Getting Federal Funding For Small BusinessA woman who has been looking for some type of loan to start a small bakeshop business with once came in with the news from her newly installed DSL internet connection that someone was offering her federal funding for small business. Consequently, she talked about the offer with her friends who in turn admired her enthusiasm and tenacity. Then, when she was done (after running out of breath talking about buying German ovens and pretty Dutch ceramic muffin molds with the loan) her friends led her back to her senses by saying that she was being misled. She was told that there is technically no such thing as federal funding for small business. She insisted that the email she received said so. There was even this website that offered sources and forms to get federal funding for small business. She was then advised that being a newbie, she was not used to the free-wheeling flow of information on the internet, most of which was simply used to catch her attention but leading her on to something else and not exactly what she was hoping for. To further demonstrate to her, she and her friends got online and visited official federal and government sites which informed her in fine print as to what federal funding for small business was all about. For most people in a similar situation, looking for money is not as simple as filling out a form and being able to show a tangible business plan and the means of paying a loan back. The first question you should ask yourself is do you know your potential business' financial and set-up structure well enough to qualify for funding that it could be entitled to? Once you can answer that, then it is time to look up for what is available for your kind of business. Be aware that in general, state and federal governments do not offer grants for start-ups and small businesses. What is available as what you could call federal funding for small business are loans (usually with interest rates pegged lower than the market) and venture capital financing. If you are a scientist or an inventor involved in highly technical research and development, there are science-backed grants specifically for these types of businesses. But even if the federal government cannot offer you funding directly, there are conduits by which you will be assisted in looking for and applying for a loan. There is the U.S. Small Business Administration or the SBA which functions not as a lender, but as your guarantor in applying for numerous loans at sensible interest rates from private banks and other financial institutions. The SBA so far is the largest financial guarantor for such loans to small businesses. Other forms of federal funding for small business are concentrated on agricultural concerns. If you have a farm and would like to expand, the U.S. Department of Agriculture or the USDA can extend loans similar in terms with that of the SBA. If these loan avenues from federal sources do not somehow meet the requirements of your business, do not give up home. Set up an appointment with your bank's financial advisor for some fresh ideas on how and where to get financial banking. Take heart in the fact that in these robust times for small businesses, private firms are more than willing to accommodate the next big idea from a small start-up such as you. |