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Fund It

There’s no hard and fast rule for how much time you should devote to planning your business venture. But there will come a point when you can no longer avoid the obvious question: “How am I going to pay for all of this?” Your answer may be found in the following options:

Use your own money.

Before you consider borrowing money to launch your business, take a hard look at your personal financial assets. Can you withdraw funds from your savings account? Cash out your stocks? Downsize your standard of living? Sell that boat or luxury car? If these are not viable options, consider your credit cards. Many a small business has stayed afloat by charging its way through a first year or two of operation, but it can be risky. If you follow this route, be sure to only use cards with favorable interest rates (cash-back bonuses are helpful too!), always read the fine print up front and make every payment on time.

Apply for a commercial loan.

Commercial loans, whether from private or public sources, are generally approved on the basis of a business owner’s capacity to repay as indicated by past business experience, personal credit rating and collateral. For a first-time business owner with little or no credit history, this can be a tough — though not impossible — category to crack, and a well-crafted business plan could make all the difference. By presenting a strong case for potential profitability, your written plan might just change a skeptical loan officer’s mind. Loans to support small businesses are typically available from:

  • Commercial Banks which used to be less than enthusiastic about financing business startups due to the high rate of new business failure, and today are more welcoming. In fact, many of the biggest names in banking have entire divisions devoted to small business lending, and most offer convenient online banking options. Types of funding and terms vary from bank to bank. Browse internet sites for broad details, then make an appointment to meet with a loan officer at a nearby local branch to discuss specifics.
  • Credit Unions offer many of the same services as banks, including small business loans and online banking options, but as nonprofit institutions, they tend to put greater emphasis on personal service and feature higher interest rates on deposits and lower rates on loans.
  • Commercial Finance Companies are often willing to take higher risks than banks, but they commonly charge higher interest rates. As a general rule, these firms tend to evaluate loan applications more on strength of collateral than a company’s track record or profit potential.
  • Digital Banking Platforms typically provide many of the same services as traditional commercial banks and credit unions, but with one important difference: All transactions are digital; no brick-and-mortar visits are required. Freelancers working from home or in shared workspaces may find this platform’s emphasis on convenience and flexibility appealing.

Know the Score
The odds of securing a loan for your business depend in large part on how well you have paid your bills in the past. As a first-time entrepreneur, you have no business credit history, which means that lenders and suppliers must look to your personal credit record to determine eligibility for financing. Do you know your credit scores? If not, take time to find out before you go looking for a loan. Visit annualcreditreport.com to find your scores from all three nationwide consumer credit reporting companies. It’s free.

Tap into public sector programs.

The U.S. Small Business Administration (SBA) does not lend money directly to small business owners, but it does set guidelines for loans made by its partnering lenders, community development organizations and micro-lending institutions. SBA-guaranteed loans generally have rates and fees that are comparable to non-guaranteed loans and typically feature lower down payments, flexible overhead requirements and, in some cases, no collateral requirements. In addition, some SBA-guaranteed loans come with continued support to help recipients start and run their businesses.

Applications for SBA loans are treated like any other commercial loan application: Demonstrated ability to pay the money back is the primary consideration for acceptance in the program, and the decision to approve or disapprove a loan application rests with the lending institution, not with SBA.

For information on loan types, eligibility requirements, lending sources and other concerns, visit the the Florida SBDC office nearest you.

Florida-Based Financial Support Programs facilitated by Enterprise Florida Inc. (EFI) to match qualifying businesses with lenders that can provide financial assistance and lines of credit include:

  • Small Business Loan Support Program Consisting of EFI’s State Small Business Credit Initiative (SSBCI) and Microfinance Guarantee programs, the Small Business Loan Support Program helps small businesses obtain loan approvals and leverage private capital for use in startup costs, working capital, business procurement, franchise fees, equipment, inventory or the purchase of owner-occupied commercial real estate. The program provides necessary security, in the form of a partial guarantee, and as a result, participating lenders feel comfortable approving a loan or line of credit.
  • Venture Capital Program The EFI-sponsored Florida Opportunity Fund provides venture capital for startup and early-stage businesses. State Venture Capital Programs typically take one of two forms: a state-run venture capital fund (which may include other private investors) that invests directly in businesses; or a fund of funds that invests in other venture capital funds which, in turn, invest in individual businesses. Factors such as resources and available talent help determine the appropriate vehicle.

For additional information on these programs, visit enterpriseflorida.com/small-business/

Find SBA Lenders
Lender Match is a free online referral tool that connects small businesses with participating SBA-approved lenders. For information visit: sba.gov/funding-programs/loans


Spectrum Signs & Graphics, Jacksonville
Growing up in Germany, Franziska Scone never dreamed of owning her own business, let alone in America. But in 2016, she and her husband Joseph, an Army veteran, bought Spectrum Signs & Graphics. Scone was to run the business and, knowing that she would need a lot of information to do so, she turned to the Florida SBDC at the University of North Florida. Consultant Kaitlyn Saavedra helped her connect with the right people and programs. Scone learned about her firm’s financial health, stability and growth potential, found an insurance agent and an accountant, mastered QuickBooks and improved her company’s website, Google rankings and social media. As a result, Scone and her husband enjoyed better business operations overall.

Attract a private investor.

Venture capital firms or private individuals called “angels” may be willing to invest in your business if they see high potential. Venture capital firms are typically controlled by banks, insurance companies and large corporations; angels, on the other hand, are usually wealthy individuals looking to support “hot” ideas and untapped investment opportunities. In return for backing your business, either entity will expect some level of control and/or a percentage of future profits. Since these types of investors typically take risks only on people and products they truly believe in, you will need to approach them with uber-confidence and a written business plan that is heavy on “wow.”

See list of Florida venture capital firms or visit Venture Forum for more information.


Seek targeted financing.

Your unique race, ethnicity and/or gender may well open doors to targeted funding and educational opportunities. And while there are no funding opportunities specifically set aside for veterans, there is plenty of information available to help entrepreneurial-minded vets transition to civilian life as business owners.


Obtain a grant.

Almost no federal grant money is available to launch for-profit small businesses. However, some businesses engaged in scientific R&D may qualify for federal grants under the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs if their projects meet federal objectives and have a high potential for commercialization. For details, visit SBIR.gov. For information about grants available through state and local programs and nonprofit organizations in Florida, visit floridagrantwatch.com.

Give crowdfunding a try.

Loosely defined, crowdfunding is one way to launch a business by getting a bunch of people you may or may not know to donate the startup money online. If you decide to go this route, you can either create and manage your own crowdfunding site or use an existing crowdfunding platform such as Kickstarter or GoFundMe. There are pros and cons to either option, and the SEC has rules and procedures for soliciting “shareholders” online. If crowdfunding appeals to you, look to the specialists at your local Florida SBDC office for advice and do your homework before signing on to anything.


Speeding Recovery
Through September 2020, small businesses experiencing temporary loss of revenue due to COVID-19 are eligible to apply for an SBA Economic Injury Disaster Loan advance of up to $10,000.

If approved, funds are made available within three days and do not have to be repaid. Visit covid19relief.sba.gov to apply.

See a list of Small Business Recovery Resources.

Targeted Financing Opportunities

If you are Black, Hispanic or female, your business may be eligible for targeted financing:

The Black Business Loan Program (floridajobs.org/BBLP) provides loans, loan guarantees and/or investments through loan administrators to Black business enterprises that cannot otherwise obtain capital through conventional lending institutions. In addition, Black Business Investment Corporations throughout Florida stand ready to facilitate access to capital for Black business owners.

Likewise, Hispanic business owners can find funding information and other business resources pertinent to their specific needs through Prospera (prosperausa.org). This nonprofit economic development organization provides bilingual assistance to entrepreneurs seeking to access capital in the form of traditional bank loans as well as SBA and micro-loans.

And while no government loan programs exist exclusively for women business owners, recent history shows that SBA loans are three to five times more likely to go to women than non-SBA-guaranteed loans. On the local level, Women’s Business Centers stand ready to provide assistance in applying for loans and also may provide access to alternative capital financing programs.

Likewise, there appear to be no federal funding opportunities available solely to veterans who want to launch businesses. However, the U.S. Department of Veterans Affairs Office of Small & Disadvantaged Business Utilization (va.gov/osdbu/) has plenty to offer on the subject of veteran business startups. Click on its Veteran Entrepreneur Portal for easy access to federal services and best-practices information about starting, growing and funding a business. In addition, the SBA website has an entire section devoted to business resources for veteran entrepreneurs at sba.gov/business-guide/grow-your-business/veteran-owned-businesses.