Funding through College Business Development Centers
Grants from colleges are usually in the $5,000 range, due to their limited funding. Since these institutions are academic in nature, they also provide a large degree of training for small business owners on various topics. Courses can include anything from business plan development, financial statement preparation, choosing a board of directors, marketing, government contracting and more. Some even provide annual conferences to help you network and grow your business. They also allow small businesses to become vendors at their annual events. You can search with local colleges in your area to find out if they house one of these centers.
Micro grants from community organizations are usually $10,000, and typically have a matching requirement. This means that if you are awarded $10,000, then you must come up with an additional $10,000 to operate your business. You must have banking documentation to prove the availability of these funds as well. Your proposal must outline how you plan to spend the money. It cannot be spent to pay off debts. You must spend the funds on economic development activity, such as, web site development, marketing, new ad campaigns, financial management system upgrade, etc. You can search for these organizations through your local municipal offices, political organizations and chambers of commerce.
Community Development banks typically give up to $100,000 to small businesses in loan funding, if they qualify. Since most community banks receive funding support for small businesses from the federal government, they tend to have a larger budget. Applying for this kind of funding, however, is not the simplest task. A loan package has to be prepared and submitted to apply for these funds. The package includes a business plan, 5-Year Business Financial Forecast, Company Balance Sheet, 1 – Year Profit and Loss Statement, personal financial statements, credit history, loan application and cover letter. This documentation could easily be 20 – 50 pages or more. You can search for these organizations through the Small Business Administration (www.sba.gov).