesses that did not receive funding last year, says Natalie Saucedo, senior director of Strategy & Innovation at the United Way of the Battle Creek and Kalamazoo Region. To be eligible, they must be located in the city of Kalamazoo and have been in operation for at least one year.
“We had over 100 applicants come through,” Saucedo says of this year’s program. “We’re still in the process of doing our initial review to determine the eligibility of those businesses, validating business size, for example.”
Award determinations are to be made during the third week in July by a Small Business Cabinet, a volunteer group made up of business people and entrepreneurs as well as others involved in lending, economic development, law, and other fields. Grant awards are to be announced by the end of the month. Funds are to be received by business owners in early August. And the program hopes recipients will use the grants to leverage funding from other sources.
Cheesecake slices produced by Huey D’s Goodies are being sold at eight Kalamazoo-area locations.
“In general, grant funds are always going to be a need for small business owners and entrepreneurs,” Saucedo says. “So last year when we developed the fund it was obviously in response to COVID-19 and the crisis and just getting cash flow out into our community as quickly as possible. But during that process, we saw an overwhelming need.”
She said the program got a huge response and businesses kept asking about grant funds.
“In our community, we are pretty resource-rich,” she says. “But there’s not a ton of grant opportunities for small business owners that are offered each year.”
She says the grant program is an opportunity for the United Way, the city, and their partners to provide a financial resource to business owners who do not have access to traditional capital, such as a flexible line of credit from a bank, an investment partner or a well-heeled family member.
This year’s awards will also focus on providing support to micro-businesses whose owners are Black, indigenous, or other people of color (BIPOC), as well as women-owned businesses and those enterprises that help support local people who are living below the ALICE (Asset Limited Income Constrained and Employed) threshold. According to information provided by the United Way, BIPOC and women-owned businesses have struggled to access funding compared to other businesses, and they were especially hard hit by the economic fallout of the COVID-19 pandemic.
Through its application process, the program also hopes to better acquaint entrepreneurs with the processes involved in applying for grants. A lack of that awareness hindered many small businesses last year as COVID-relief assistance was offered from state and federal sources.
DeMargeo C. White, owner of Huey D’s Goodies, prepares 576 cupcakes recently for Portage dentist Dr. Kenneth W. Grabowski.
Saucedo says the pandemic put a lot of entrepreneurs in crisis mode last year. Loans and grants were being sought to provide businesses with immediate cash to help them pay such things as rent and meet their payroll obligations while they were closed for one or two months. This year’s grants are also likely to be used for one-time needs, but they will differ based on the type of business involved.
Saucedo says this year’s applicants include all kinds of enterprises. They include eateries, cosmetologists, professional services such as legal and accounting businesses, and catering services that don’t have their own full-time location.
“The financial impacts of COVID have not gone away,” she says. “So although they may be open and doing business right now, they still had an entire year where they were unable to do business as usual. … But I think what we saw more this year than we saw last year is requests for what we would call ordinary business expenses.”
She says that includes such things as the need to cover the cost to replace a core piece of equipment that has failed.
Chris Sargent, president and chief executive officer of United Way BCKR, says, “Our partnership with the City of Kalamazoo on KMEG (Kalamazoo Micro-Enterprise Grant) last year showed how we can make a powerful difference together for this vital business sector. We’re proud to collaborate again to benefit these businesses, the people who operate them, and the community they serve.”
White’s business has grown. He says his cheesecake slices are being sold at eight area stores and he continues to receive orders for gourmet cheesecakes and cupcakes from businesses and individuals. His treats appeal to families, coffee lovers, working people, and others, he says. And they are promoted at local events as well as on the Huey D’s Goodies Facebook page.
Although the pandemic caused him to lose a steady job, White says, “COVID-19 got me motivated. When I hit the ground running, the business pretty much took off because I was more consistent with everything. … I started working from home. That summer, in June of 2020, I did 60 cheesecakes out of my house.”
That was compared to selling less than 10 per month at other times, he says.
What was the largest order he has had to fill?
Natalie Saucedo is Senior Director of Strategy & Innovation at United Way of the Battle Creek and Kalamazoo Region.
“As far as whole cheesecakes, it was nine at one time.” He says. “It was in Wayland. It was last year in the summer. A worker, he had ordered some and his friends had put in an order. ... They distributed them (the cheesecakes) among their friends who wanted them.”
He says he filled an order a few weeks ago for 160 cupcakes for a Kalamazoo College event involving its 2021 graduating class. He says he hopes to get more business from his former employer, even though they did not call him back to work from being laid off.
“The biggest cupcake order I’ve had was 576 cupcakes back in April of this year,” White says. “They went to a dentist’s office out in Portage (Dr. Kenneth Grabowski). But they pretty much just ordered them. And they took them to different offices and just dropped them off to people (clients and customers).”
“The grant definitely helped me buy more equipment and get things set up as far as business insurance for the business, getting my license through the state, my LLC (limited liability corporation), all that stuff,” he says.
An Oreo Cookies N Cream cheesecake by Huey D’s Goodies.
He hopes to be able to hire help, too.
“Right now, the business is expanding,” White says. “I’m transitioning the business from doing slices, where people can come down and buy them down at the church (First Baptist Church at 315 E. Michigan Ave.), to focusing on wholesale and online orders.”
His products can now be purchased at eight retail locations in the Kalamazoo area, with another location soon to be added. Those locations include: Saugatuck Brewing Kalamazoo
; Market on Michigan Ave
; La Familia cafe
; Hilton Garden Inn Kalamazoo Downtown
; Ty’s Joint
; Twine Urban Winery-by The Roche' Collection
; Burger Bros; and ChocolaTea.
More information is available on the Huey D’s Goodies Facebook page
“The business is definitely growing,” White says. “I have wedding venues reach out to me about being their vendor. I’m actually doing cupcakes for the Black Arts Festival (last weekend). It’s definitely getting notoriety.”