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Elizabeth Franks, CEO of VBV, had a week until her July 2010 board meeting. VBV had just completed a six-month marketing and advertising campaign for a new product line and strategic rebranding, and early responses from the board had indicated mixed feelings.

Marjorie Burnett knew she was taking a gamble and wondered whether the potential new business she was considering would be worth the investment. Was expansion-offering even more products-the answer to increasing revenue, and would that decision be more profitable than her present business?

A managing partner of Pacific Community Ventures, a San Francisco-based private equity fund, had until the end of the week to decide if he wanted to invest in Galaxy Desserts, a Bay Area manufacturer of premium baked goods. PCV was a private equity firm that took a "double-bottom-line" approach, a two-pronged objective of delivering both financial and social returns.

This case is designed to illustrate the methods that small-business lenders use to evaluate the creditworthiness of potential commercial borrowers. It is set in South Central Los Angeles, the commercial loan officer is of Mexican descent, and the potential borrowers are Mexican immigrants. The unique setting allows students to evaluate the creditworthiness of the borrower, while discussing many of the nonfinancial considerations that accompany the lending process. The case explores several issues, including immigration, urban development, and the challenges facing mainstream banks trying to expand into new markets.