The Complete Guide To Home Equity Loans For Business Purposes

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Maryland Small Business Loans

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The Best Business Loan And Financing Resources For Arkansas Small Businesses

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Eat, Drink, And Be Merry: Liquor Liability Insurance Explained

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The Best Business Loan And Financing Resources For Massachusetts Small Businesses

In 2018, Massachusetts was the fastest-growing state in the Northeast, with its population growing by over 5%. As its population grows, so does the state’s economy. Once known for agriculture, trade, and fishing, this state has grown to become a global leader in finance, biotechnology, and other modern industries. Massachusetts has even been named by as the most innovative state by Bloomberg.

With a strong economy and new opportunities always on the horizon, there’s no better time than now to launch or expand your own small business. Whether you’re the owner of an established business or you’ve only flirted with the idea of entrepreneurship, the state of Massachusetts has small business financing and resources available to you.

If you’re ready to launch your business or take your existing business to the next level, keep reading! Instead of poring through hundreds of small business lenders and resources, we’ve handpicked the best options for you. Whether you’re seeking low-interest loans, fast financing, or free business tools, this guide has you covered. Read on to find out more about the small business resources available to Bay Staters.

Online Business Lenders For Massachusetts Businesses

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Running your own business keeps your schedule full. When you need extra capital for your business, it seems like there aren’t enough hours in the day to head to your local lender. Fortunately, there is a solution that allows you to get the financing you need without spending hours at the bank. That solution is to work with an online business lender.

Through online lenders, you can apply for your loan, submit documentation, and even receive funds all without ever leaving your office. With online lending, you have more choices than ever and many online lenders also have less stringent requirements than traditional lenders. This means that you can access capital even if you have credit score challenges, haven’t been in business for long, or don’t meet typical revenue requirements.

On the one hand, having so many lenders to choose from is great because you can shop around your options. On the other hand, knowing where to even start can be a challenge. Instead of scouring the internet alone, check out what these online lenders have to offer.

SmartBiz

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You don’t have to go to your local bank to get a low-interest, long-term loan. Small Business Administration loans not only have competitive interest rates but are also easier to qualify for than traditional business financing. While you can visit a lender in person to apply for an SBA loan, smart business owners know that SmartBiz is the way to go.

SmartBiz is an online marketplace that has helped small business owners receive more than $1 billion via SBA loan programs. Through SmartBiz, you may qualify for a loan is as little as 5 minutes and receive your funding in just 7 days. The application process is streamlined so you can get the funding you need as quickly and easily as possible.

There are two loan products to consider. The first option is SmartBiz’s SBA Working Capital and Debt Refinancing Loans. These loans can be used to refinance business debt, expand your business, pay for a marketing campaign, hire employees, purchase equipment, or increase your inventory.

Through this program, you could receive $30,000 to $350,000. Interest rates are 8.25% to 9.25% with repayment terms up to 10 years.

To qualify for this loan, you must meet these requirements:

  • U.S. citizen or permanent resident
  • At least 2 years in business
  • Personal credit score of 640 or above
  • Sufficient cash flow for loan payments
  • No bankruptcies or foreclosures in the last 3 years
  • No defaults on government-backed loans
  • No outstanding tax liens

The second SBA loan program available through SmartBiz is the SBA 7(a) Commercial Real Estate Loan. With this loan, you can receive between $500,000 to $5 million to purchase commercial real estate or refinance your existing commercial mortgage. Interest rates are 7% to 8.25% with repayment terms up to 25 years.

The following are the requirements for receiving this loan:

  • U.S. citizen or permanent resident
  • Property must be at least 51% owner-occupied
  • Purchase price must be greater than $500,000
  • No new construction or investment properties
  • At least 3 years in business
  • Personal credit score of 675 or above
  • No bankruptcies or foreclosures in the last 3 years
  • No defaults on government-backed loans
  • No outstanding tax liens

If an SBA loan doesn’t seem like the right option for you at this time, you can also apply for a bank term loan from one of SmartBiz’s lending partners. You may qualify for $30,000 to $200,000 with repayment terms up to 5 years and fixed interest rates starting at 6.99%.

Lendio

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No time to send out applications to multiple lenders? Give Lendio a try. With Lendio, you can get offers from multiple lenders through just one application. Lendio is a loan aggregator that has partnered with over 75 lenders, making it easier than ever to compare your financing options.

Through Lendio, you can apply for nearly any type of business financing, including:

  • SBA Loans: $50,000 to $5 million
  • Term Loans: $5,000 to $2 million
  • Short-Term Loans: $2,500 to $500,000
  • Lines Of Credit: $1,000 to $500,000
  • Equipment Financing: $5,000 to $5 million
  • Startup Loans: $500 to $750,000
  • Accounts Receivable Financing: Up to 80% of receivables
  • Commercial Mortgages: $250,000 to $5 million
  • Business Credit Cards: $1,000 to $500,000
  • Merchant Cash Advances: $5,000 to $200,000

Rates, terms, and requirements vary by product and lender. Time to funding also varies, but some products are available in as little as 24 hours. There is no obligation to accept an offer, and receiving your offers will not impact your credit.

Unsure of which business loan is best for you? Learn more about the different types of small business loans.

OnDeck

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OnDeck has provided $10 billion to businesses around the world, and you could be the next business to get the capital you need. Through OnDeck, you can apply for one of two financing options: term loans and lines of credit.

A term loan provides you with a lump sum of capital in amounts up to $500,000. Short-term loan options come with 3- to 12-month terms and are best for purchases that deliver an immediate return on investment, such inventory or a new marketing campaign. The long-term option gives you 15 to 36 months to repay your loan and is best for larger purchases such as expanding your business or buying equipment.

OnDeck’s short-term loans have simple interest rates starting at 9%. This is the total amount of interest you will pay and is a percentage of your borrowing amount. Long-term loans have a 9.99% annual interest rate. OnDeck also charges an origination fee of 0% to 4% of your loan amount for short- and long-term loans. Payments are made daily or weekly and are automatically deducted from your checking account.

To receive a small business loan from OnDeck, you must have:

  • Time in business of at least 1 year
  • At least $100,000 in annual revenue
  • Personal credit score of 600 or above

If you need a more flexible financing option, consider applying for an OnDeck line of credit. You can receive up to $100,000 to cover unexpected expenses, make up for gaps in income, or for any business purpose. Rates start at 13.99% and payments are automatically deducted from your checking account each week. A $20 monthly maintenance fee will also be applied, but the lender will waive the fee for 6 months if you draw at least $5,000 within 5 days of opening your account.

To qualify for this option, you must have:

  • Time in business of at least 1 year
  • At least $100,000 in annual revenue
  • Personal credit score of 600 or above

Fundbox

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What do you do if your business is performing well, but you don’t have an excellent credit score? There are options open to you, including a line of credit from Fundbox.

Fundbox bases its approval decision on the performance of your business, so you don’t have to have perfect credit to qualify. Through Fundbox, you may be eligible to receive a revolving line of credit with limits up to $100,000. You’ll repay the lender over a period of 12 or 24 weeks. Fees start at just 4.66% of the draw amount.

If you don’t use your line of credit, you won’t pay a dime. If you do make a draw, you can pay your balance off early and save since Fundbox waives all remaining fees. Payments are automatically deducted from your business checking account each week. As you pay down your balance, funds will become available for you to use whenever you need them.

To qualify for a Fundbox line of credit, you must have:

  • A U.S.-based business
  • At least $50,000 in annual revenue
  • A business checking account
  • At least 3 months of transactions in a business banking account OR at least 2 months of activity in supported accounting software

BlueVine

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If you’re seeking a higher limit for a line of credit, you can receive up to $250,000 through BlueVine. Rates start at 4.8% for the most creditworthy borrowers. There are no fees if you don’t use your line of credit. Repayments are made on a monthly or weekly schedule over 6 to 12 months.

To qualify for BlueVine’s line of credit, you must have:

  • Personal credit score of 600 or above
  • Time in business of at least 6 months
  • At least $100,000 in annual revenue

If unpaid invoices are causing your cash woes, BlueVine offers an invoice factoring service that could provide you with up to $5 million. You can receive up to 90% of the balance of your unpaid invoices up front. Then, once the customer pays the invoice, you’ll receive the remaining balance, minus fees. Fees start at 0.25% per week.

To qualify for invoice factoring, you must be a B2B business that meets these requirements:

  • Personal credit score of 530 or above
  • Time in business of at least 3 months
  • At least $100,000 in annual revenue

Amex Business Loans

American Express OptBlue

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Worried that applying for financing will harm your credit score? If you’re an American Express cardholder, there may be an option available for you that has no impact to your credit score.

American Express Business Loans provide you with $3,500 to $50,000 in capital for your small business. You can repay your loan over 12, 24, or 36 months. These loans come with fixed APRs of 6.98% to 19.97%.

This offer is available only to select American Express Business cardholders. By logging into your Amex account, you can find out if you’ve been preapproved. This preapproval will provide the maximum borrowing amount and your maximum rate. After providing some information about your business, you could receive your funds in as little as 3 business days if you’re approved.

Because American Express uses the information it has on file for you, there’s no impact to your credit to apply. To qualify, you must meet these requirements:

  • Hold a Basic Card or Business Card
  • Be in good standing with American Express
  • U.S. citizen or permanent resident
  • Be at least 18 years old

Amex Merchant Financing

American Express OptBlue

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If you don’t qualify for American Express Business Loans, you may be able to get the capital your business needs through Amex Merchant Financing. If your business accepts American Express cards, you could qualify for this funding option.

Amex Merchant Financing provides $5,000 to $2 million to qualified business owners. Repayments are made over 6, 12, or 24 months. You’ll pay one fixed fee of 1.75% to 20% to take advantage of Amex Merchant Financing. Repay early and you can receive a rebate of up to 25% of your fixed fee.

Daily payments are automatically deducted to pay off the lender. You can opt to have a fixed amount taken from your business bank account, or you can choose to get a percentage of your daily receivables withdrawn.

To qualify for Amex Merchant Financing, you must have:

  • A business that accepts American Express cards
  • At least $50,000 in annual revenue
  • At least $12,000 in annual debit and credit receivables
  • Time in business of at least 24 months

Upstart

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Many of the previous options listed require at least a few months in business, but what do you do if you’re looking for capital to launch your business? Time in business requirements could bar you from receiving small business financing. However, you could qualify for a personal loan to use for business expenses.

Because this isn’t a business loan, time in business, annual revenue, and business credit history aren’t considered. Instead, your personal credit score and annual income are used to qualify you for a loan through a lender such as Upstart.

Upstart offers qualified borrowers $1,000 to $50,000. These funds can be used to fund your startup costs or cover other business expenses. Upstart’s APRs range from 7.54% to 35.99% based on creditworthiness. Repayment terms are 36 to 60 months.

To qualify for an Upstart loan, you must:

  • Be a U.S. citizen or permanent resident
  • Be at least 18 years old
  • Have a valid email account and a verifiable name, date of birth, and SSN
  • Have a source of income
  • Have a personal bank account
  • Have a personal credit score of at least 620

In addition to your credit score, Upstart will consider other factors of your personal credit profile. Additional qualifying requirements include:

  • No bankruptcies or public records
  • No delinquent account
  • Less than 6 inquiries over the last 6 months
  • Solid debt-to-income ratio

Banks, Credit Unions, & Nonprofit Lenders In Massachusetts

While online lenders make borrowing easier and more convenient than ever, you may still prefer to go the traditional route with a local bank, credit union, or nonprofit lender. If you haven’t already established a relationship with a local institution, consider one of these lenders that serve small business owners in Massachusetts.

Eastern Bank

Eastern Bank was founded in 1818 and has its headquarters in Boston. Today, there are over 120 locations throughout Massachusetts and New Hampshire in cities including Boston, Burlington, Reading, and Lowell.

Eastern Bank offers multiple financial services for small business owners. The institution not only offers business checking and savings accounts, but entrepreneurs can also take advantage of the following services:

  • Eastern Express Business Loan: Up to $100,000
  • SBA 7(a) Loans: Up to $5 million
  • SBA 504 Loans: Up to $5 million
  • Cash Reserves: Up to $10,000 to protect against overdrafts
  • Business Term Loans
  • Lines Of Credit
  • Business Credit Cards

Eastern Bank also has commercial financing options, including industrial lines of credit, commercial real estate loans, and asset-based lending.

You can learn more by visiting your local Eastern Bank branch or applying for your chosen financial product online.

Metro Credit Union

If you want a more personalized experience, consider joining a local credit union, such as Metro Credit Union. This institution has locations throughout the state of Massachusetts to best serve more than 200,000 members. Metro Credit Union branches are located in cities including Boston, Lawrence, Framingham, and Salem.

As a member of Metro Credit Union, you may be eligible to receive small business financing through one of its lending programs including:

  • Commercial Real Estate Loans
  • Business Lines Of Credit
  • Business Term Loans
  • Unsecured & Secured Business Credit Cards

Metro Credit Union also provides merchant credit card services, payroll services, and additional services to small business owners in Massachusetts.

To apply for financing, you must be a Metro Credit Union member. To become a member, you must:

  • Live, work, or own a business in one of the following counties: Barnstable, Bristol, Essex, Middlesex, Norfolk, Plymouth, Suffolk, Worcester
  • Open a Metro Regular Savings account with a $5 deposit

Common Capital

Common Capital is a community loan fund and nonprofit organization that provides tools, resources, and financing to small businesses and community projects in order to strengthen communities.

Through Common Capital, small business owners can apply for fixed and variable rate loans and lines of credit. Funding of up to $300,000 is available and can be used for the following purposes:

  • Working Capital
  • Inventory & Supplies
  • Equipment
  • Startup Costs
  • Business Acquisitions Or Expansion
  • Debt Refinancing
  • Leasehold Improvements Or Real Estate

Repayment terms are up to 10 years. Payments can be structured to account for seasonal fluctuations in revenue.
To qualify, you must own a business in the counties of Berkshire, Franklin, Hampshire, or Hampden. If you reside in Worcester County, you may be eligible to apply for the Fast Track Program, which provides up to $50,000 with a fast turnaround.

Loan applications are available online. You must provide historical financial statements and/or three years of future financial projections with your application. Startups must also include a business plan. The typical time to underwrite and close the loan is 4 to 6 weeks after the completed application package has been received.

Small Business Grants In Massachusetts

Grants are another source of financing you can use to start or grow your business. The good thing about grants is that these aren’t loans, so you won’t incur debt. You won’t have to repay the grant or worry about interest or fees.

However, this free money isn’t available to just anyone. Most of the time, you have to meet very specific requirements for small business grants, such as being in a particular industry or being a minority, woman, or veteran business owner. Even if you do qualify, most grants have many applicants.

While it isn’t guaranteed that you’ll receive a small business grant, there’s no harm in applying if you meet all of the requirements. There are a variety of state and federal resources available to help you locate small business grants, but you can kick off your search with these options.

State Trade Expansion Program Grant

The State Trade Expansion Program (STEP) grant is offered through the Massachusetts Office of International Trade and Investment in partnership with the Massachusetts Small Business Development Center Network, the Small Business Administration, and the Massachusetts Export Center. This grant is designed to help offset the costs of international business development and associated marketing costs.

Through this program, eligible small businesses can receive reimbursements of up to $12,000 for expenses including:

  • Compliance testing products for entry into an export market
  • Design of export market-specific marketing media
  • Overseas trade show or conference expenses

To qualify for STEP funding, an online application must be submitted. Proof of payment for the project, service, or activity must also be submitted for consideration. Applicants are also required to match 25% to 40% of funding.

Office Of Safety Workplace Safety Training Grant

The Office of Safety Workplace Safety Training Grant is a reimbursement program for businesses located in Massachusetts. This grant is provided through the Department of Industrial Accidents. Qualifying businesses can receive up to $25,000 to pay for training and education promoting workplace safety.

Businesses of all sizes are eligible to apply provided they are operating within the Commonwealth of Massachusetts and are covered under the state’s Workers’ Compensation Law.

To qualify, you must submit a grant package. Your package must include the grant application, a description of your business, training goals, a budget narrative and summary, qualifications of training providers, and a Department of Revenue Certificate of Good Standing.

Workforce Training Fund

The Workforce Training Fund provides business grants to support the training needs of businesses throughout the state of Massachusetts. There are two grant programs available.

General Program

The General Program is open to businesses of all sizes. Businesses can receive a training grant up to $250,000 through this program. Training grants must be matched dollar-for-dollar by the grant recipient.

Express Program

This program is open to businesses with 100 or fewer employees. Grants of up to $30,000 per company and $3,000 per employee per course are available through this program. Companies will be reimbursed up to 50% of training costs.

Grants can be used to pay for training for current and new employees. An online application can be submitted along with a cover letter, Certificate of Good Standing from the Department of Revenue, and a description of training modules and courses.

Loans & Resources For Startups In Massachusetts

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Finding the loans and resources you need for your startup business doesn’t have to be challenging. If you’re a small business owner in the Bay State, consider putting the following resources to work for you.

SCORE

The SBA’s SCORE program provides free and low-cost services and resources to small business owners. Through SCORE, you can take advantage of free business counseling and mentoring online or at a SCORE location near you.

SCORE also offers local workshops on a variety of small business topics such as accounting, management, and marketing. These events allow you to educate yourself on these topics while networking with other local business owners.

SCORE also has additional tools and resources available on its website. This includes business guides, free templates, and blogs that offer helpful tips and tricks to business owners.

There are multiple SCORE branches located throughout the state of Massachusetts in cities including Boston, Springfield, Amherst, and Salem.

Massachusetts Small Business Development Center Network

Since 1980, the Massachusetts Small Business Development Center (MSBDC) has provided free and low-cost resources to startups and established businesses. Through MSBDC, you can receive free one-on-one business counseling.

MSBDC also hosts free and low-cost seminars and events throughout the state. You can learn more about business topics such as developing your business plan, cash flow analysis, and financing options.

MSBDC offices can be found throughout the state in cities including Springfield, Fall River, Boston, and Salem.

What To Consider When Choosing A Lender

We’ve given you a list of lenders to finance your small business. Maybe you’ve even done your own research and have your own list. Now, it’s time to make a difficult decision: which lender should you work with? It’s important to weigh out all of your options and not just stick with the first lender that gives you an approval. You want to make sure that you make the wisest financial decision for your business. Do this by asking yourself the following:

Why Does My Business Need Money?

What is the purpose of your business loan? Not only will you have to put this on your loan application, but knowing exactly how you plan to use your funds can help narrow down your lender options. Let’s say that you want a flexible line of credit for emergency expenses. If a lender specializes in SBA loans, short-term business loans, or other financing that provides a lump sum, move on to the next lender.

How Much Money Does My Business Need?

Again, this is something you will need to include on your application. But you can also use this information to sort through lenders. If you need financing of at least $100,000, lenders that have lower maximum borrowing limits can be crossed off your list.

Can My Business Afford The Loan?

Lenders will look at a variety of factors to determine if you can afford a loan or other financial product. If you can’t, your application will be denied or you may be approved for a smaller amount. Don’t rely solely on the lender to determine the affordability of your loan. Consider your incoming revenue, your current expenses, and any fluctuations in income. Then, shop around with lenders that not only offer the amount of financing you need but also have the lowest rates and best terms for your situation.

Do I Meet All Requirements?

Do you meet all the requirements of your chosen lender? If a lender requires an excellent credit score, borrowers with scores below this requirement will be declined.

Have bad credit that’s preventing you from getting an affordable loan? If your need isn’t urgent, take the time to boost your credit. Obtain your free credit score, review your report, and take a few easy steps to raise your credit score. This will help you receive higher borrowing amounts, lower rates, and better terms.

Make sure you meet all other requirements, including time in business, annual revenue, and business credit history.

Final Thoughts

Starting or growing your small business can be a challenge. However, with the right resources and a source of capital, you’ll increase your chances for success. The state of Massachusetts offers multiple resources and financing options for your small business. You just need to take the time to evaluate the needs of your business and choose which resources offer the most benefits to you.

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Arizona Small Business Loans

Arizona is one of the fastest growing states in the nation; its warm, arid climate is a big attraction for people suffering from winter fatigue. That swelling population comes with some distinct advantages for entrepreneurs looking to start a business in the Grand Canyon State.

Of course, opening a business anywhere comes with challenges, many of which require money to circumvent. When that happens, you’ll want to know where you can turn to for a cash infusion.

We’ll take a look at some of the types of lending available to you in Arizona, as well as some specific lenders you may want to consider.

The Best Online Business Lenders For Arizona Businesses

If a local lender doesn’t immediately come to mind, you may want to consider an online lender. Most online lenders are willing and able to lend to Arizona-based businesses.

What are the advantages of working with an online lender? Generally speaking, online lenders are faster, have simpler application processes, and more flexible lending standards than traditional lenders. The tradeoff, of course, is they also tend to have higher rates and more concentrated repayment term lengths. That said, the best online lenders offer transparent terms and excellent customer service.

Arizona does have a maximum legal interest rate for loans, but these are easily circumvented with written contracts, so don’t necessarily count on state regulation to keep your rate under control. Note that regulations governing loans usually only apply specifically to loans and not to loan-like products like merchant cash advances.

Since there are tons of online lenders to sift through, here are some of our recommendations to get you started:

OnDeck

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One of the oldest and most mature online lenders, OnDeck offers short-term loans and lines of credit to businesses. They don’t necessarily have the lowest rates in the business, but their product lineup is versatile and transparent, so you should have few surprises.

BlueVine

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BlueVine is an interesting option for businesses that need a line of credit or who have unpaid invoices that they’d like to cash in a little early. Invoice factoring is not for everyone, but it is a way to infuse your business with cash without going into debt.

LoanBuilder

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PayPal’s LoanBuilder service is one of the faster and more transparent digital lenders, allowing you to tweak the terms of your loan somewhat to fit your needs. Their rates are also pretty decent, but as short-term loans, you’ll have to pay them back fairly quickly.

Fundbox

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Businesses with credit issues can have a hard time finding funding, but lenders like Fundbox make it a little bit easier. Like BlueVine, they offer lines of credit and invoice factoring. They also offer a service similar to invoice factoring called Fundbox Pay, which allows sellers to receive money for their services right away.

While Fundbox doesn’t have any hard credit requirements, they do want to see that your business does at least $50K/year in revenue.

Fundera

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An alternative approach to finding an online lender is to use an aggregating service like Fundera. Fundera doesn’t originate their own loans. Instead, when you apply to them, they’ll attempt to pair you with one of their lending partners. The advantage for you is that you’ll effectively be applying to multiple lenders at once with a single application.

Arizona Banks & Credit Unions

As convenient as online lenders can be for small businesses, that’s usually not where you’ll find the best interest rates or terms. Traditional banks aren’t obsolete, they’re just a bit trickier to qualify for post-2008, especially if you don’t have stellar credit.

Typically, the easiest way to get a bank loan is to have a pre-existing relationship with the bank you plan to apply to. Having the requisite accounts in place, as well as a convenient, in-house record of your transactions, can smooth out some of the bumps you might encounter in the application process.

If you have a good relationship with your local bank or credit union, be sure to inquire about their business products. National banks with branches in Arizona include:

Chase Bank

America’s biggest bank has branches scattered through Arizona’s major population centers. Despite their size and market share, they’re still pretty traditional when it comes to business loans, so you’ll have to apply in person.

If you can meet their requirements and don’t mind dealing with an enormous lender, Chase offers some of the best business loan rates out there.

Borrower requirements:
• Must have excellent credit (high 600s)
• Must have access to a Chase Bank branch
Read our Chase Bank review

Bank Of America

Another bank with a big presence in the Phoenix-Scottsdale area, Bank of America has very stringent lending standards. They do offer a more modernized application process than many of their competitors, however.

Line of credit borrower requirements:
• Must have been in business at least 2 years.
• Must have a personal credit score of 670 or above.
• Must have revenue > $200,000 for unsecured products, or greater than $250,00 for secured products.
Read our Bank of America review

 

US Bank

US Bank is one of the smaller of the big national banks, with a reputation for being a bit more personable and flexible. You’ll find them mainly around Phoenix and Tuscon.

Borrower requirements:
• Must be located in a state served by U.S. Bank
• Must have been in business for two years
Read our U.S. Bank review

 

Credit Unions

If you’re looking for the absolute best rates on loans, it’s hard to beat credit unions. As non-profit entities, credit unions can, at least in theory, provide lower rates than similar for-profit entities. On the other hand, be aware that even the biggest credit unions are nowhere near the size of even most mid-sized banks, so they can’t wield the advantages that come with scale.

Credit unions offering business loans are uncommon, but many offer personal loans that can be used for smaller business expenses.

Some of the more accessible credit unions in Arizona include:

  • Desert Financial Credit Union 
  • OneAZ Credit Union
  • Arizona Federal Credit Union
  • Vantage West Credit Union
  • TruWest Credit Union

Small Business Grants In Arizona

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Grants represent the holy grail of business financing: free money! Of course, as you can imagine, you won’t be the only one seeking it. Competition for grants is fierce and time-consuming; expect to make grant-seeking a part-time job if you choose to seek funding this way.

Grants tend to be targeted — to a specific industry, to a specific problem that needs to be solved, or to a specific demographic. They can be public or private in origin. Find a grant to apply for that fits the profile of your business and/or you as a business owner.

For some general advice on where to seek them, check out our grant feature.

Some Arizona-specific options you may want to consider include:

Arizona Step Grants

The AZSTEP program combines funds from the federal Small Business Administration with those of the Arizona Commerce Authority. These grants are designed to help small businesses enter the export market and increase their international sales.

Arizona Innovation Challenge

Held twice annually, the Arizona Innovation Challenge is a competition awarding applicants up to $150,000, with 10 awardees named each cycle. The grant is designed to help tech companies commercialize their products. An interesting note: you don’t actually have to live in Arizona to apply, you just have to be willing to relocate to Arizona within a 12-month timeframe.

Arizona Job Training Grants

Arizona’s Job Training Program can provide employers creating new jobs a grant that reimburses up to 75 percent of their eligible training expenses. Worth looking into if you’re expanding.

Resources For Startups In Arizona

Starting a business can be an anxiety-producing experience if you don’t have a network ready to support and advise you. Some organizations and programs that might be able to help you include:

  • Arizona Commerce Authority: A public-private economic development organization oriented around expanding Arizona businesses and recruiting new ones from out-of-state.
  • Arizona Small Business Association: A private organization that offering information and resources to the Arizona business community.
  • Small Business Administration: Though technically a federal agency, the SBA publishes state-specific information such as the Arizona edition of their Small Business Resource Guide.

What To Consider When Choosing A Lender

Even if your lender search feels desperate, remember that you still are their client, not the other way around. And that means they need to meet your requirements as well.

Need some help narrowing down lenders? Here are some factors to consider:

  • Your Industry: Some lenders specialize in lending to specific industry. Others can’t or won’t lend to certain industries. If they can’t write you a loan, cross them off your list.
  • Borrowing Amount: If you need $5,000, you’ll be looking at different lenders than if you need $5 million. Choose the right tool for the job.
  • Rates & Fees: How much is it going to cost you? Are the lender’s rates in line with the industry standard? Do they tell you what additional fees they charge, or do they hide them?
  • Time To Funding: Do you need the money right away or next quarter? Choose a lender that can work with your timetable.
  • Term Lengths: You’ll want to know how quickly you have to pay the money you’re borrowing back. Make sure you can afford the loan over the long-term.
  • The Type Of Expense Being Financed: Some financial products are limited in what they can be used for. Do you need a lump sum of cash? Or do you need a line of credit that you can draw upon periodically?
  • Collateral: Secured loans and lines of credit require some form of collateral, usually in the form of an asset, real estate, or cash deposit. If you don’t have collateral to put it, you’ll want to look at unsecured loans.

Final Thoughts

Companies seeking financing in Arizona have a wealth of options so long as they know where to look. And remember that just as important is finding a funding source that fits your needs and strategy.

Didn’t find what you were looking for? Want to see more options? We can help you compare lenders and credit cards.

Just starting out? Check out our resources for startups.

Need more specialized information? Check out our small business loan recommendations for veterans, women, minorities, or individuals with bad credit.

What’s Next
    • Learn what you can write off as small business tax deductions
    • Business loan options that don’t require a credit check
    • A guide to consolidating business debt

The post Arizona Small Business Loans appeared first on Merchant Maverick.

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The Best Business Loan And Financing Resources For Michigan Small Businesses

The state of Michigan has one of the fastest growing economies in the nation, a welcome relief to residents following the fallout from the 2009 recession. Cities like Detroit are bouncing back from this bleak period, unemployment is lower than it was in the early 2000s, and more people are opening or moving their companies to Michigan.

Michigan is ranked top in the nation for auto manufacturing, and other industries are emerging throughout the state. This includes cybersecurity, defense, aerospace, and agribusiness. Michigan is earning a reputation as one of the most business-friendly states in the nation.

It isn’t just large companies that are headquartered in the state, either. More residents are opening their own small businesses to pave the path for a successful future. If you’re reading this, you’re one of those entrepreneurs … or the thought of business ownership has at least crossed your mind. One of the most important factors in owning and operating a successful business is having access to capital and resources. Fortunately, the state of Michigan has many opportunities for business owners — whether you’re just getting started or you own an established business.

In this post, we’ll take a look at the funding opportunities open to Michiganders. From national online lenders to local credit unions, nonprofit lenders, and startup resources, we’ll cover it all to help you get the capital you need to start or grow your small business.

Online Business Lenders For Michigan Businesses

The internet has made our personal and business lives easier than ever, so it should come as no surprise that you can get capital for your business straight from your computer. Online lenders make it quicker and easier to receive business financing.

Not only is the lending process so much more convenient, but online lenders typically have less stringent requirements for qualifying. For example, getting a bank loan is difficult, even for established businesses owned by people with high credit scores. But many online lenders will approve borrowers with less-than-perfect credit scores and histories, newer businesses, and businesses that aren’t bringing in high revenues just yet.

Many online lenders provide capital to small business owners in Michigan, but you can start your search for capital with these options:

Lendio

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The loan aggregator Lendio lets you shop your financing options without spending hours filling out applications. Lendio has over 75 lending partners in its network – lenders you can reach with just one application.

Through Lendio, you can apply for the financing you need for your business, including:

  • Small Business Administration (SBA) Loans: $50,000 to $5 million
  • Term Loans: $5,000 to $2 million
  • Short-Term Loans: $5,000 to $200,000
  • Lines Of Credit: $1,000 to $500,000
  • Credit Cards: $1,000 to $500,000
  • Equipment Financing: $5,000 to $5 million
  • Commercial Mortgages: $250,000 to $5 million
  • Accounts Receivable Financing: Up to 80% of receivables
  • Startup Loans: $500 to $750,000
  • Merchant Cash Advances: $5,000 to $200,000

Borrower requirements, rates, and terms are based on a number of factors, including the type of financing you receive, the lender you work with, and your creditworthiness and/or business performance. Turnaround times also vary, but you may be able to receive funding in as little as 24 hours. Filling out an application to receive offers through Lendio’s network has no impact on your credit score. However, a hard pull on your credit may be performed once you select a lender offer to pursue.

OnDeck

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OnDeck offers small business owners two financing options: term loans and lines of credit.

With an OnDeck term loan, you may apply for up to $500,000. With the short-term loan option, you have 3 to 12 months to repay your loan. This option is best for funding marketing campaigns, purchasing inventory, or hiring new employees. Short-term loans from OnDeck come with a simple interest rate that starts at 9%.

Long-term loan options are also available. These loans have repayment terms of 15 to 36 months. Long-term loans are best for larger projects, such as business expansion, opening a new location, or purchasing equipment. The annual interest rate for long-term loans starts at 9.99%.

Both short-term and long-term loans have an origination fee of 0% to 4% of the loan amount. Payments are made daily or weekly and are automatically deducted from your business bank account.

To qualify, you must meet these requirements:

  • Time in business of at least 1 year
  • At least $100,000 in annual revenue
  • Personal credit score of 600 or above

The other financing option available through OnDeck is a line of credit. You may qualify for up to $100,000 to use for any business purpose, including paying for unexpected expenses and managing gaps in revenue. The APR for OnDeck lines of credit starts at 13.99%. Payments are made weekly and are automatically deducted from your business bank account.

OnDeck lines of credit come with no draw fees. However, there is a $20 maintenance fee charged each month. This fee will be waived for 6 months if you make a draw of at least $5,000 within 5 days of opening your account.

To receive a line of credit from OnDeck, you must have:

  • Time in business of at least 1 year
  • At least $100,000 in annual revenue
  • A personal credit score of 600 or above

IOU Financial

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If you need up to $500,000 to fund your small business, try applying for a loan from IOU Financial. With IOU Financial, you can prequalify in just minutes. In fact, 85% of all applicants are pre-approved for funding, according to the lender. You can receive funding in as little as 24 hours through IOU Financial.

With this loan option, you can receive $10,000 to $500,000 with terms between 6 and 12 months. Fixed daily or weekly payments are automatically debited from your business bank account.

Once you’ve paid off 40% of your loan, you may qualify for a loan renewal for additional capital for your business. There are no prepayment penalties, and you can save money on interest by paying your loan off early.

To qualify for funding through IOU financial, you must meet these requirements:

  • Own at least 80% of your business
  • Time in business of at least 1 year
  • At least 10 monthly deposits in your business bank account
  • Annual revenue of at least $100,000
  • Average ending balance of at least $3,000 per day in your business bank account

Credibly

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Credibly is an online lender that offers three financing options for small business owners. You may qualify to receive a working capital loan, a business expansion loan, or a merchant cash advance (MCA).

Credibly’s working capital loans are available up to $400,000 with repayment terms of 6 to 18 months. Instead of your traditional interest rate, Credibly uses a factor rate to determine the cost of borrowing. Learn more about factor rates and how they affect the cost of your loan.

Daily or weekly payments are automatically deducted from your bank account to repay your loan. Despite its name, these loans don’t have to be used for just working capital and can be used for other business purposes.

To qualify for a working capital loan, you must have:

  • Time in business of at least 6 months
  • Personal credit score of 500 or above
  • An average of $15,000 or more in monthly deposits

If you’re ready to grow your business, consider applying for Credibly’s business expansion loan. This loan program provides up to $250,000 with terms of 18 or 24 months and interest rates starting at just 9.99%. Weekly payments are automatically deducted to repay your loan.

To qualify for this financial product, you must have:

  • Time in business of at least 3 years
  • Personal credit score of 600 or above
  • Average of $15,000 or more in monthly deposits
  • Average daily balance of at least $3,000

Finally, you may qualify for a merchant cash advance. This is a little different from a loan because the lender agrees to purchase a percentage of future receivables. Daily repayments are made from your bank account based on a percentage of your sales.

With this financing option, you can receive up to $400,000. Terms are typically 3 to 18 months and factor rates start at 1.15.

To qualify for an MCA, you must have:

  • Time in business of at least 6 months
  • Personal credit score of 500 or above
  • Average of $15,000 or more in monthly deposits

Kabbage

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If flexibility is the most important factor for your small business financing, consider applying for a Kabbage line of credit. Instead of one lump sum, you’ll have access to a revolving account you can draw from whenever you need capital. You can use your line of credit for emergency expenses, revenue gaps, working capital, or for any other business purpose.

Kabbage’s lines of credit are available up to $250,000 for qualified borrowers. Repayment terms are 6 months for draws under $10,000. For loans of $10,000 or above, you can choose from 6- or 12-month terms. Kabbage charges a monthly fee between 1.5% and 10% of your principal loan amount. If you pay your loan off early, you can save money on fees. If you haven’t made a draw on your line of credit, you won’t be required to pay any fees.

Kabbage bases its approval decisions on the performance of your business, so even business owners with credit challenges may be approved. You can be approved in just minutes for up to $100,000. Lines of credit exceeding $100,000 require manual approval by the lender.

To receive a line of credit from Kabbage, you must meet these minimum requirements:

  • A business that is at least 1 year old
  • At least $50,000 in annual revenue OR at least $4,200 per month for the last 3 months

LendingPoint

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Sometimes, you have to get a little creative with your small business funding. One option to consider is taking out a personal loan to use for business expenses.

Why choose a personal loan instead of a business loan? For starters, your time in business, business credit score and history, and annual revenues will not be a requirement to qualify. This is great if you’re a new business, have low revenues, or haven’t yet established business credit. Instead, lenders like LendingPoint will evaluate your personal credit history, income, and other factors when determining whether you qualify for funding.

LendingPoint has personal loans from $2,000 to $25,000 for qualified borrowers. You’ll have 24 to 48 months to repay your loan, with payments due twice per month. APRs start at 15.49%.

To qualify for a personal loan through LendingPoint, you must meet these requirements:

  • Be at least 18 years old
  • Have a U.S. ID and SSN
  • Have at least $20,000 in annual income
  • Have a verifiable personal bank account
  • Have a personal credit score of at least 585

Banks, Credit Unions, & Nonprofit Lenders In Michigan

Prefer to go the more traditional route? Banks, credit unions, and nonprofit lenders throughout the state of Michigan offer financial solutions for your small business. If you don’t have a relationship with a financial institution or you just want to shop around your options, try these lenders first.

Comerica Bank

Comerica Bank has provided financial services since 1849. Today, Comerica has over 400 banking centers nationwide. In the state of Michigan, banking centers can be found in cities including Dearborn, Detroit, and Battle Creek.

For small businesses, Comerica offers financial services including:

  • Lines Of Credit: $10,000 to $500,000
  • Term Loans: Up to $500,000
  • Commercial Real Estate Loans: Bridge loans, land acquisition loans, development loans, commercial construction loans
  • Equipment Leases: Up to 100% financing
  • SBA Loans: Up to 90% financing
  • Letters Of Credit

Comerica also offers corporate lending services for public and private companies, including working capital loans, asset-based loans, and acquisition financing.

Lake Michigan Credit Union

Lake Michigan Credit Union is one of the largest credit unions in the state with branches located in areas including Grand Rapids, Kent County, Kalamazoo County, and Saginaw County.

In addition to business checking and savings accounts, you can apply for financing options through LMCU, including:

  • SBA Loans
  • Lines Of Credit
  • Business Credit Cards
  • Commercial Real Estate Loans
  • Secured Term Loans
  • Letters Of Credit

To apply for financing, you must be an LMCU member. Members must meet one of the following requirements:

  • Live, work, or worship in the Lower Peninsula
  • An immediate family member is a member of LMCU

Opportunity Resource Fund

Opportunity Resource Fund is a nonprofit community development financial institution (CDFI) that provides financial support to small businesses throughout the entire state of Michigan.

Through Opportunity Resource Fund, qualified borrowers may receive funding for starting or growing a small business. Business loans are available in amounts from $10,000 to $250,000 with flexible terms and competitive interest rates.

This nonprofit lender considers several factors when approving loan applications. The first is collateral. All loans must be secured with collateral including real estate, inventory, accounts receivables, equipment, or a personal guarantee. Loans also require an equity investment of 10% to 15%.

Opportunity Resource Fund also requires borrowers to meet certain social criteria. This includes aspects such as demonstrating alternative business practices, providing employment to low-income individuals, and empowering woman- and minority-owned businesses.

Applications are available to download on the Opportunity Resource Fund website. If you’re interested, you can also fill out the online form to learn more about the application process and timelines for submissions and approvals.

Small Business Grants In Michigan

Reaching out to an online or local lender isn’t your only option when you need capital to start or expand your business. You can also look to small business grants to get the funding that you need.

Grants differ from small business loans and other types of financing because grant funds do not have to be repaid. Why, then, isn’t every small business owner leaning on grants?

The problem is that grants are few and far between. While you can search online and find multiple lenders in your area, finding grants is a bit more difficult. Even when you do come across grants, you’ll often find that you won’t qualify. Grants typically have very specific requirements, and many are only open to certain industries or women- or minority-owned businesses. There is also a lot of competition from other small businesses pursuing the same grants.

This isn’t meant to be discouraging. It’s simply a warning not to rely solely on receiving grants to fund your business. However, there’s no harm in applying for grants that you do qualify to receive. To kick off your search for a grant, check out these options that are open to small business owners in Michigan.

Community Ventures

The Community Ventures initiative is led by the Michigan Economic Development Corporation. Through this program, employers can receive wage reimbursements of up to $5,000 for each eligible “structurally unemployed” employee that is hired. A structurally unemployed employee is defined as:

  • Someone with a lack of education or functional literacy
  • Someone with a long-term disconnection from employment
  • Low income hires
  • Ex-offenders
  • At-risk youth

Reimbursements are given in monthly installments until the $5,000 per employee limit is reached. These funds are used to offset costs for training and hiring participants in the CV program. Businesses are required to report each month on hired and retained talent for up to one year. If you’re interested in learning more, you can contact the MEDC Customer Assistance Center by phone or email.

NEIdeas

If you live in Detroit, Hamtramck, or Highland Park, you could receive $10,000 for your small business through the NEIdeas $10k Challenge. A total of 26 winners are each awarded $10,000 for coming up with the best ideas for growth.

To qualify, businesses must meet the following requirements:

  • Be an existing, for-profit business
  • Majority owner must be a legal U.S. resident at least 18 years old
  • Business must be in good standing with the IRS
  • Businesses must be based in Detroit, Hamtramck, or Highland Park
  • Gross annual revenues should not exceed $750,000

Home-based businesses and regional businesses based in Southeast Michigan can also apply. Franchises are ineligible to enter.

Program guidelines can be found on the NEIdeas website. Applications can be submitted online, mailed, or turned in to an NEIdeas Ambassador.

SCIP/TCA

Michigan Corporate Relations Network’s Small Company Innovation Program Technology and Commercialization Assistance (SCIP/TCA) program is designed to help businesses grow through collaborations with local universities. Through this program, small businesses can receive matching grants up to $40,000 to fund the cost of research projects at any public university in Michigan.

Any existing, LARA-registered business in Michigan that plans to remain in the state is eligible to apply. Getting accepted into the program is not a guarantee of funding. All guidelines for the program can be found on the Michigan Corporate Relations Network website. Applications for the program are also available online.

Loans & Resources For Startups In Michigan

Taking the leap into entrepreneurship is an exciting time, but it can also be intimidating, especially if you have no prior experience running a business. Fortunately, there are many resources available to Michiganders, including educational materials, workshops, mentorships, and funding opportunities.

SCORE

SCORE, a resource partner of the SBA, is one of the leading resources for small business owners. There are hundreds of SCORE chapters across the nation that provide essential resources to small business owners for free or for a low fee. SCORE chapters are located throughout Michigan in cities including Kalamazoo, Grand Rapids, and Detroit.

Through your local SCORE chapter, you can receive free business mentoring from an expert. You can meet with your mentor face-to-face or connect through email or video chat. You can also pick up business tips through SCORE’s webinars that are held every week. If you miss a webinar, don’t worry — SCORE offers an on-demand library of recorded webinars. You can also educate yourself on a variety of business topics through SCORE’s on-demand online courses. Workshops, events, and educational materials are also offered through this organization.

Michigan Small Business Development Center

The Michigan Small Business Development Center offers great resources for startups and established businesses. There are multiple business resource centers, regional centers, and satellite offices throughout the state in cities including Hastings, Kalamazoo, Lansing, Dearborn, and Detroit.

All resources through the Michigan SBDC are free or low-cost. Services include business consultations, workshops, training sessions, templates, and educational materials.

Michigan Women’s Foundation

The Michigan Women’s Foundation provides capital and resources to women-owned businesses in the state of Michigan. Women that own startups or established businesses are eligible for the programs available through MWF.
Programs offered include business consulting, training and educational sessions, and portfolio management. The Michigan Women’s Microloan Fund also provides loans of $2,500 to $50,000 with 5-year terms and an 8% interest rate to qualified business owners.

What To Consider When Choosing A Lender

The good news is there are many lenders both online and in the state of Michigan that are ready to give your business the capital it needs. The bad news? You have to narrow your selection down to one, preferably the lender that offers the best, most affordable financing for your small business.

Sorting through your options to choose the right lender doesn’t have to be too difficult or time-consuming, though. When searching for your lender, keep the following points in mind.

Application Process

The application process varies across lenders. With some lenders, a little bit of business and personal information and a few bank statements are all it takes to get approved. Other lenders, however, may have more extensive documentation requirements and a lengthier, more complicated application process.

If time is of the essence and you don’t want to go through a difficult application process, choose an online lender with a more simplified process.

Speed Of Approval

You have an emergency that needs to be taken care of immediately. In this scenario, waiting weeks to get the capital you need could be damaging to your business. Or maybe your situation looks a little different. You don’t have an immediate need for funding, and you have time to shop around for the best rates and terms available to your business, so time to funding may not be as important.

Evaluate your situation to determine if time to funding is an important factor for you. If so, work with a lender that approves applications quickly. Some lenders can even have the funds in your bank account in as little as 24 hours.

Loan Restrictions

How do you plan to use your funds? This could be a determining factor in what lender you select. Let’s say you need capital to hire new employees. Lenders that offer equipment financing for fixed asset purchases could be crossed off your list.

Borrowing Limits

The type of financing and the lender you choose may be based on how much capital you need. For instance, if you need $500,000 to fund your new expansion or a new location, lenders that have $250,000 borrowing limits won’t be a good fit.

Rates & Terms

It’s always important to make sure you’re getting the best rates and terms for your situation. If you have credit challenges or you’re a new business, your options may be more limited. However, if you have a solid credit score, an established business, and a steady flow of revenue, you’ll have more lending options available to you.

No matter what options are available, always make sure you’re getting the best rates and terms. Think of the long term and not just the short term. Sure, you could have funds in your account in just one day with one lender, but high fees and interest rates and shorter repayment terms could spell trouble in just a few months.

Unsure if you’re able to afford a small business loan? Learn how to know if you’re ready to take on this financial responsibility.

Borrower Requirements

You may think a lender is right for you, but are you right for the lender? Every lender has different requirements for its borrowers, and you need to meet all of these to get approved for financing.

Before you start shopping lenders, start by getting your free credit score online and reviewing your credit history. Negative items like unpaid tax liens and recent bankruptcies may prohibit you from working with some lenders and qualifying for certain types of loans.

You’ll also need to know your time in business and annual revenues and have proof to present to the lender if needed. Also, be aware of documentation requirements and make sure that you have everything you need to be approved for a loan.

One last thing to remember is that meeting a lender’s minimum requirements does not guarantee that your application will be approved.

Final Thoughts

While no one is ever guaranteed success, having access to capital and the right resources can boost your chances of owning and operating a successful, profitable business. As you’ve read, there are plenty of opportunities available for Michiganders. Whether you’re in the planning stages of your startup or you want to take your small business to the next level, know and understand your financing options, evaluate the needs of your business, do your research, and move forward when you know that the return-on-investment will outweigh the risk of taking on debt.

If you didn’t find what you’re looking for in this post, check out some of our additional resources to help you find the right financial solution for your small business.

  • Minority Business Loans
  • Best Small Business Loans For Veterans
  • The Best Small Business Loans For Women
  • The 7 Best Business Loans For Bad Credit

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The Best Business Loan And Financing Resources For Indiana Small Businesses

In past years, Indiana’s economy has mainly centered around steel production and manufacturing. However, since the 1990s, the state’s economy has become more diverse, expanding into sectors including banking, education, financial services, and information technology. Combined with a growing population — particularly in the Central Indiana region — this has opened up new opportunities for entrepreneurship.

In Indiana and across the nation, more people are leaving their 9-to-5s and setting out on their own entrepreneurial path. Maybe you’ve already taken this step, or perhaps you’re just waiting to take the leap. No matter where you are in your journey, though, one of the most important resources for a small business is capital. In order to operate a successful small business, you have to have access to capital. But a big question plaguing many small business owners and aspiring entrepreneurs is where to find this capital.

If you’re a small business owner in Indiana, this post is for you. In this post, we’ll review small business loans that Indiana entrepreneurs just like you can use for funding startups, paying operational costs, or growing their businesses. Read on to learn more about the financing opportunities and resources available to you.

Online Business Lenders For Indiana Businesses

As a small business owner, your plate is already loaded down with daily tasks. Managing your business, ordering inventory, hiring and training employees…the list goes on. When you’re in need of capital, finding the time to gather documentation and head over to your local bank may seem impossible. Fortunately, online business lenders have made it easier than ever to get the capital you need for your business.

With an online lender, you can apply for small business financing from your home or office on your computer or smartphone. You can submit documentation, communicate with the lender, and even sign your loan documents without ever stepping foot into a bank or financial institution.

Depending on the financial product you select and the lender you work with, borrower requirements may also be far less stringent. This means that startups, borrowers with personal credit challenges, or businesses with no credit history have options that wouldn’t be available through traditional lenders.

In some cases, you may even be able to complete the entire process from application to funding in as little as 24 hours — a great option for businesses that need cash immediately.

There are thousands of online lenders to choose from, but start your search with the following lenders, which provide financial solutions to small businesses in Indiana.

Fundera

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Unsure of which financial solution is right for your business? Fundera helps you find the best options for your business. With Fundera, you’ll be able to compare lender offers with just one application.

To get started, all you have to do is fill out a quick application. Submitting your application has no impact on your credit score. Once your application has been received, you’ll work one-on-one with a financial specialist to evaluate the financial needs of your business and review lender offers. Your financial specialist will help you select the product that’s the best fit for your business. Best of all, this service is absolutely free.

There is a wide array of financial products available to you through Fundera. This includes:

  • Small Business Administration (SBA) Loans:S $5,000 to $5 million
  • Lines Of Credit: $10,000 to $1 million+
  • Term Loans: $25,000 to $500,000
  • Startup Loans: Up to $150,000
  • Equipment Financing: Up to 100% of equipment value
  • Short-Term Loans: $2,500 to $250,000
  • Invoice Financing: Up to 100% of invoice value
  • Merchant Cash Advances: $2,500 to $250,000
  • Personal Loans For Business: Up to $35,000

Borrower requirements, rates, and terms vary based on the products you qualify to receive. Options such as short-term loans and merchant cash advances are easier to qualify for, but these come with less favorable rates and terms than SBA loans, which are more difficult to receive.

The good news is that your financial specialist will work with you to review the options you qualify for and help you choose the product that’s best for you.

SmartBiz

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Small Business Administration (SBA) loans are extremely popular with small business owners. This is because you receive low rates and very favorable terms, similar to bank loans. However, because SBA loans are backed by the government, lenders feel more secure in giving them to small business owners. Even if you’ve been turned down for a low-cost bank or credit union loan, you may still qualify for an SBA loan.

One of the drawbacks of SBA loans is the application and approval process. The process can seem overwhelming, especially if you’ve never applied for a loan before. Receiving an SBA loan can also take weeks. In some cases, getting the funds in your bank account may even take months.

Fortunately, there is a solution. SmartBiz simplifies and expedites the SBA loan process. You can prequalify for your loan in as little as 5 minutes. You may also receive your funds in just 7 days.

Through SmartBiz, you can qualify for an SBA working capital and debt refinancing loan. Funds can be used to refinance existing debt, hire employees, purchase equipment or inventory, or expand your business. These loans are available in amounts from $30,000 to $350,000. Interest rates are 8.25% to 9.25% with repayment terms up to 10 years.

To receive this loan, you must meet the following requirements:

  • At least 2 years in business
  • U.S. citizen or legal permanent resident
  • Personal credit score of 640 or above
  • Sufficient cash flow
  • No bankruptcies or foreclosures within the last 3 years
  • No outstanding tax liens
  • No past defaults on government-backed loans

If you’re looking to fund a major expansion, consider applying for an SBA 7(a) commercial real estate loan through SmartBiz. These loans provide funding from $500,000 to $5 million. Interest rates are 7% to 8.25% with repayment terms up to 25 years.

Fund from these loans can be used to refinance your commercial real estate mortgage or purchase commercial real estate. Funds can’t be used for new construction or for investment properties.

Borrower requirements for the SBA 7(a) commercial real estate loan are as follows:

  • At least 3 years in business
  • At least 51% of the property must be owner-occupied
  • U.S. citizen or legal resident
  • Personal credit score of 675 or above
  • Property must have a purchase price of $500,000 or more
  • No bankruptcies or foreclosures within the last 3 years
  • No outstanding tax liens
  • No past defaults on government-backed loans

LoanBuilder

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It’s your loan, so why does the lender get control of setting the rates and terms? Shouldn’t you have control? With LoanBuilder, you can “build” your own loan, creating a financial solution that’s best for your business.

You can apply for $5,000 to $500,000 through LoanBuilder. After filling out a quick questionnaire, you’ll be presented with a financing offer. You can adjust the amount of your loan and the duration to get the most affordable option for your business. Once you’ve customized your loan, you’ll finish the application and submit any required documentation. If approved, you could receive your funds in as little as 24 hours.

Prequalifying for a loan offer has no impact on your credit score. However, personal credit and public records will be assessed if you decide to proceed with a loan offer.

LoanBuilder loans have repayment terms of 13 to 52 weeks. Weekly payments are made toward your principal balance plus the fees charges by the lender. LoanBuilder charges a single fixed fee for its loans. Fees start at just 2.9% of the loan amount. LoanBuilder loans can be used for any business purpose.

To qualify for funding through LoanBuilder, you must have:

  • A time in business of at least 9 months
  • At least $42,000 in annual revenue
  • A personal credit score of 550 or above
  • No active bankruptcies

Fundation

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Whether you need a specific amount of money or a more flexible financing option, you can find both with Fundation. Through Fundation, you can apply to receive a term loan or line of credit to fund your business expenses.

Fundation offers term loans up to $500,000 for use on equipment, improvements, or business expansion. Loan terms are up to 4 years with repayments made twice per month. The APR for term loans starts at 7.99%.

If you need cash for working capital or short-term cash flow needs, consider Fundation’s lines of credit. You may qualify for as much as $150,000 with repayment terms up to 18 months. Your balance is repaid once per month. APRs start at 7.99%.

To qualify for Fundation’s financial products, you must have:

  • A time in business of at least 12 months
  • At least $100,000 in annual revenue
  • Personal credit score of 660 or above
  • At least 3 full-time employees

BlueVine

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If you need a line of credit to cover emergencies, operational costs, or other business expenses, you may qualify for a line of credit through BlueVine. This online lender provides lines of credit up to $250,000.

With a BlueVine line of credit, you can receive funding in just minutes. You’ll only pay for what you borrow, and you’ll have the option to repay the lender through monthly or weekly payments over 6 to 12 months. Rates start at 4.8%.

To qualify, you must meet these requirements:

  • At least 6 months in business
  • At least $100,000 in annual revenue
  • Personal credit score of 600 or above

If unpaid invoices are causing cash flow issues in your business, BlueVine also offers an invoice factoring service. You can receive up to $5 million for your unpaid invoices with rates starting at just 0.25% per week. BlueVine provides up to 90% of your invoice amount upfront. The remaining amount — minus fees ––will be given to you once the invoice is paid.

To qualify for invoice factoring, you must own a B2B business and meet these additional minimum requirements:

  • At least 3 months in business
  • At least $100,000 in annual revenue
  • Personal credit score of 530 or above

Amex Business Loans

American Express OptBlue

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If you’re an American Express cardholder, you could qualify for a low-interest, fixed-rate business loan of $3,500 to $50,000. Your loan can be used for any business purpose, and you can receive funding in as little as 3 business days.

Your loan is repaid over terms of 12, 24, or 36 months. Interest rates range from 6.98% to 19.97%.

To qualify for American Express Business Loans, you must be a pre-approved Business Card Member. Additional minimum requirements are:

  • At least 18 years old
  • U.S. citizen or permanent resident
  • Be in good standing with American Express

Funds can’t be used for personal purposes. You also can’t use your Business Loan proceeds to pay off debts to American Express.

Amex Merchant Financing

American Express OptBlue

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Business loans aren’t the only type of financing offered through American Express. If your small business accepts American Express cards, you may qualify for a different financial solution: American Express Merchant Financing.

You could receive a business loan of $5,000 to $2 million. Your loan comes with a single fixed fee of 1.75% to 20% of the borrowing amount. If you repay your loan early, you may even receive a rebate of up to 25% of your fee.

Repayment terms are 6, 12, or 24 months. You can have a fixed amount debited from your business bank account each day. If you’d rather have a more flexible option, you can choose to have a percentage of your daily receivables deducted instead. You can use your receivables from American Express or from all credit and debit transactions if you go this route.

To qualify, you must meet these minimum requirements:

  • At least $12,000 in annual credit and debit receivables
  • At least $50,000 in annual business revenue
  • Time in business of at least 24 months
  • Must accept American Express

Prosper

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If time in business requirements are holding you back from getting the capital your business needs, consider applying for a personal loan. In most cases, you can use the funds from a personal loan for business purposes. This eliminates time in business, annual revenue, and business credit history requirements.

While you can certainly apply for a personal loan through your bank, online lenders make it quicker and easier than ever to access funding. One online option is Prosper, which has loaned $14 billion to nearly 900,000 borrowers.

With a Prosper loan, you’ll have fixed 3- or 5-year repayment terms. Personal loan APRs range from 6.95% to 35.99%. Loans are available in amounts from $2,000 to $40,000.

Borrowers must meet the following minimum requirements:

  • Debt-to-income ratio below 50%
  • A source of income
  • No bankruptcies within the last 12 months
  • Less than 5 credit bureau inquiries within the last 6 months
  • At least 3 open trade accounts

Banks, Credit Unions, & Nonprofit Lenders In Indiana

Of course, online business lenders aren’t your only option. You can get the financing you need from a bank, credit union, or nonprofit lender. Find out the options available through your own financial institution, or check out one of the following lenders in the state of Indiana.

1st Source Bank

1st Source Bank was founded in 1863 in South Bend. Since its founding, it has won multiple local awards and has received recognition from Forbes, BauerFinancial, and Bank Director Magazine. This financial institution now operates 80 banking centers located across 18 counties.

Through 1st Source Bank, you can apply for a variety of financing options including:

  • Commercial Mortgage Loans: Terms up to 15 years
  • Term Loans: Terms up to 10 years
  • Business Acquisition Loans: Terms up to 10 years
  • SBA Loans
  • Lines Of Credit
  • Leases
  • Equipment Financing
  • Farm Loans
  • Business Specialty Financing

You can also sign up for business checking accounts, business and commercial insurance, and retirement plan services. Visit your local branch for more information.

Indiana Members Credit Union

Indiana Members Credit Union has 26 locations to serve residents in Indiana. This member-owned financial institution was first established in 1956 and has since grown to serve over 125,000 members throughout Central Indiana.

IMCU offers business checking, savings, CDs, and health savings accounts. You can also apply for financing, including:

  • Commercial Real Estate Loans
  • Lines Of Credit
  • Equipment & Inventory Financing
  • Business Credit Cards
  • Construction Loans

All borrowers must be IMCU members. To join the credit union, you must meet one of the following requirements:

  • Live or work in an eligible Central Indiana county
  • Work for an affiliated employer
  • Have a family member that is an IMCU member

Downloadable loan applications are available on the IMCU website. You can complete the loan application and send it with all required documentation to the IMCU Business Services & Lending Department, or you can drop your packet off at your local branch.

Indiana Statewide Certified Development Corporation

The Indiana Statewide Certified Development Corporation has assisted thousands of small businesses in the state in receiving funding through the Small Business Administration’s 504 loan program.

Under this program, you can qualify for financing for fixed asset purchases. This includes commercial real estate, machinery, and equipment. The Indiana Statewide CDC provides up to 40% of your project costs, while up to 50% is provided through a traditional lender. Then, you’re responsible for the remaining 10% of project costs.

SBA 504 loans come with fixed rates over terms of 20 years for real estate or 10 years for equipment.

Small Business Grants In Indiana

startup grants

If you don’t want to take on debt but need financing for your business, consider exploring small business grants. Small business grants provide the capital you need for your business without the requirement of repaying the funds. Yes, that means no monthly payments, no interest rates or fees, and no debt for your business.

However, scoring a small business grant isn’t as easy as filling out a quick online application, running your credit score, and getting financing. You’ll face a lot of competition to receive a small business grant. The application and approval process can often be quite extensive. You may even have to meet very specific requirements, such as being a veteran-owned business or operating within a certain industry.

In other words, there’s no guarantee that you will receive or even qualify for a small business grant. However, there are a few opportunities available to small business owners in Indiana that may be a fit for your business. Start with these options.

Elevate Ventures High Potential Startup Grant

Elevate Ventures is one of Indiana’s largest venture capital firms. This organization provides multiple financial opportunities for businesses, including High Potential Startup Grants. High-potential startups in communities throughout Indiana may qualify to receive awards of $5,000 to $25,000. Elevate Ventures also offers Small Business Innovation Research and Small Business Technology Transfer grant matches up to $150,000. To learn more about requirements and the funding application process, submit an inquiry through the Elevate Ventures website.

GoGlobal Grant Export Acceleration Program

The GoGlobal Grant Export Acceleration Program is a collaboration between the Indy Chamber and JPMorgan Chase. Through this program, matching grant funding of up to $5,000 is available to support export activities of qualifying businesses. Funds can be used for trade show attendance and conference costs, export plan development, and other company expenses related to export activities.

To qualify, you must:

  • Be in business for at least 2 years
  • Have primary operations based in the Indianapolis metro area
  • Participate in a one-on-one business coaching session

Priority is given to businesses with fewer than 250 employees and less than $20 million in annual revenue. You can learn more and apply for the grant by sending an email inquiry through the Indy Chamber website.

The Startup Ladies

Women-owned businesses can join The Startup Ladies for a small fee and have access to resources for starting and growing their businesses. Through The Startup Ladies, female entrepreneurs can attend events, access educational materials, and connect with potential clients and investors.

The Startup Ladies also offers funding opportunities. Members can apply for funding through The Startup Ladies Fund. The organization can also help members identify federal SBIR/STTR grant opportunities that are best for new businesses.

Loans & Resources For Startups In Indiana

Startups don’t always have access to the same financial opportunities as established businesses. Startups are seen as “risky” by lenders simply because they do not have a proven track record of success. A lack of revenue, business credit score, and history all spell big risk to lenders.

However, this doesn’t mean that there’s a lack of resources for startups. We’ve already reviewed a few lending options available to startups, such as personal loans for business. Now, let’s explore other resources available to startup businesses in Indiana, from mentorships to workshops and educational materials. Best of all, these resources are available to you for free or for a very low fee.

Indiana Small Business Development Center

The Indiana Small Business Development Center offers small business advising and services at no cost to small business owners in Indiana. There are 10 regional offices located throughout the state.

This organization can advise you on a variety of business topics including:

  • Market Research
  • Business Planning
  • Strategy
  • Exporting
  • Loan Assistance

The Indiana Small Business Development Center also offers workshops and events for small business owners for no cost or a small fee.

SCORE

If you need a business mentor, look no further than SCORE. Through one of the organization’s 300 chapters throughout the nation, you can connect with a business mentor at no cost. There are multiple chapters located in the state of Indiana.

SCORE’s business mentors can answer your questions and offer guidance in starting or growing your business. You can connect with your mentor through email, video chat, or face-to-face.

SCORE also offers educational opportunities and other free services to startups and established small businesses. This includes live and recorded webinars, online courses, and workshops.

Launch Indiana

Launch Indiana provides resources to help increase entrepreneurialism throughout the state. The organization’s goal is to foster innovation and growth for entrepreneurs and startup businesses.

Through Launch Indiana, you can take advantage of mentorships with coaches and experienced business owners. Other resources include videos, case studies, events, and other business tips and advice to help you grow your business and network with other entrepreneurs and businesses. Launch Indiana is also working to build co-working spaces and Internet of Things labs throughout the state to open up even more opportunities for business owners in Indiana.

What To Consider When Choosing A Lender

With thousands of lenders to wade through, which option is best for your business? Unfortunately, every business has different financial needs, so there’s no one-size-fits-all option when choosing a lender. The good news is that with a few factors in mind, you can more easily cut down your list of options to choose the lender that’s right for your business.

Type Of Financing

What type of financing do you need? Let’s say you don’t need money right now but would like an option for emergencies or expenses that arise in the future. In this case, you’d apply for a line of credit or business credit card. Seek out lenders that offer this type of financing. If you’re unsure of which type of financing is best for you, consider working with a lender that offers multiple financing options. These lenders can work with you to help find the best, most affordable solution for your business.

Borrowing Amount

How much do you need to borrow? If you need $250,000, not all lenders offer this amount. Others have much lower borrowing limits. These lenders can be crossed off your list.

Affordability

When you receive small business financing, you don’t just pay back the amount that you borrow. Instead, you’ll have to pay interest on borrowed funds and/or additional fees required by the lender. Make sure that you understand the cost of working with each lender on your list, and make sure that the rates, fees, and terms work for your business. Learn more about how to determine if your business can afford a small business loan.

Borrower Requirements

Do you meet all borrower requirements? Pull your free credit score online before you apply with any lender. Check your credit history to ensure there’s nothing that could prevent you from qualifying with a lender, such as a recent bankruptcy or a high number of credit inquiries. Run your financials to make sure you meet annual revenue requirements. If you don’t meet all requirements of one lender, move on to other options.

Final Thoughts

As a small business owner in Indiana, there are financial options open to you, whether you’re just getting started or you’re ready to expand your existing business. Unable to find an option that’s best for you? No problem. Check out our other resources to find the small business loan that’s best for your situation.

  • Best Small Business Loans For Veterans
  • Minority Business Loans
  • The Best Small Business Loans For Women
  • The 7 Best Small Business Loans For Bad Credit

The post The Best Business Loan And Financing Resources For Indiana Small Businesses appeared first on Merchant Maverick.

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How To Start And Fund A Catering Business: The Step-By-Step Guide

Does serving delicious food to a crowd of partygoers sound like a dream? Do you want to take your love of desserts to weddings and other special events? If so, becoming a professional caterer could be the right career path for you.

Sure, you could search your local job listings to find a catering position, but wouldn’t it be great to be your own boss? If creating your own menu and serving up delicious food and beverages at events interests you, why not start your own catering business?

Maybe it’s been a lifelong dream to operate your own catering business. Or maybe you just love to cook and want to turn it into a career. Whether you’ve already taken steps to launch your own business or you don’t know quite where to start, this post is for you.

In this article, we’re going to explore exactly what it takes to start and fund your own catering business. We’ll start by discussing how to create a business plan and why a plan is a necessity for a successful business. Then, we’ll delve into the expenses you’ll encounter and how you can cover those costs. We’ll also talk about choosing your business structure, building your web presence, and advertising methods that can bring in new customers.

Ready to go? Let’s get started on your path to entrepreneurship!

Create Your Business Plan

What Information to Bring Accountant for Small Business Taxes

Starting a business without a detailed business plan is similar to taking a cross-country trip without a GPS or a map. In short, it’s not a wise move. Your business plan should not only include details about your business in the present — your management team and your mission statement, for example– but it should also serve as an outline for how your business will hit future targets.

Your business plan acts as a blueprint, outlining how your company will become successful and profitable. For that reason, your business plan won’t look exactly like the plan of another business — even one within the same industry. However, even though details may vary, there are a few common sections that can be found in all business plans. Those include:

  • Executive Summary: Describes the content of the business plan
  • Overview: Includes background of the business, legal structure, and other key details
  • Industry Analysis: Overview of the industry, including the size, nature, and any current trends
  • Competitive Analysis: Overview of your competition
  • Marketing: An outline of your marketing strategy and how you’ll reach customers
  • Operations Plan: Description of the operations of your business
  • Management: Bios and skills of your management team
  • Financials: An overview of current and future revenues

Your business plan not only helps you hit your goals, but it’s also critical when it’s time to obtain financing. Banks, nonprofit lenders, and even some alternative lenders may require a business plan as part of a loan application, especially for startup loans.

Pick Your Niche

While it may be tempting to try to cater for every event in your area, you’re going to stretch yourself thin … and likely set yourself up for failure. Instead of trying to offer services to everyone, pick a niche.

You may already have an idea in mind. For example, maybe it’s always been your dream to be a wedding caterer. Be sure to also consider the type of food you like to make. If you prefer to make salads, sandwiches, and other lighter fare, consider catering for business or school functions, luncheons, and other daytime events. If you prefer to serve fancier entrees, consider catering for weddings and special events.

Another step to take before selecting your niche is to do some market research in your local area. Where are there gaps in catering availability? What niche is overcrowded with the competition? You may find that there a large number of wedding caterers already in your area. Unless you can bring something new to the table (being the only caterer to serve Southern-style barbecue, for example), you might want to consider filling a different customer need.

There are a wide variety of catering niches to consider, including:

  • Weddings
  • Corporate Events
  • Adult Parties
  • School Events
  • Children’s Parties
  • Festivals
  • Sports Events

With an idea of your niche and the type of food you need to prepare, you can move into the next step: planning your menu.

Create Your Menu

KDS Kitchen Display System

Once you have a niche in mind, you’ll be able to narrow down your menu choices. Let’s face it — if you’re planning to focus on children’s parties or school functions, you won’t exactly need filet mignon on the menu.

You also want to consider what type of food you’re experienced at making. While you can certainly test out new ideas in the future, you want to put your best foot forward when starting out. You also want to offer a variety of options while keeping your menu at a manageable size. Having a menu with too many items or items that contain ingredients that are difficult to source could cause unnecessary stress for you and your clients.

It’s also important to remember those with dietary restrictions. Consider adding a few options to your menu that are vegetarian, vegan, gluten-free, or dairy-free to help expand your customer base.

Performing a test run or two can help you further improve your menu. Once you have your menu in place, test it out on a few friends and family members. Get their honest feedback on where you excel, as well as where you fall flat. Tweak recipes as needed, change techniques to become more efficient, and be honest with yourself about what works and what doesn’t. Then, alter your menu accordingly.

Source Your Ingredients

After you create your menu, you’ll have a better idea of the ingredients needed to prepare your food. When you first get your business off the ground, you may be able to get the ingredients you need by purchasing from a wholesale club in your area. However, as your business grows larger and you have more events to cater, you’ll want to purchase your ingredients from other sources.

You can get fresh produce from local farmers. Start building these relationships by visiting your local farmers’ market. You can also build relationships with restaurant suppliers and food service vendors to purchase bulk ingredients at reduced prices.

Calculate Startup Costs

In many states, you will be unable to use a residential kitchen to prepare your food. If you plan to cater from home, you must contact the health department in your area to find out more about the regulations of home-based catering businesses, including inspection and permit requirements.

In most cases, you’ll need to rent space for your kitchen. There are two ways to go about this.

The first is renting your own commercial space. This is the more expensive option but is a necessity if you plan to cater full time.

If you only plan to cater events occasionally or on weekends, you may be able to rent a commercial kitchen for a few hours on the days when you need it. This is a more affordable option since you won’t have to invest in equipment, but it’s not ideal for full-time caterers.

If you aren’t renting space in a kitchen that’s already stocked, you’ll also need industrial equipment that is used to prepare your food. Some of the items you’ll need include:

  • Commercial Ovens
  • Stoves
  • Deep Fryers
  • Sinks
  • Refrigerators
  • Walk-In Freezers
  • Mixers & Blenders
  • Pots & Pans
  • Knives
  • Cooking Utensils & Tools
  • Storage Containers
  • Dishwasher

You’ll also need equipment that you’ll bring on-site for serving and keeping food at the optimum temperature, including:

  • Serving Dishes & Trays
  • Serving Utensils
  • Chafing Dishes
  • Carving Stations
  • Grills
  • Heat Lamps
  • Soup Kettles
  • Beverage Dispensers
  • Coffee Station

An additional cost to add to your list is a catering van. This van will be used to transport your food and equipment to venues. You may save money initially by purchasing a used vehicle. However, you need to ensure that you know the complete history of the vehicle. You may also incur additional costs if your used vehicle needs repairs soon after purchasing it.

Some caterers also provide table settings, glassware, and utensils, but this adds to your initial investment. You may also provide additional items for your events, including chairs and/or chair covers, tablecloths, and centerpieces, but again, this will add to your startup costs.

Before starting your business, sit down and make a list of your total expenses. You can tailor the list to your own business. For example, if you don’t serve fried food, you won’t have to invest in deep fryers. If you specialize in only desserts, you may have pastry tools, cake displays and stands, and bakeware sets on your list.

Once you’ve made your list, start shopping around to get an idea of costs. Check out prices online or visit local commercial kitchen equipment and supply stores. Once you have an idea of how much funding you need, it’s a smart idea to add about 30% to those costs to prepare for the unexpected. For example, if you’ve priced everything at $100,000, apply for a loan of $130,000 to make sure all of your bases are covered.

Register Your Business

Before you begin catering to clients, you need to register your business with federal, state, and local agencies.

First, you need to think of a business name. Brainstorm ideas to find a name that’s catchy and is a reflection of your brand. When you’ve come up with a great name, check your Secretary of State’s website to ensure that this name is not already being used by another business.

Next, you will need to select your business structure. This is an important step because your business structure determines how your business is taxed and your personal liability for debts incurred by the business. The types of business structures include:

Sole Proprietorship

This business is owned and operated by one person. This is the easiest business structure and does not require registration. Setting up a sole proprietorship is easy. However, this structure does not provide you with any protection against the debts and liabilities of your business.

General Partnership

This type of legal structure is made for businesses with two or more owners. These are the easiest to create, have a low cost of operation, and the fewest requirements. No state filing is required for a general partnership.

Limited Partnership

This is another type of structure for businesses with more than one owner. General partners in a limited partnership have unlimited liability. The remaining partners – limited partners – have limited liability. In most cases, the personal assets of limited partners are protected from being used to satisfy the liabilities and debts of the business.

Limited Liability Partnership

This type of structure is designed for professional service businesses. Personal assets of any partner can’t be used to cover the debts and liabilities of the business. However, all partners in an LLP are liable for their own acts, such as medical malpractice.

Limited Liability Company

An LLC is separate from its owners. This type of legal structure protects owners from personal liability without the higher tax rates and stricter requirements of corporations.

Corporation

Owners in a corporation are protected from personal liability for the debts of the business. Corporations are the most difficult to set up. However, it is necessary to choose this business structure if you plan to sell stock or raise large amounts of capital in the future.

The type of business structure you choose for your catering business will vary based on the number of owners and your plans for the future. Consult with an accountant or attorney to learn more about your options and which is best for you.

After you choose your business structure, you will need to register with the state where you will operate. You can register through your state’s Secretary of State website. Application and fee requirements vary by state. If you plan to offer services in more than one state, you will need to register with each state.

Another important step in registering your business is obtaining an Employer Identification Number (EIN) from the IRS. This is a necessary step if your business will have employees now or in the future.

Get Permits & Licenses

After registering your business, it’s time to apply for the permits that you need to legally operate your business. It’s necessary to do this early in the game, as it may take weeks or even months to receive your required permits.

State and local laws surrounding permit and license requirements vary. Some of the permits and licenses you may need to legally operate your business include:

  • Business Licenses
  • Health Permits
  • Food-Handling Licenses
  • Liquor Licenses

You can contact the local health department, the state Alcoholic Beverage Control board, and other state and local agencies to learn more about the licenses required in your area, how to apply, and any applicable fees.

When working with food, you also face inspections from your local health department. The temperature of prepared and stored food, waste disposal, and the safety and condition of your cooking equipment are just a few of the things that will be inspected periodically.

Get Business Insurance

Protecting your catering business is important, and there’s no better way to protect yourself and your business than with business insurance. As a caterer, there are multiple insurance options to consider.

General liability insurance protects you from lawsuits that occur during events. This type of insurance covers physical injuries, property damage, and even damage to your reputation.

Another type of insurance to consider is errors and omission insurance, also known as E&O insurance. This insurance protects you from lawsuits that may be filed if a mistake is made. For example, if a client warns of an allergen and you include an ingredient that triggers an allergic reaction, this insurance would protect you from a potential lawsuit.

Property insurance should also be a consideration. This insurance protects your equipment, fixtures, and other property from damage or theft.

If you have employees, you will also need worker’s compensation insurance. This covers medical costs and lost wages from employees when they are injured or become sick. This also protects your business from lawsuits as a result of injuries.

If your business serves alcohol, you may also be required to carry liquor liability insurance, which protects your company from alcohol-related lawsuits.

Insurance requirements vary by state. Talk to your local insurance agent to find out more about the laws in your state and to create a personalized insurance policy for your new catering business.

Seek Business Funding

We’ve already reviewed many of the costs you’ll encounter when opening your own catering business. Now, it’s time to determine how to pay for those costs. Whether you have money in the bank or your bank account is looking a little slim, there are financing options available for you. Start your search with these options.

Personal Savings

If you’ve been putting away money into a savings account, now may be the perfect time to withdraw your funds. The great thing about personal savings is that you won’t take on debt with a lender. This means no payments, fees, or interest. The downside, though, is that if your business goes downhill, it may take your savings with it.

Friends & Family

Consider taking a loan from a friend or family member that’s willing to invest in a potentially lucrative new opportunity. Prepare your presentation, have your business plan in hand, and explain why your opportunity is worth investing in.

If you come to a mutual agreement, make sure to get everything in writing. It also goes without saying that this friend or family member should be treated like any other lender. That means paying back your loan as scheduled.

Instead of a loan, you may consider equity financing. In this scenario, your friend or family member would own part of your business. The major benefit is that you wouldn’t have to immediately start making loan payments. However, you would give over some ownership (and a slice of your future profits) and control over your business if you go this route. Undecided? Learn more about the pros and cons of debt vs. equity financing.

ROBS

If you have a retirement account, you may be able to leverage these funds for your new venture. Normally, if you withdraw before you reach a certain age, an early withdrawal penalty and income tax penalties apply. However, you can avoid these costs through a rollover as business startups (ROBS) plan.

A ROBS plan allows you to use your retirement funds for starting or expanding your business. Four steps are required to access your funds. First, a C-corporation is created. The next step is to create a retirement plan for the new C-corp. Then, you can roll over funds from your existing retirement account into your newly created plan. Finally, you will use these funds to purchase stock in your C-corporation, giving you access to the capital you need for your new business.

The process isn’t complicated, but there are rules you have to follow to ensure you maintain compliance. To take the guesswork out of ROBS, many aspiring business owners work with a ROBS provider. For a fee, ROBS providers will set up your ROBS account for you and will maintain it to ensure everything is done by the book.

Using your ROBS is a great way to fund startup costs. Other than a setup fee and a monthly maintenance fee charged by your ROBS provider, you do not pay additional fees. After all, you’re using your own money. However, if your business fails, you put your retirement funds at risk.

Recommended Option: Guidant Financial

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Guidant Financial can help you roll over your retirement funds into capital you can use for your catering business. In about three weeks, you can have the funds you need to start or grow your business with Guidant Financial’s ROBS plans.

To qualify, you must have a retirement account worth at least $50,000. Most retirement plans qualify, including:

  • 401(k)
  • 403(b)
  • Traditional IRA
  • TSP
  • SEP
  • Keogh

There are no credit score, time in business, or annual revenue requirements to qualify. However, you must have a business to fund, and you also must be an employee of that business in order to set up your ROBS plan.

Since you’re using your own funds, you don’t have to worry about monthly loan payments. However, you will have to pay a one-time setup fee of $4,995 followed by a maintenance fee of $139 per month to maintain your account.

In addition to ROBS plans, Guidant Financial also offers additional small business loan options including Small Business Administration loans and unsecured business loans.

Equipment Financing

As we discussed earlier, there is a lot of expensive equipment needed to start your catering business, from a catering vehicle to commercial kitchen equipment. A financing option to consider when you need new equipment is equipment financing.

With equipment financing, you can take possession of the equipment you need without paying the full cost up front. Instead, you’ll pay a down payment (typically 10% to 20% of the purchase price), then repay a lender in smaller, more affordable payments over time.

There are two main types of equipment financing to consider: equipment loans and equipment leases. With a loan, you’ll make a small down payment, then put the equipment into use immediately. You’ll make regular payments to the lender that are applied to the principal balance as well as interest and fees. Once you’ve repaid the loan as agreed, the equipment is yours to keep, sell, or trade.

The other type of equipment financing is an equipment lease. You’ll also pay a down payment and regular payments. However, at the end of your lease, you return the equipment. At this time, you can sign another lease for new equipment. This is a better option if you plan to upgrade your equipment frequently, although this option can be more expensive over the long term.

With equipment financing, you typically do not have to put up collateral. Instead, the equipment being financed is the collateral and can be seized by the lender if you don’t make your payments as agreed.

Recommended Option: Lendio

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Lendio’s network of over 75 lenders can provide you with up to $5 million to finance your equipment. Loan terms are between 1 to 5 years with rates starting at 7.5% for the most qualified borrowers. With some lenders, you can get your funding in as little as 24 hours. Some applicants may even qualify for 0% down financing.

To qualify for equipment financing, you must meet the following requirements:

  • At least $50,000 in annual revenue
  • Personal credit score of 650 or above
  • Time in business of at least 12 months

If you have credit challenges, you may still qualify provided you have proof of solid cash flow and revenue for at least 3 months.

The funds can be used to purchase the equipment you need for your catering business, including but not limited to commercial kitchen equipment, office furniture and fixtures, software, appliances, and commercial vehicles.

If you don’t qualify for equipment financing through Lendio’s network, you can shop around for other financing options. Through Lendio, you can apply for financial products including SBA loans, business credit cards, lines of credit, and startup loans.

Lines Of Credit

Running your own catering business comes with its challenges. Some challenges are expected — rushing around to cater a big wedding, for example — while others come when you least expect it. Whether it’s a slow season that has impacted your incoming cash flow, equipment that needs repairs, or an unforeseen emergency, even the most successful business face the unexpected.

For these times, it’s great to have a backup plan, like a flexible line of credit. A line of credit is different from a traditional loan because you don’t receive one lump sum that you immediately start repaying. Instead, a lender assigns you a credit limit — much like a credit card — and you can withdraw money from your line as needed.

Your line of credit is ready to use whenever you need it. You don’t have to immediately draw funds if there’s no need, and most lenders don’t charge fees if you don’t use your line of credit. When you do use your line of credit, you’ll repay your balance plus any fees and interest charged by the lender. Since this is a revolving form of credit, funds will be replenished and available to use again as you pay off your balance.

Recommended Option: Fundbox

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Fundbox offers lines of credit that can be used for any business purpose. One of the standout features of Fundbox is that the lender looks at the performance of your business — not just your credit score. Even if you’ve been turned down by other lenders in the past, you may still qualify for a Fundbox line of credit.

Through Fundbox, you may qualify for up to $100,000. Once approved, you can immediately make draws on your account. Repayment terms are 12 or 24 weeks, and rates start at just 4.66% of the draw amount. Weekly repayments are automatically deducted from your business checking account. There are no prepayment penalties, all remaining fees are waived if you pay off early, and there are never any fees if you don’t make a draw.

To qualify, you must meet the following minimum requirements:

  • At least $50,000 in annual revenue
  • Holder of a business checking account
  • At least 2 months of activity in accounting software OR at least 3 months of transactions in a business bank account

Business Credit Card

Another source of financing that’s great for covering unexpected expenses is a business credit card. A business credit card works just like your personal card. You can use your card online and in stores to make purchases anywhere credit cards are accepted. When you use your card, the lender charges interest on the borrowed portion of funds. If you don’t use your card, you aren’t required to pay interest. However, annual fees and other charges may apply.

Business credit cards are great for emergencies or for quickly resolving cash flow issues. You can also use your credit card for recurring expenses, such as gas for your catering van. If you go this route, apply for a low-interest rewards card that gives you cash back or other perks just for using your card.

Recommended Option: Chase Ink Business Cash

Chase Ink Business Cash



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Annual Fee:


$0

 

Purchase APR:


15.49% – 21.49%, Variable

With Chase Ink Business Cash, you can earn rewards just for using your card to pay for your business expenses. Using this card gets you 5% cash back on the first $25,000 spent at office supply stores and on internet, cable, and phone services. You can earn 2% cash back on the first $25,000 used at gas stations and restaurants. These offers renew each year on your account anniversary. For all other purchases, you can earn unlimited 1% cash back.

New cardmembers can take advantage of a $500 cash back bonus offer when $3,000 is spent within 3 months of opening an account. This card also comes with additional benefits including purchase protection, extended warranty protection, and free employee cards.

There is no annual fee for the Ink Business Cash credit card, and it comes with a 0% introductory APR for the first 12 months. After the introductory period, the card has a variable APR of 15.49% to 21.49%.

This card is recommended for borrowers with good to excellent credit scores.

Vendor Financing

As a caterer, you’ll establish relationships with vendors. You’ll purchase your ingredients, supplies, and other necessary items from these vendors. Many times, you’ll purchase these items up front. Other times, however, you may need a little help in the form of vendor financing.

With vendor financing, a lender will pay your vendors up front so you can get the supplies necessary for running your business. You’ll then be able to spread your purchase out over several smaller payments. Like other financial products, you’ll pay fees and/or interest for the convenience. While the cost of borrowing may be higher than making a purchase up front, the extra expense may be well worth the cost if you’re in a financial bind.

Recommended Option: Behalf

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You can pay your vendors immediately without putting up the money up front by working with Behalf. Through Behalf, you can get up to $50,000 to pay your vendors. Then, you have up to 6 months to repay the lender.

Monthly fees start at 1% of the borrowing amount and are based on your creditworthiness. There are no origination fees, membership fees, or other hidden costs to borrow from Behalf.

There are no time in business, annual revenue, or credit score requirements to qualify. However, Behalf will perform a hard pull on your credit once you submit your application.

Personal Loans For Business

You have a solid credit score, but small business lenders won’t even give you a second glance. What gives?

Many small business loans have time in business and annual revenue requirements. This is fine when your business is already operating, but what do you do when you need a loan before you even open your doors? Try applying for a personal loan for business.

As a startup, you may find it challenging to qualify for a small business loan. However, you can use your own personal credit score and income to qualify for a personal loan that is used for business expenses.

These loans don’t have time in business, annual revenue, or business credit score requirements, so you can qualify even if you’ve not yet catered a single event. Personal loans are available for a wide range of credit scores. However, having a high credit score can help you qualify for the best interest rates and terms.

Recommended Option: LendingPoint

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LendingPoint specializes in personal loans, offering qualified borrowers $2,000 to $25,000. Rates range from 9.99% to 35.99% with repayment terms of 24 to 48 months. An origination fee of 0% to 6% of the borrowing amount may apply. Payments are made twice per month.

You can quickly and easily qualify for a LendingPoint personal loan. To receive an offer in just minutes, you need:

  • Proof of employment & income
  • Bank statements
  • Voided check
  • Driver’s license or government-issued ID

To qualify for a loan, you must:

  • Be at least 18 years old
  • Have a social security number
  • Have at least $20,000 in annual income
  • Have a verifiable bank account
  • Live in a state serviced by LendingPoint
  • Have a credit score of at least 585

Choose The Right Software

pos with raw ingredient tracking

From keeping track of events to accepting credit cards, the right software can help you do it all. As a caterer, there are several types of software you should consider investing in to keep operations running efficiently.

Accounting Software

This software allows you to perform functions such as tracking expenses, sending invoices to clients, managing payroll, and keeping up with inventory. With accounting software, you can keep up with your financials and run reports, which is especially helpful when you’re seeking financing from a bank or traditional lender. Accounting software also makes it easier for your business when tax time rolls around.

New to accounting? Download our free eBook, The Beginner’s Guide to Accounting.

Catering Software

There are specific software programs designed to help caterers manage all aspects of their businesses. Features include invoicing, billing, employee scheduling, event bookings, and other tools to keep your catering business on track.

Payment Processing Software

Not all of your clients will have cash, especially when they’re paying off large bills for their catering expenses. To make payments easier for your clients, invest in payment processing software. This software acts as the communicator between your bank and your customer’s bank, allowing you to accept debit cards, credit cards, and other methods of payment. Most payment processing software comes with monthly subscription fees, and some companies even offer free hardware that makes it easier than ever to accept multiple forms of payment.

Hire Employees

When you first start your business, you may be a one-man operation until you start bringing in revenue. However, you will eventually need to hire employees if you want to grow and scale. If you’re like many caterers, you may opt to hire an employee or two right from the start.

Employees that you may hire for your business — either now or in the future — include:

  • Chef: Your chef will be in charge of preparing the food. For large events, consider hiring sou chefs for additional assistance.
  • Servers: Bring food and drinks to guests
  • Bartenders: Serve alcoholic beverages to guests
  • Busboys: Responsible for clearing off tables
  • Host/Hostess: Help guests find their seats
  • Event Planner: Meets with the client to discuss details about the event
  • Supervisor: Ensures that other staff members are doing their jobs efficiently

Until your business grows and brings in revenue, you may opt to hire just a few staff members, such as a chef and a server. As your business gains more customers and becomes profitable, you can add additional employees to your staff.

Do your research to get an idea of the average pay range in your area for each position. It’s also important to remember that other expenses come with hiring staff, including workman’s compensation insurance, training costs, and benefits.

To find employees for your business, ask friends, family members, and colleagues for referrals. You may also post a job advertisement on online job boards. You can even contact local temporary agencies to find the help you need.

Bolster Your Web Presence

Your plans for a catering business are coming together, so now it’s time to start thinking about how you’re going to bring in clients. There’s no better place to start than the internet.

Just think about it. If you’re looking for a local company to work with, where is one of the first places you look? The internet, of course.

You can quickly build your web presence with these easy steps.

Launch Your Social Media Profiles

Social media is a great way to reach new customers, and best of all, setting up your profiles is free! Create business pages on Facebook, Twitter, Instagram, and/or Pinterest. Make sure to include critical details such as your contact information, service areas, and types of events catered. You can build up your profiles to include information such as menus, pricing lists, and photos of your food and past events.

An added bonus on social media is that you can communicate with potential customers through comments or direct messaging.

As you begin to grow your business, you can later invest in social media ads, but in the beginning, focus on getting your profiles up and running.

Want to get the most out of your social media profiles? Check out our Guide to Social Media Marketing.

Build Your Website

In addition to your social media profiles, you also need to build a website. This doesn’t have to be overly complicated. In fact, there are lots of website builders that make it easy to choose a template, customize your font and colors, and drag and drop images, text boxes, and tools — no design experience required.

Make sure that the design of your website reflects your branding. You also want to include important details, including the name of your business and contact details. You can also add additional features and information, including a live chat option, photo galleries, and reviews and testimonials.

Advertise Your Business

Boosting your web presence is a great start to advertising your business, but make sure that you don’t stop there. There are several ways that you can advertise your business — both online and off.

Fliers

Pass out or hang flyers advertising your catering services throughout your area. Make sure that you understand the regulations in your area surrounding posting and/or distributing flyers.

Online Ads

Purchase ad space on Facebook, pay-per-click ads on search engines, or even post advertisements on local online forums and social media groups.

Newspaper Ads

This is an oldie but goodie: pay for ad space in your local newspaper.

Attend Wedding Shows

Many cities and towns have bridal shows where vendors can advertise their services. Research events in your area, rent booth space, and advertise your business in-person to newly engaged couples.

Wedding & Event Websites

Submit your business information to wedding and event websites to draw in new customers.

Word-Of-Mouth

Word-of-mouth advertising is the best form of advertising. Ask your past customers for testimonials and reviews, and always make sure to go above and beyond to provide exceptional service.

Final Thoughts

Starting your own catering business is exciting but venturing out on your own can also be a little scary, especially if you lack business experience. However, you can be on track to owning and operating a successful catering business with careful planning, preparation, and strategic borrowing. Good luck!

The post How To Start And Fund A Catering Business: The Step-By-Step Guide appeared first on Merchant Maverick.

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The Best Business Loan And Financing Resources For Colorado Small Businesses

Colorado is one of the fastest-growing states in the nation. Not only is its population burgeoning, but its economy is flourishing and only expected to grow into the future. Professional and business services, the tech industry, and agriculture are among the sectors that will continue to bring new jobs and contribute to the state’s economy.

It isn’t just big business that’s helping the economy grow, either. Small businesses play an extremely important role throughout the state. Unfortunately, these smaller businesses — businesses just like yours — may struggle to find the financing and resources they need to be successful.

The good news is that there are plenty of financing options available to small business owners. The key is knowing where to find them. Instead of spending hours wading through lenders, scratching your head over interest rates and terms, or struggling to get the capital you need, keep reading this post — we’ve taken the guesswork out of small business financing. From online and traditional lenders to grants and more, read on to learn about the resources available to Coloradans.

Online Business Lenders For Colorado Businesses

You probably already use the internet for business — from communicating with clients and suppliers via email to placing orders for inventory and paying utility bills. Why not use it to find financing for your business?

Online lenders make it more convenient than ever to apply for small business loans and financing. You can fill out your application, submit your documentation, and even receive funds in your bank account — all without ever leaving your home or office.

It’s possible to get the financing you need in as little as 24 hours by working with an online lender. Even if you’ve had trouble qualifying for financing in the past, there are online options available to you. Start by checking out these recommended lenders.

Lendio

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Lendio makes shopping around for financing easier than ever. A single application connects you with over 75 lending partners, allowing you to compare rates and find the most affordable financing options in just minutes. Applying with Lendio is free, there’s no obligation, and your credit score isn’t affected by checking your offers.

No matter what type of small business financing you need, you can connect with the right lender through Lendio. Financial products available through Lendio include:

  • Small Business Administration (SBA) Loans: $50,000 to $5 million
  • Term Loans: $5,000 to $2 million
  • Short-Term Loans: $2,500 to $500,000
  • Lines Of Credit: $1,000 to $500,000
  • Equipment Financing: $5,000 to $5 million
  • Commercial Mortgages: $250,000 to $5 million
  • Accounts Receivable Financing: Up to 80% of receivables
  • Startup Loans: $500 to $750,000
  • Business Credit Cards: $1,000 to $500,000
  • Merchant Cash Advances: $5,000 to $200,000

Rates, terms, and borrower requirements vary. You may receive your funds in as little as 24 hours based on the product you select.

SmartBiz

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If you don’t qualify for a low-interest bank loan, there may be an alternative: Small Business Administration loans.
The SBA guarantees a portion of the loans provided through its various loan programs, so lenders feel more confident in financing small businesses. Meanwhile, you’ll get the benefit of a low-interest, long-term loan, even if you’ve been turned down by banks and traditional lenders in the past.

Navigating the SBA application process can be a challenge, but SmartBiz has simplified it through its online marketplace. You can prequalify in minutes, receive funds quickly, and easily move through the SBA loan process by working with SmartBiz.

Through SmartBiz, you can apply for a loan used for working capital or to refinance debt. Loans are available for $30,000 to $350,000 with interest rates of 8.25% to 9.25%. Repayment terms are up to 10 years.

Funds for these loans can be used to refinance existing debt, purchase inventory or equipment, launch a marketing campaign, hire new employees, or cover operating expenses. Loan funds can’t be used to pay unpaid taxes.

To qualify for this loan, you must meet these minimum requirements:

  • At least 2 years in business
  • U.S. citizen or legal permanent resident
  • Personal credit score of 640 or above
  • Cash flow to cover loan payments
  • No bankruptcies or foreclosures within 3 years
  • No defaults on government-backed loans
  • No outstanding tax liens

If you want to purchase, expand, or refinance your commercial property, you can apply for an SBA 7(a) commercial real estate loan. Through SmartBiz, you can apply to receive $500,000 to $5 million with interest rates of 7% to 8.25%. Repayment terms are up to 25 years.

These minimum requirements apply to all borrowers:

  • At least 51% of the property is occupied & used by your business
  • Time in business of at least 3 years
  • Personal credit score of 675 or above
  • Cash flow to cover loan payments
  • Purchase price exceeds $500,000
  • U.S. resident or legal permanent resident
  • No bankruptcies or foreclosures within the last 3 years
  • No outstanding tax liens
  • No defaults on government-backed loans

Funds from these loans can’t be used to purchase investment properties or to fund new construction costs.

OnDeck

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OnDeck offers two loan options for small business owners in Colorado: term loans and lines of credit. Let’s start off by looking at the options for OnDeck’s term loans.

With a term loan, you can receive a lump sum in amounts up to $500,000. OnDeck offers short-term loans with terms of 3 to 12 months and simple interest rates starting at 9%. This means that your interest rate is a percentage of your loan amount. If you borrow $20,000 at a simple interest rate of 9%, you’ll pay $1,800 in interest — or a total of $21,800 before any additional fees are applied.

Short-term loans are best for projects with an immediate return, such as seasonal hiring, inventory purchases, or launching a marketing campaign.

OnDeck also offers long-term loans. These loans have terms of 15 to 36 months with annual interest rates starting at 9.99%. Long-term loan funds are best for expanding your business, making large-scale inventory purchases, or buying equipment.

To qualify for a term loan, you must have:

  • Time in business of at least 1 year
  • At least $100,000 in annual revenue
  • Personal credit score of 500 or above

If you want a more flexible form of financing, apply for OnDeck’s line of credit. You can receive up to $100,000 with APRs starting at 13.99%. A line of credit is best for filling revenue gaps or paying unexpected expenses.

You only pay interest on borrowed funds, and payments are made each week through automatic deductions. A $20 monthly maintenance fee is required but will be waived for 6 months if you draw at least $5,000 within 5 days of opening your account. There are no draw fees for using your line of credit.

To qualify for a line of credit, you must meet these requirements:

  • Time in business of at least 1 year
  • At least $100,000 in annual revenue
  • Personal credit score of 600 or above

Breakout Capital

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Breakout Capital provides qualified small business owners with up to $250,000 with its small business loans. Daily, weekly, and monthly repayment terms up to 2 years are available. Breakout Capital loans have a fee of 1.25% to 3.5% of the borrowing amount each month.

To qualify for a small business loan, you must have:

  • A time in business of at least 1 year
  • A personal credit score of 600 or above
  • At least $10,000 in monthly revenue

If you need more capital, you may want to consider FactorAdvantage. This service combines invoice factoring and a business loan to provide qualified borrowers with up to $500,000. Fees start at 1.25% of the borrowing amount per month, and repayment terms are available up to 2 years.

If neither of these options seem right for you, Breakout Capital’s lending experts can connect you with other financing options including:

  • SBA 7(a) Loans
  • Equipment Leases
  • Merchant Cash Advances
  • Lines Of Credit

Fundbox

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If you want a fast, flexible line of credit that you can access in just minutes, take a look at what Fundbox has to offer.
You can qualify for a line of credit up to $100,000 when you apply with Fundbox. Repayments are made over a 12- or 24-month period, and payments are automatically withdrawn from your business bank account each week.

Fees for using your Fundbox line of credit start at just 4.66% of the draw amount and are based on the performance of your business. If you don’t use your line of credit, you never pay any fees. As you repay your line of credit, funds are replenished and become available to use again.

Fundbox has a fast and easy application process with minimum borrower requirements. To qualify, you must have:

  • Business checking account
  • At least $50,000 in annual revenue
  • At least 3 months of transactions from your business bank account OR at least 2 months of activity in accounting software

Amex Merchant Financing

American Express OptBlue

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If your small business accepts American Express, you may qualify for a business loan up to $2 million with American Express Merchant Financing.

One of the best things about Amex Merchant Financing is you don’t have to worry about confusing interest rates or fees. Instead, you pay one fixed fee for your loan. Fees are based on the terms you select and range from 1.75% to 20% of the borrowing amount. If you repay your loan early, you could receive a rebate of up to 25% of your fee.

Repayment terms of 6, 12, and 24 months are available. A fixed amount will be automatically deducted from your bank account each business day to repay your loan.

Borrowers must meet the following requirements to qualify:

  • Accept American Express Cards
  • Have at least $12,000 in annual credit & debit receivables
  • Have at least $50,000 in annual business revenue
  • Have a time in business of at least 2 years

Credibly

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Credibly is a lender that doesn’t have a one-size-fits-all solution for small businesses. Instead, this lender offers three products to give small business owners the capital they need: working capital loans, business expansion loans, and merchant cash advances.

A working capital loan is ideal for covering operational expenses and fueling business growth. Under this program, you may qualify for up to $400,000 that can be repaid over terms of 6 to 18 months. Automatic payments are withdrawn from your account daily or weekly.

Instead of a traditional interest rate, these loans come with factor rates that start at 1.15. Learn more about how factor rates affect the cost of your loan.

The requirements for a Credibly working capital loan are:

  • Personal credit score of 500 or above
  • Time in business of at least 6 months
  • At least $15,000 in average monthly bank deposits

If you’re ready to expand your business, consider applying for Credibly’s business expansion loan. You can receive up to $250,000 with terms of 18 or 24 months. Repayments are automatically deducted each week. Interest rates for these loans start at 9.99%.

For Credibly’s business expansion loans, you must have:

  • A personal credit score of 600 or above
  • Time in business of at least 3 years
  • At least $15,000 in average monthly bank deposits
  • At least $3,000 in average daily balances

The final option that may work best for you is a merchant cash advance, or MCA. Credibly purchases a percentage of your future receivables. Daily remittances are made until your loan plus any applicable fees are repaid. The estimated duration of this type of financing is 3 to 18 months.

With this type of financing, you can qualify for up to $400,000. Factor rates start at 1.15.

Requirements for a Credibly MCA are:

  • Personal credit score of 500 or above
  • Time in business of at least 6 months
  • At least $15,000 in average monthly bank deposits

Upstart

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Having trouble finding a low-interest loan option? Consider using your own personal credit score and income to qualify for a personal loan for business. Whether you’re operating a brand new business or you can’t meet the requirements of small business lenders, getting a personal loan could be the hassle-free, affordable option you’re looking for.

Upstart is an online lender that offers personal loans that you can use for your business expenses. You can borrow between $1,000 and $50,000 with APRs starting at 8.09% for the most qualified borrowers. Don’t have perfect credit? It’s no problem. You can still qualify for a loan with APRs up to 35.99%.

One of the unique things about Upstart is that the lender considers more than just your credit score when approving your loan. Upstart looks at overall credit history, area of study, job history, and education to determine if you qualify for a loan.

To qualify for an Upstart personal loan, you must meet the following minimum requirements:

  • A source of income
  • Personal credit score of 620 or above
  • No bankruptcies or public records
  • Less than 6 inquiries within the last 6 months on your credit report
  • A solid debt-to-income ratio

Banks, Credit Unions, & Nonprofit Lenders In Colorado

If you’d rather work with a traditional lender, there’s no shortage of them in Colorado. Work with your own bank or credit union, or consider one of these options for your business financing.

Bank Of Colorado

The Bank of Colorado has branches located all throughout the state, including cities like Akron, Colorado Springs, Fort Collins, and Denver. The Bank of Colorado offers multiple financial products for small business owners. In addition to business checking and savings accounts, you can apply for:

  • Business Credit Cards
  • Business Loans
  • Lines Of Credit
  • Agriculture Loans & Lines Of Credit
  • Equipment Loans
  • Real Estate Loans
  • Livestock Loans

Bank of Colorado also offers merchant card processing, employee benefits, and other small business services. Visit your local branch to apply for Bank of Colorado’s small business banking services.

Ent Credit Union

Ent Credit Union was founded in 1957 and has grown to over 30 branches throughout the state with more than 330,000 members. Service centers can be found in cities including Aurora, Denver, Colorado Springs, and Parker.

You can apply for small business checking, savings, and money market accounts. If you need extra capital for your business, you may also qualify for one of Ent’s financial products including:

  • Business Auto Loans
  • Business Credit Cards
  • Lines Of Credit
  • Commercial Real Estate Loans
  • Business Term Loans
  • Equipment Loans
  • SBA 504 Loans

To apply for any type of financing, you must be an Ent Credit Union member. To qualify for membership, you must meet one of the following requirements:

  • Live, work, attend school, or worship in one of the counties served by Ent
  • Be civilian or military personnel of the Colorado Air National Guard or Colorado Army National Guard
  • Be associated with Buckley Air Force Base
  • Have a family member that is a member of Ent

You can sign up for membership online, by phone, or through a service center.

Colorado Enterprise Fund

Colorado Enterprise Fund is a nonprofit lender that specializes in lending to small businesses that may not qualify for traditional financing. Since 1976, this lender has closed over 2,000 loans for small business owners in Colorado.

There are multiple financing options available through the Colorado Enterprise Fund, including:

  • Dream Big Microloans: Up to $50,000 with terms up to 7 years
  • Step Up Loans: Up to $500,000 with terms up to 10 years
  • Healthy Food Loans: Up to $500,000
  • Valor Loans For Veterans: Up to $500,000 with terms up to 10 years
  • SBA Community Advantage Loans: Up to $250,000 with terms up to 25 years
  • Just In Time Lines Of Credit: Up to $100,000 with terms up to 2 years
  • GAP Loans: Up to $500,000 with terms up to 25 years
  • Commercial Real Estate Loans: Up to $500,000 with terms up to 7 years

Startups and existing businesses may be eligible to receive funding. Colorado Enterprise Fund will evaluate several factors when determining whether to approve an application, including:

  • Personal Credit Score
  • Equity
  • Industry Experience
  • Payment History
  • Cash Flow & Profitability
  • Collateral

The online application and all requirements can be found on the Colorado Enterprise Fund website.

Small Business Grants In Colorado

startup grants

Nothing in life is free … or is it? If you qualify for a small business grant, you could get the financing your business needs without having to repay the funds. No interest rates, no debt, no problem, right?

Unfortunately, many small business owners find that the process of finding, qualifying for, and receiving a small business grant is extremely difficult. Even if you meet the stringent criteria, you’ll have to compete with many other small business owners.

This doesn’t mean that you should just forget about small business grants. If you qualify, you certainly should take the time to apply. However, just understand that you also need to consider other sources of capital for your business.
In the state of Colorado, there are several grant opportunities available to small business owners. Get started with these options.

LEADING EDGE For International Opportunities

Leading Edge for International Opportunities is a grant program administered by the Colorado Office of Economic Development and International Trade. The proceeds from these grants are used for covering the costs of export projects. Minority, veteran, and women-owned businesses are eligible to apply.

Through this program, grant recipients can receive up to $10,000 to pay for costs associated with international business development and marketing projects, including foreign trade show exhibition and conference costs, advertising in overseas industry trade publications, and foreign business-to-business matchmaking services.

To qualify, businesses must meet the following requirements:

  • Employ fewer than 100 employees globally
  • Headquarters in Colorado OR at least 50% of employees based in Colorado
  • Registered with the Colorado Secretary of State
  • At least 51% ownership by minorities, veterans, or women
  • Time in business of at least 1 year

All information and the online application are available through the Colorado Minority Business Office.

Colorado First & Existing Industry Customized Job Training Grant Program

The Colorado First & Existing Industry Customized Job Training Grant Program is open to new or existing Colorado businesses. Through this program, grant funds can be used for training permanent, full-time employees. Businesses can receive up to $1,400 per eligible employee.

There are several requirements a business must meet to receive this grant, including:

  • Contributions of at least 40% to the total costs of grant-funded training
  • Must pay at least $13 per hour in urban counties and at least minimum wage in rural counties
  • Must offer health insurance to employees

To learn more about this grant and to apply, you must contact a CFEI college representative through the Colorado Community College System website.

Colorado Creative Industries Grants

Colorado Creative Industries offers multiple grant opportunities for small businesses and entrepreneurs. One of the most notable grant programs is the Career Advancement Grant. Through this program, you can receive matching funds up to $2,500 to stimulate a commercial creative business.

To qualify for this grant, you must meet these requirements:

  • A resident of Colorado
  • At least 18 years old
  • Have a creative sector business
  • Received no funding from CCI within 12 months of the application deadline

An online application for this grant and information on additional funding programs is available on the Colorado Creative Industries website.

Loans & Resources For Startups In Colorado

You have your business plan in place, you’re motivated and focused, and you’re ready to launch your new business. There’s just one thing missing from the entrepreneurial equation: capital.

Getting a loan through your bank or even alternative lenders can be a challenge for startup businesses. But don’t let that get you down because there ARE options available to you if you know where to look.

Start your search for funding with these organizations. In addition to funding, you’ll also have access to loads of resources including business training, one-on-one consultations, and educational materials to help you start and operate a successful small business.

Colorado Small Business Development Center Network

If you need business consulting, look no further than the Colorado Small Business Development Center Network. There are more than 80 centers located throughout Colorado that offer free one-on-one consulting on topics including:

  • Marketing
  • Financial Assistance
  • QuickBooks
  • Business Plan Writing
  • Certifications
  • Social Media Strategies

Workshops, scholarships, strategic planning courses, eLearning videos, and special events are also offered through the Colorado SBDC Network. Visit the official website or your local center for more information on the resources available to small business owners.

SCORE

Whether you need help starting your own business or advice for your existing business, check out SCORE to connect with a business mentor. You’ll receive free advice online, over the phone, or at a SCORE office near you.

Mentorships aren’t all that SCORE has to offer. You can also sign up for workshops, classes, and webinars. SCORE also has a large library of business resources to access. All services are available for free or for a low fee.

In Colorado, there are several offices throughout the state in cities including Denver, Colorado Springs, and Pueblo. You can call or visit your local office or go online to request a mentor.

What To Consider When Choosing A Lender

As you can see, there are plenty of small business financing options and resources for Coloradans. However, narrowing down your choice to just one is still a daunting task. Whittle down your choices by considering the following:

Does The Lender’s Products Fit My Needs?

One of the first steps you should take before seeking financing is to determine what product works best for you. If you want capital that’s available when you need it, work with a lender that offers business credit cards or lines of credit. If you need a large amount of capital, find lenders that offer long-term, low-interest loan options. By determining what type of financing works for your business beforehand, you can eliminate lenders that don’t offer the financial products you need.

Do The Rates & Terms Work For Me?

Shop around to compare rates and terms of lenders that are at the top of your list. Would you rather make one monthly payment? Cross off the lenders that require weekly, daily, or bi-weekly payments. Have a good credit score? Avoid lenders that specialize in financing to less creditworthy borrowers, since interest rates will often be much higher.

Always take the full cost of financing into consideration, including additional fees charged by the lender. Then, analyze your other business debts. You should ensure that your business can comfortably afford to take on additional debt before signing on the dotted line.

Will The Funding Be Enough For My Business?

How much capital do you need for your business? Once you’ve determined the amount you’re seeking, you can narrow down your list of lenders. If you need $100,000 to purchase new equipment, a lender with loans that max out at $50,000 won’t cut it. Calculate how much you need to borrow, then select a lender that can meet your financial needs.

Do I Meet The Lender’s Requirements?

Before you apply for financing, check your credit score, understand any negative items on your credit report, and have a grasp of the financials of your business. Most lenders look at factors including personal and business credit scores, personal and business credit history, time in business, and annual revenue. If you fall short with one lender, find a lender with requirements you can meet.

One last thing to note is that if you’re unable to meet the criteria of multiple lenders, it may be time to evaluate if now is the right time for financing. Break down your finances, work to build up your credit score, and explore all financial options before signing on to a high-interest loan with unfavorable terms.

Final Thoughts

Building a business is never easy. However, with the many resources available to Coloradans, you can increase your chances for success whether you’re just getting started or you’re ready to expand your business. Always do your research, consider all options available to you, and take the time to determine what steps to take next to best benefit your business.

The post The Best Business Loan And Financing Resources For Colorado Small Businesses appeared first on Merchant Maverick.

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