As a national nonprofit loan fund considers investing in an online book marketplace, what risks should be considered and how might they be mitigated?
As a national nonprofit loan fund considers investing in an online book marketplace, what risks should be considered and how might they be mitigated?
Partners for the Common Good (PCG), a US Department of Treasury certified community development financial institution, had received a loan request from First Book Marketplace (FBM), an organization which sold books at discounted prices to community programs serving low-income children. While PCG was impressed with FBM's mission, FBM needed to demonstrate it could operate successfully and repay the loan. In this case students examine FBM's loan application, from the perspective of an underwriter and loan committee member, to determine how to mitigate risks through loan terms.