Seen here in his office, Ruben Alonso III is the president of Kansas City-based AltCap, which gives microloans to artists through its ARTCap fund. (photo by Jim Barcus)
When fine art photographer John Lamberton put on his “Extrasensory” exhibition at the Leedy-Voulkos Art Center last year, a publicity release said he “fires a warning shot challenging the status quo.”
At the same time, Lamberton challenged the status quo of how entrepreneurial artists obtain money. He took out a $7,000 loan from ARTcap, a microloan fund for Kansas City artists, to finance production and marketing costs for his show.
ARTcap was launched a few years ago with help from the Kansas City Office of Culture and Creative Services. It is part of AltCap, a mission-driven community development financial institution (CDFI) that provides alternative capital to small businesses and development projects.
“We see artists as creative people, but we also see them as entrepreneurs,” said AltCap President Ruben Alonso III. “They may be a musician, a photographer or a ceramics maker. They’re passionate about what they do, but a lot of them are also trying to make a business out of that as well. We want to help fund that passion and allow them to grow and contribute to the economic benefit of having a thriving arts community.”
Lamberton, who retired in 2015 from his post as senior collections photographer for the Nelson-Atkins, learned about the microloan program from a Kansas City Artists Coalition “boot camp” on art-related legal issues in April 2017.
“This is a business,” he said. “When you’re starting out, you’re trying to introduce yourself. You want to make sure it’s done in a professional manner so that it will be well received. Having worked at the Nelson a dozen years, I saw how that’s done.”
Megan Crook, community development and outreach manager for AltCap, said artists usually don’t seek out loans to help grow their businesses. “We’re trying to change that mentality. Our loan fund is available to artists of all disciplines.”
Alonso said ARTcap wants to raise awareness of its loan program “and how it can be an alternative to an artist spending a lot of time trying to pursue grants or going into credit card debt. We’re a much better alternative.”
Funding sources for ARTcap include federal tax credit financing, the Community Development Financial Institutions Fund and the Ewing Marion Kauffman Foundation. Kansas City artists have received 10 ArtCap loans, all for less than $10,000, since the program began.
ARTcap loans are flexible in terms of collateral requirements, Alonso said. “It could be the equipment you’re going to buy with that loan. It could be a car, or some other personal asset or business asset.”
Alonso said one potential borrower had recently offered bitcoin — digital or virtual currency that uses peer-to-peer technology to facilitate instant payments — as collateral on an ARTcap loan. He said bitcoin does not yet qualify as ARTcap loan collateral, “but I think we’re probably going to have to reconsider that, because I think it’s going to be a lot more common to be offered this type of nontraditional collateral.”
Lamberton put up his 2006 Infinity G35 car as collateral for his ARTcap loan, which runs for three years at a 10 percent annual interest rate. He also provided information about what he wanted the loan for, and a budget.
The sales garnered from his Leedy-Voulkos exhibition did not cover the entire amount of the loan, but Lamberton said he’s very happy with the recognition the show generated. For example, he said the exhibition led to Weinberger Fine Art representing his work.
He said the show also boosted traffic on his website, where most of his sales originate. He said the site has been drawing hits from locales such as France, Taiwan, India, North Carolina, Washington, D.C. and the Flint Hills.
“I called my show Extrasensory,” said Lamberton, who enjoys discussing quantum physics. “People search on that word all over the world, and they come to me because of that. None of that would have happened unless I had had that show at Leedy-Voulkos.”
Lamberton likes the fact that he has established a track record with ARTcap. “I’d rather develop a relationship with a lending institution lending to artists,” he said. “They were very accessible. You can have all the ideas in the world, but if you don’t have a way of making them happen, they won’t. ARTcap provided an opportunity to jumpstart my career.”
ARTcap up until now has funded artists who live or work in Kansas City, Missouri. At press time it was working on plans for additional funding that will enable it to expand across the state line.
“We see demand on the Kansas side for an organization to provide this kind of nontraditional financing,” Alonso said.
