As of this writing, the chance to obtain additional federal COVID relief seems slim. Congressional negotiations are in limbo. That is bad news for small businesses that still need financial assistance to keep going or continue business growth. If your current resources are tapped out, try these ideas.
Right now, there are limited paths to get capital to help your business. But keep in mind, limited does not mean impossible. The first step is to assess your financial standing.
- How much capital do you need?
- How quickly do you need the funding?
- Are you willing to give up a stake in the company?
Depending on the answers, you’ll know the next best steps. Just a few of the avenues to pursue include:
An ideal candidate for a VC infusion already has very high growth potential, a massive market, and a major amount of capital to fund that growth. In other words, you need to be a top performer in the current market. And remember, this route requires you to give up partial ownership.
The SBA’s 7(a) loan program
The 7(a) loan program is the SBA’s primary program for providing financial assistance to small businesses. The terms and conditions will vary by the type of loan. The low rates make these loans attractive. They require good credit, and take approximately three months to underwrite and fund.
The SBA’s EIDL loan program
You may qualify for a low-interest EIDL loan from the SBA even if you received a PPP loan. EIDL funds can be used for working capital and normal operating expenses. Your business must have 500 or fewer employees. A reminder: Submit your application through the SBA.gov website. Also, do NOT work with anyone who is charging a fee. Banks and authorized agents are not charging fees.
Traditional term loans
This is a good, low-cost option for mature and profitable businesses with great credit. There are high qualification standards, and the terms may require your personal assets to be used as collateral.
Other ways to get help
Keep updated about available help by tapping into:
- Your state’s Economic Development Agency website, which outlines available relief programs. Stick to the official website. Do not stray into third-party ones.
- Local business organizations, which share a variety of options specific to business industry, location, or demographics. Get on email lists or follow on the social media accounts of your local chambers of commerce, business improvement districts, and any other regional industry and local business organizations for information about new funding opportunities, including grants.
Bottom line: Since we can’t predict what will happen with future federal financial relief, take any steps you can right now to tap into available resources. If you need assistance navigating the relief options your business is eligible for, reach out to our team directly.