LOWER EAST SIDE — Jonanthan Moyal understands small business.
The 23-year-old founder of new crowd-funding venture Lucky Ant grew up watching his self-employed father, a Moroccan immigrant, carve out a living in New York's textile industry.
Despite defeats, occasional victories and a lot of hard work, Moyal liked what he saw.
"It was never a question of whether I would start my own business," he said. "It was a matter of when."
That "when" turned out to be July 2011, when Moyal launched Lucky Ant, a business which helps other small businesses bankroll projects in non-traditional ways, with customers and fans investing directly in small amounts.
Lucky Ant is like a Lower East Side neighborhood hybrid of Groupon and Kickstarter, and has crowd-sourced $36,000 in total which has helped five local businesses with expansion projects to date.
"The problem [small business] are having is not necessarily getting customers," said Moyal, a 2010 University of Pennsylvania graduate in business and international studies. "The projects were the problem."
In the months since Lucky Ant launched it has helped the Lower East Side’s Cathcart & Reddy, formerly DessertTruck, re-brand itself as it moves products into stores. Grotto, a restaurant on Forsyth Street, is now building a courtyard covering so diners can be served during bad weather. Another current project involves assisting the Living Theater on Clinton Street with a $24,000 fundraising effort to keep its doors open.
"They [the small businesses] were able to go out to the community and their fans and ask for help," said Moyal. So far Lucky Ant has worked with mostly Lower East Side business and is now branching out to the East Village, West Village and Williamsburg.
Lucky Ant's operation is simple. Each week the public is pitched a new expansion idea by a local business on Lucky Ant's website, which includes a video profile of the owner and project.
Like Kickstarter, another Lower East Side-based company, people can respond to the request for finance. In the essence of Groupon, gifters are rewarded with a voucher according to what they gave, such as a product or service from the business. For example, those who gave $500 to Cathcart & Reddy's campaign received a dinner for eight people, giving Lucky Ant its Groupon flavor.
Once the set-funding goal is reach the business can undertake its desired project.
"I was so pleased," said Jerome Chang, 35, co-owner of Cathcart & Reddy, a four-year-old business with a strong local following. "We reached our goal in a couple of days."
Carthcart & Reddy started as DessertTruck, selling sweet treats on wheels as well as from a storefront on Clinton Street. However, the truck was hard work and Chang saw supermarket shelves as the future for his products, such as chocolate bread pudding. About $3,500 was needed to move forward.
"It allowed us to most obviously raise cash for the project, to hire a designer to design package goods," said Chang. Now the business is rebranding, and stickers for the packaged goods are being printed.
"For us to feel comfortable to spend over $3,000, it probably would have taken the rest of the summer [to raise],” he said. Gathering funds through Lucky Ant bumped the timeline forward six months, a large stride in the small business world.
While providing an unorthodox avenue of funding that bypasses complicated bank loans, Lucky Ant has also created a keyhole into how communities works. Moyal has so far seen three main reasons why people might be compelled to support a business through Lucky Ant.
"On a community level, those are the people who have given across projects," he said. The typical investor, according to Moyal, are those who have lived in the area for 20 to 30 years and who see strong locally operated businesses as a way of preserving the neighborhood they love.
Another investor category is the businesses fans.
"They are getting something in return," said Moyal. "They are going to benefit from having those desserts in the supermarket or having that tarp over the garden."
The third type of investment comes from those who want to be apart of the story, for the business they help finance and the community.
The importance of story is crucial to a successful campaign on Lucky Ant, according to Moyal. It also plays a role in what business he hand picks to work with.
"There is a sense of ownership that people want to buy into," said Moyal. Often each business has a story whether it is the patisserie owner who used to be a plumber or the lawyer that switched gears to follow his dream, he said.
"Everyone somehow has this story 'I was doing this job, but I didn't like it. I was following my dreams and I decided to do this'," said Moyal.
The "sexiness" of a project can also determine success.
"It is easier for us raise funds to get an ice cream maker than it is to get new plumbing," said Moyal.
As Lucky Ant directs funds to other enterprises, it is easy to forget it too is a business. With a strong family history of business ownership (Moyal's sister is also self-employed as a graphic designer), much of Lucky Ant's initial financing came from Moyal's family and friends.
In terms of profitability, Lucky Ant operates as a commission business, taking a slice out of the financing or adding on a charge depending on how much a project raises. At the moment this fee is negotiated with each individual business, but Moyal hopes to soon land on a percentage that will be applied to each project across the board.
In solidarity with the businesses it works with, Lucky Ant hasn't been without its own growing pains. A credit card processing issue effectively shut Lucky Ant down for about a month just a few weeks after it launched. Dispute this and other hiccups, Moyal's enthusiasm and vision is undeterred.
"It seems you are more responsible for what you do. That is what I like," said Moyal.
"If Lucky Ant fails or succeeds it was my call and there is no one else to blame or take credit for that."
