There are several sources of finance for businesses across the United States. Here's a guide to government programs and assistance for US-based entrepreneurs.
Recent months have been challenging for businesses around the world, but there are resources to help small businesses get on their feet or (if they’re established) stay afloat.
For US businesses, government help takes many forms, whether that’s free counselling or advice, business loans, government contracts or grants.
Here’s a guide to resources for US businesses, especially small and medium ones. We’ll look at:
Business loans are one of the leading sources of finance from the US government. They’re preferable to borrowing from private institutions, because the interest rates are far more favorable.
Additionally, a loan from the Small Business Association offers lower down-payments, no need for collateral and flexible overhead requirements. In many cases, the SBA provides free counselling and education.
Available loan amounts range from the modest $500 to the substantial sum of $5.5 million.
To be eligible for a US government loan, a businesses must:
In the past few months, the government has unrolled numerous initiatives to help struggling businesses.
This is an SBA loan that helps businesses maintain their workforce capacity during the Covid-19 crisis. The Paycheck Protection Programme is subject to change, so check the official PPP information regularly.
Some small loans (of $50,000 or less) are being forgiven under the PPP. And it was recently announced that the government is simplifying the application process. Again, this is accurate at time of publication.
Our friends in Sage wrote a separate post entirely about the PPP and loan forgiveness.
The US government encourages applications to government contracts. In fact, 23% of government contracts are earmarked for small businesses.
Applicants can gain mentoring and education on how to win these contracts.
They can also apply for some of these in collaboration with other companies who have previously won government contracts.
There are also separate offices and organisations that specialize in helping entrepreneurs and business owners in specific communities, such as:
Before you apply for a grant or loan, there are some steps to take, chief of which is creating a business plan. Here’s what you’ll need to include…
This introduction will explain what your business is and why it’s meeting needs or gaps in the market. You might include a mission statement, explaining the purpose and philosophy of the company, as well as initial, high-level numbers.
Market research is a good idea regardless of whether you’re creating a business plan for a loan or assistance. You should carry out some form of research to see if your business is viable in the business’s location.
For instance, if you want to open a cafe, go to the neighborhood and examine footfall; do surveys on social media. Or, if you want to go further in the online route, you can launch a survey with a service like Survey Monkey or Google Survey. Both are affordable.
This market research will give you some hard numbers and insights into the business’s viability, which will be a compelling element of your business plan.
What service or product do you provide and how does it differ from and/or surpass competitors? If it’s a new product, or is based on new research, you might need to provide patent or copyright.
How much does your company expect to generate in the coming months and years? Will there be off-seasons, and if so, will peak times make up for it? If you’re an established company, existing records might paint a picture of the future (as long as you take changing circumstances into account).
The SBA’s Business Guide page is a comprehensive treasure trove of advice and information. This covers everything from choosing a business name, picking the right premises to being legally and tax compliant.
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