Financing
Starting or growing a business takes money. It can be difficult for business owners to know where to begin.
While the SBDC does not administer loan or grant programs, we help businesses assess and identify funding options and opportunities, and prepare documentation that lenders require. Our consultants have in-depth knowledge about loan programs and what lenders really need from borrowers to make a loan.
Small Business Administration
Banks and other lending institutions offer a number of SBA guaranteed loan programs to assist small businesses. While SBA itself does not make loans,
it does guarantee loans made to small businesses by private and other institutions.
View Small Business Administration Loan Programs
SBA Guaranteed Loan Programs:
7(a) Loan Program:
This is SBA’s primary and most flexible loan program, with financing guaranteed for a variety of general business purposes. It is designed for start-up and existing small businesses, and is delivered through commercial lending institutions.
The major types of 7(a) loans are:
CDC/504 Loan Program
This program provides long-term, fixed-rate financing to acquire fixed assets (such as real estate or equipment) for expansion or modernization. It is designed for small businesses requiring “brick and mortar” financing, and is delivered by CDCs (Certified Development Companies)—private, non-profit corporations set up to contribute to the economic development of their communities.
Microloan Program:
This program provides small (up to $35,000) short-term loans for working capital or the purchase of inventory, supplies, furniture, fixtures, machinery and/or equipment. It is designed for small businesses and not-for-profit child-care centers needing small-scale financing and technical assistance for start-up or expansion, and is delivered through specially designated intermediary lenders (nonprofit organizations with experience in lending and technical assistance).
Disaster Assistance Loan Program:
This program provides low-interest loans to homeowners, renters, businesses of all sizes and most private non-profit organizations to repair or replace real estate, personal property, machinery and equipment, inventory and business assets that have been damaged or destroyed in a declared disaster.
Region Nine Development Commission
Region Nine Development Commission takes great pride in working with and on behalf of counties, cities, townships and schools throughout south central Minnesota. Since 1972, being a partner for progress has led to the development of programs and identification of solutions in the areas of aging, economic development, business development, healthy communities, transportation, community development, and leveraging regional resources.
View Region Nine Development Commission Revolving Loan Funds
Southern Minnesota Initiative Foundation
Southern Minnesota Initiative Foundation has made biobusiness its highest business priority. Accordingly, solid proposals will be prioritized in all business evaluations.
View Southern Minnesota Initiative Foundation Loan Programs
BioBusiness Bio Seed Fund
Supports start-up stage biobusinesses that need capital, business expertise, and networking opportunities. Funding up to $25,000.
BioBusiness Revolving Loan Program
In partnership with local lenders and government agencies, this loan program is used to “fill the gap” between available and necessary financing. Loans of up to $200,000 available and may not exceed 50 percent of hte project cost.
Entrepreneurs Small Enterprise Loan Program
Available to start or expand a manufacturing, retail or service business within the 20-county region. Loans of up to $35,000.
USDA Loan Programs
The USDA Rural Development is committed to helping improve the economy and quality of life in rural America.
- Business and Industry Guaranteed Loan (B&I) Program
- Intermediary Relending Program (IRP)
- Rural Business Enterprise Grant (RBEG) Program
- Rural Economic Development Loan and Grant (REDLG)
- Biorefinery Assistance Program Biorefinery Assistance Loan Guarantees (BIOREFINERY)
- Bioenergy Program for Advanced Biofuels
- Repowering Assistance Program
- Rural Energy for America Program/Energy Audit and Renewable Energy Development Assistant (REAP/EA & REDA)
- Rural Energy for America Program/Renewable Energy Systems/Energy Efficiency Improvement Program (REAP/RES/EEI)
- Rural Energy for America Program/Feasibility (REAP/FEASIBILITY)
- Rural Energy for America Program Guranteed Loan Program (REAP LOAN)
- Farmbill Initiatives – REAP
Veterans Programs
Minnesota Reservist and Veteran Business Loan Program
Local Revolving Loan Funds
Your city, county or area Economic Development Authority may offer revolving loan funds (RLF) for business development projects such as business start-up and expansion. Often, they are used to fill a financing gap in a business development project. Eligibility and terms will vary with each fund.
Grants
You may have heard that there are grants available for people who would like to start a business. While this is true, most grants are offered to very specific organizations, usually nonprofits who have similar missions as the granting agency. Moreover, while some grant programs may be available to small businesses, most of these grants do not have funding available, or very limited funding available. Be sure to check with the granting agency to determine availability of funds for specific grants prior to applying for the grant. At this time the SBDC does not have access to any grant dollars to assist for-profit businesses.
