In the large front window of Dolly’s Boutique and Consignment, on Germantown Avenue in Mt. Airy, three mannequins in vibrantly printed dresses showcase a few summer pieces that Shani Newton––the boutique’s owner and Mt. Airy native––has selected. Inside, light fixtures that resemble bouquets of white daisies hang from the ceiling above dark hardwood floors and walls decorated with a black and white floral wallpaper. Amidst the racks of clothes for women of all ages and sizes, are tables with hats and jewelry, and a comfortable black chair for lounging. 

“It’s a place where women can come to not only shop,” says Newton, “but to network, socialize and connect.”

Indeed, Dolly’s has become a gathering place for women in the neighborhood, hosting community events like book signings and parties to support local designers and entrepreneurs. This year, Newton’s 10th anniversary, she’ll open a second location as one of the few local shops at the new Fashion District of Philadelphia (the old Gallery), and will employ 11 people, including seven on Market Street.

“We wanted to leverage the dollars we were giving away, not just to help individuals, but to help business communities grow,” Hotaling says. 

It’s a far cry from where Newton was, about six years ago, when she was fighting just to keep her business alive. At that time, the look of the former thrift store that had become Dolly’s Boutique “was old and drab,” in contrast to the new fashions she was trying to sell. People weren’t coming through her door; she had not yet hired any employees. Newton had planned to do renovations by her fourth year, but was barely breaking even. She knew she needed help.

In 2013, the Mt. Airy Business Association introduced Newton to The Merchants Fund, a 165-year-old charity with a $15 million endowment that gives $10,000 grants to small businesses in Philadelphia facing financial hardship. The grant allowed Newton to redecorate—including installing a bright new front window—and to implement a point of sale system to straighten out the boutique’s finances, which had become overwhelming. It was, Newton says, as though she’d opened a whole new store in place of her old business—and the customers started pouring in.

“The Merchants Fund changed my business,” says Newton. “They gave me a new life.”

Newton’s story is all too familiar to small business owners. According to the Bureau of Labor Statistics, about 20 percent of small businesses fail in their first year; 30 percent fail in their second year; 50 percent fail after five years; and 70 percent fail in their first 10 years.

That’s why, since 2007, The Merchants Bank has given over $4 million to over 400 small businesses all across the city. Last year, the organization gave 37 grants; the highest was 57 in 2014. Those businesses used the money for everything from cosmetic changes like Dolly’s, to unexpected moves, to new technology or changes to staff. Often, it was just the help needed to keep going.

“I understand what it means to take the plunge, to put everything on the line, to put your house up as collateral. I understand what it means when things don’t go as planned. But I also know what it’s like to have an organization like The Merchants Fund that you can go and ask for help from,” Fink says.

The Merchants Fund dates back to the mid-1800s, when a group of businessmen in Philadelphia formed the Mercantile Beneficial Association, a self-insurance organization that they  could pay into for $3 a year. Should anything happen to their businesses, the Association would support them financially. In November, 1842, the Mercantile Beneficial Association had its  first annual member’s meeting after six months of operation, with 92 members. The next year, there were 364 members.

Around 1854, The Mercantile Beneficial Association created a fund to support merchants who wanted to retire––a challenge for small business owners even today. The idea was to build a home in Philadelphia where retired merchants and their families could live after retirement. (It is unclear whether this ever happened.) From this kernel, however, The Merchants Fund emerged, no longer as a self-insurance organization, but as a charity for “indigent” merchants––as per the organization’s original charter––who were retired or couldn’t work. For more than a century and a half after its founding, The Merchants Fund wrote stipends for as much as $700 a month to over 150 merchants who were retired or couldn’t work.

“In the old days, everybody who was involved in the Mercantile was from Philadelphia,” says Bruce Hotaling, chair of The Merchants Fund’s Board, who became involved with the organization in the mid-90’s. “They were looking to benefit people from Philadelphia.” By the 1940s, however,  the leaders of The Merchants Fund began buying houses on the Main Line. “Suddenly all the people that were involved didn’t live in the city any more,” says Hotaling. “They really became detached from everything that was happening in the city, and who they could best serve. It became very transactional.”

With the turn of the 21st  Century, Hotaling says The Merchants Fund began working to reaffirm the organization as one by Philadelphians, for Philadelphians. In 2007, they stopped giving stipends to new retirees––but they still give to 14 retirees who received them prior to 2007––and began instead giving $10,000 grants to active small business owners, like Newton. “We wanted to leverage the dollars we were giving away, not just to help individuals, but to help business communities grow,” Hotaling says. 

Each year, The Merchants Fund receives around 100 applications for grants; of those, 30 or so won’t meet the eligibility criteria, which mandates that a business owner relies on their business as a primary source of income and that a business be in operation for at least three years. The application takes anywhere from 30 minutes to an hour to complete, and includes questions like: “How will you use a grant?” “How will a grant stabilize your business?” “How is your business important to your community?” “What will you do if you do not receive a grant?” It is intentionally simple, and executive director Jill Fink says that TMF, being sensitive to technology access issues, often invites small business owners to their office on Walnut Street (soon to be on the JFK Blvd.) to help fill it out.

After the applications are received, Fink and a 12-person board, comprised almost entirely of people who live in the city of Philadelphia, decide which businesses will receive grants. (To avoid recipients having to pay taxes on the grant, The Merchants Fund pays the contractor who is doing maintenance at a business buys the equipment directly.) This entire process happens annually, and is sometimes done twice a year, depending on the organization’s endowment or if The Merchants Fund is focusing on a specific project. 

“For me, it’s about building wealth in communities. Small businesses are the backbone of this country,” Fink says.

Recipients are varied, and diverse: Mt. Airy Violins and Bows, which offers custom crafted bows and string instruments only a few blocks away from Newton’s store, received a grant in 2016. Fond, a contemporary American restaurant in East Passyunk received a grant in 2012. Fink, before starting at TMF only a few months ago, was herself a grantee as the owner of Mugshots Coffeehouse, which had locations in both Fairmount and Manayunk. In 2008, Fink applied for a grant to expand the Fairmount location; shortly thereafter, she received another grant to build out an online platform for the Manayunk location’s market of local, farm-grown products. Then, TMF’s executive director at the time asked if Fink would help mentor other businesses that were applying for grants. In 2013 she became the first grantee to join TMF’s board (there are now several grantees on the board).

“I think, having been a small business owner, allows me to work with small businesses in a different way,” says Fink. “I understand what it means to take the plunge, to put everything on the line, to put your house up as collateral. I understand what it means when things don’t go as planned. But I also know what it’s like to have an organization like The Merchants Fund that you can go and ask for help from.” Now she’s extending the hand that was once extended to her. And she wants to reach into neighborhoods where small businesses haven’t always been supported. 

A couple years ago, after a group of students at Penn mapped where TMF had been giving grants, they noticed that there were clusters in neighborhoods, like Manayunk, East Passyunk, Mt. Airy, where The Merchants Fund had previously given grants. Fink calls this the ripple effect: A business receives a grant and tells a neighboring business, who then applies. This helped business rows in those neighborhoods improve over the years. But the map showed that a shadow had been cast on the business communities in neighborhoods like North Philly. 

In response, TMF launched “Place-Based Initiative,” as a project that commits a certain portion of The Merchants Fund’s annual grant-giving budget of around $450,000 to a specific community. Fink says that TMF is working to identify small commercial corridors in high need areas, like North Philly, where says there aren’t as many business associations or organizations that help support the many small businesses in the community. Fink’s vision for “Place-Based Initiative” is then to work with that small business corridor over a period of three to five years. 

The goal, Fink says, is not to just help a few businesses—although that in itself is a way to help Philadelphia succeed. “For me, it’s about building wealth in communities. Small businesses are the backbone of this country,” she says. “How do we make sure that they aren’t living in poverty? That they have an asset that they can pass onto the next generation? Or that they are making enough so that the next generation can do something else?”