Rebirth Financial, an interesting social lending site for small businesses, was created by two Tulane MBA candidates. It began when Ghonchol Gupta spent his summer internship working on economic development in New Orleans and faced great challenges finding banks to provide credit to small firms. From Alison Damast at BusinessWeek:

He pondered the problem, talking it over one summer evening with his friend and fellow MBA Xavier Cabo at Bruno’s Tavern, a popular student hangout. Over beers, the two tried to come up with a way to make credit available to small businesses. By the end of the evening, they’d devised an idea for a peer-to-peer lending system, like The Lending Club or Prosper. But their system would focus on giving loans to small business, rather than individuals. “That was our ‘aha’ moment,” Gupta says.

When they returned to school in the fall of 2009, Gupta and Cabo got to work developing a business plan for the company, which they dubbed Rebirth Financial. They planned to set up an online platform where borrowers—small business owners—could put up a listing that described their business and ask for a loan they’d use to help their business grow. Individuals or institutional investors could then log onto the website, review the loan requests, and decide if they wanted to fund the small business.

Gupta and Cabo talked with James Biteman, a management professor at Freeman, and Georgios Bakamitsos, an assistant marketing professor, who helped them iron out the details of their business plan and gave them advice on how to launch the company. The professors also encouraged the budding entrepreneurs to enter business competitions. So that winter Gupta and Cabo entered the Federal Reserve’s Investor Idol competition. They came out as finalists, named one of the top four companies in the competition with the potential to change the U.S. financial system.

The story is interesting on many levels and worth reading.

via B-School Startups: A New Lending Option in NOLA – BusinessWeek.