Small business funding, in the form of federal grants and loans, is available for these who are looking to expand or to start up their work. Indeed, all of the free grants come actually through the state government and not directly from the federal one. There are many different state agencies and organizations that are partners with the small business association (SBA) and they can provide you with different federal grant money programs.
Where should you start?
The first organization you should approach is your state government as they will be able to direct you to the different agencies and organizations that partner with the US small business association. You can find various funding options from your special district governments, the city or town government, and your state government. There are also public and private organizations that offer small business funding.
Can anyone apply there?
To apply for a small business grants and loans, you must meet the standard sizes that include 100 employees for the whole industries, 28.5 million for general and heavy construction industries, 6 million for service and retail industries, and 0.75 million for industries in agriculture. Almost all governments use these size standards for small businesses.
So, what is your homework now?
There are 4 main funding options available, which are the microloan, basic 7(a) loan guaranty, 8(a) program, and the CDC or certified development company program. These options are actually provided through companies, institutions, and lenders that are partnered with the SBA as the SBA does not award the money directly.
A very flexible loan that can be used for many general purposes is the Basic 7(a). This program is the first one you should try to apply for a small business funding. It can be tailored specifically to your needs as there are many different variations in this choice.
A CDC loan was made for developing the economy within a community and is provided to the community by nonprofit organizations. You need to apply to your regional CDC office as there are specific CDC’s depending on your location. A microloan has a maximum cap of $35,000 and it is dedicated only for small businesses and non-profit-child-care centers. This micro loan is supposed to be used specifically for inventory, fixtures, equipment, furniture and other business supplies.