So Self-Starters Can Mean Business : Cottage industry: A Pasadena pilot program helps low-income residents turn ‘microenterprises’ into something bigger.

PASADENA —  No fancy signs or newspaper advertisements tell passers-by that inside the weathered two-story building on Painter Street is a businesswoman with a big idea.

Henrietta Samuels, 49, a seamstress, lives on the top floor in a cramped one-bedroom apartment she shares with her husband and two sons. Her workplace is a small bedroom table, where she sits day and night in front of a secondhand Singer.

She is one of many low-income residents in Pasadena and Altadena running “microenterprises”--everything from shops of organically grown herb to child-care services to leather goods boutiques--out of their homes.

Under a Pasadena-based pilot program, Samuels and 18 other self-starters will have a chance to turn their microenterprises into something bigger. They will be eligible for small loans to buy inventory and raw materials and to replace antiquated equipment.

The nonprofit Neighborhood Enterprise Center program also is creating networks through which entrepreneurs share advice for avoiding common pitfalls in operating a new business.

Before she left her native Jamaica in 1980, Samuels already was sewing for a living. She sold hand-tailored dresses and did alterations.

But after a decade of self-employment, the loan program marks Samuels’ first chance to borrow $1,000 for a new sewing machine.

“My desire, my biggest desire, is to go professional,” she said on a recent afternoon, inspecting the hem of a long-sleeved fuchsia and turquoise dress. “That’s why I came here, because I wanted to do designing.”

Founders of the Neighborhood Enterprise Center say the three-year program will draw its participants from distressed neighborhoods in northwest Pasadena and Altadena, where home-based businesses are seen as viable alternatives to minimum-wage jobs--but require starting capital.

Family Savings and Loan Assn. in Pasadena has agreed to provide low-interest loans ranging from $500 to $2,500, which will be distributed in a “peer-group lending system.” Under the system, participants are placed in groups of three to seven people. In each group, loans are doled out one at a time, and each recipient must pay back the loan before the next person receives any money.

The center, one of four nationwide, eventually will assist 50 entrepreneurs, mostly women and minority heads of households, over the three-year period, said Anita Jackson, the program’s development coordinator. Programs are already under way in Philadelphia, Jackson, Miss., and the Rosebud Indian Reservation in South Dakota.

“There are a number of people who make an effort and do not succeed based on their financial status,” said Jackson. “They simply do not have enough to operate a business successfully.”