Women wanting to start bussiness Grants ? government loans?

Question

I would like to know if any one out there has recived a government loan to start a bussiness ? how hard was it and how long did it take . Grants also Same question any other advice is welcome Thank you

Answer 1

Government loans for starting a business through the Small Business Administration http://www.sba.gov/financing is not that easy to get as they consider various factors:

- A business plan explaining what the business is

- Your equity investment - you need to show them that you have money invested in the business and often they want about 20% (SBA won't give you 100% of the amount you need)

- Your background and experience in the business -- in my experience, this is KEY in the eyes of the bank because they want to make sure that you know what you are doing and that you can make the business work. If you don't have any experience with the business, have someone on board that knows the business to give banks assurance that someone will guide you

- Your credit factors because it shows your dependability and how well you handle credit. They will do a credit check on you and poor credit history may be frowned upon, or even reason for the disapproval of your loan application

- Your collateral. Banks, even SBA guaranteed loans, want the borrower to show collateral. They want to be guaranteed that somewhere somehow they can get payment from you

- Condition or terms of loans. Banks would want to know three important things: "How much money are you requesting? What will it be used for? and For how long will it be needed?" Banks oftentimes prefer to approve loans for items that can be identified, has lasting value, and can be repossessed and sold if things fail.

As for grants, it is hard to find grants to start a business. Unlike the myths that some perpetuate, federal government and even private foundations hardly give grant money for starting a for-profit business.

Even SBA does NOT give out grants. From the SBA website http://www.sba.gov/mostrequesteditems/CON_FAQ2.html

"The U.S. Small Business Administration does not offer grants to start or expand small businesses, although it does offer a wide variety of loan programs. (See http://www.sba.gov/financing for more information) While SBA does offer some grant programs, these are generally designed to expand and enhance organizations that provide small business management, technical, or financial assistance. These grants generally support non-profit organizations, intermediary lending institutions, and state and local governments."

Nonetheless, you can go to the Catalog of Federal Domestic Assistance (CFDA) http://www.cfda.gov and Grants.gov http://www.grants.gov - these are two sites created by the federal government to provide transparency and information on grants. Browse through the listings and see if you can find any grant that would support a for-profit venture.

For private grants, you may want to check the Foundation Center's Foundation Grants for Individuals Online http://gtionline.fdncenter.org . It's a subscription based website ($9.95 per month) but their opening blurb only says that the database is ideal for "students, artists, academic researchers, libraries and financial aid offices." Entrepreneurs are apparently not one of them, so I take it they also don't have listings of private foundations who give grants to would-be entrepreneurs.

Answer 2

There are essentially only 3 sources for grants.

Federal grants are called Small Business Innovation Research grants. These are given primarily for some new innovation. You can find out what's available at:
http://www.sbirworld.com
There is also info on this site about how to apply.

Some cities offer grants to small businesses if they will locate in the downtown area, for the purposes of building up downtown traffic. Check with City Hall.

Finally, private foundations offer grants. You can get a list of most US Foundations and private grant sources at http://www.foundations.org/grantmakers.html.

Answer 3

Might find some loans. GOvernment doesn't give GRANTS to start businesses no matter what the commercials say.

Loans; try the SBA and local community development

Answer 4

Great answer by imisidro. I'll just add one thing. Go to the website for My Own Business, Inc. (MOBI)
http://www.myownbusiness.org/
It is a free resource started in 1992 by Phil Holland (famous entrepreneur) after the LA riots to help people rebuild their community by opening small businesses. Most people did not have any business experience and very few assets to borrow money. It has GREAT free online courses and a step-by-step guide to help you write a business plan (which you will need to borrow money).

I am a business owner (8 years) and I wish I knew about this resource when I started up. Now I refer back to it for added guidance.

Best of luck.

Answer 5

From what I hear they're few and far between. The best I've found is a place that uses government incentives to guarantee loans based on your business plan alone.