Heres what Dorothy Nelson knew.
She knew that her husband likely would lose his job in construction, an industry hard hit by the recession.
The Templeton resident knew they had two children to support, a 16-year-old son and 19-year-old daughter.
She also knew the family had a mortgage to pay and medical bills from her husbands two surgeries and daughters hospitalization for asthma.
And, finally, she knew that starting her own business was a huge risk.
Still, she took it.
Even before she found out that her own job teaching parenting classes through the Atascadero Unified School District would be eliminated this spring, she thought of a way to continue her passion and generate income to help support her family.
She applied in April for a $15,000 microloan from the Economic Vitality Corporation of San Luis Obispo County, and in mid-June, money in hand, Nelson launched Playtime Discoveries, a year-round parent-participation program for children 12 months to 6 years old.
Parents pay $150 and up for 18-week Mommy and Me sessions. She also offered $100-per-week summer camp sessions.
I was scared, but I felt like I had no other choice, said the 51-year-old Nelson. My credential in parenting is so specialized that I didnt think there would be any jobs for me.
The EVC, a private, nonprofit organization dedicated to strengthening the countys economy, has been a welcome resource for local residents forced to consider starting their own companies to make a living.
Over the past 13 years, it has guaranteed 84 loans and funded 67 small direct loans to San Luis Obispo County residents, worth approximately $8 million.
The organization does not ask loan applicants if they are unemployed, and so it does not have figures on the number of out-of-work clients it has served since the economic downturn began in 2007.
But Michael Manchak, president and CEO of the EVC, estimates that loan demand has doubled since the start of the recession.
Loans are given to aspiring entrepreneurs based on several criteria, including their experience in that type of business, what they have at risk and what theyre willing to do to make the business a success, said Dave Mooklar, the EVCs loan administrator. Applicants also must have a business plan, although it doesnt have to be an elaborate one, he said.
In Nelsons case, she sought the help of SCORE an organization that provides counseling services to entrepreneurs to develop her business plan.
Nelson, who operates the brightly colored center with no staff, acknowledges that, given the financial stress, she may have gone into the venture a little blindly.
But after working six years as a parent educator, she said she has the confidence, momentum and community support to make it work.
I built a reputation working in the district, and people already knew me, Nelson said. Im still Mrs. Dorothy, but now Im Playtime Discoveries Mrs. Dorothy.
Shes also motivated to succeed for the sake of her family, which already has had to make sacrifices because she started her own business.
Her daughter had been going to Butte College in Chico, but Nelson said they could not afford to send her back to that junior college. She now plans to go to Cuesta College and is working at a local retailer.
Nelsons son, who takes odd jobs to earn money, is trying to find a more permanent position. He understands what is at stake and doesnt ask for things, she said.
The family doesnt have cable television and doesnt go out to dinner or the movies anymore.
Weve always been a little on the frugal side, and so I think that helps, she said.
Nelson is breaking even now and hopes to generate enough business this fall to make a profit. Her husbands construction job in Capitola, where he has commuted for two years, will end in February. At that time, he will search for other work.
In the meantime, if classes do not fill at Playtime Discoveries, Nelson said she will offer other programs, such as sign language classes and Lamaze, to keep the business afloat. In recent weeks, she has booked her facility for birthday parties after a few parents inquired.
Failure is not an option, she said, especially since she was recently approved for more funds, a $35,000 Small Business Administration loan from Mission Community Bank. The loan paid off the $15,000 microloan from EVC.
But that new loan is at 7 percent and is a second mortgage on her home.
Nelson acknowledges the added pressure and said the family is operating on faith and optimism.
There is no plan B, she said. It never entered my mind that I wouldnt succeed.
About the EVC
Economic Vitality Corporation of San Luis Obispo County: 788-2012 and www.sloevc.org