Minding Your Business - Locating Start-up Financing

Locating Start-up Financing

All businesses require some form of financing. You need to decide how much your business will need and where you will get the money.

How Much Money Do You Need?

Use these web sites to estimate how much money you will need to start your business and keep it going.

Finance Start-Up from the Small Business Administration
Start-up and Annual Expense Worksheets (pdf) from the Missouri Business Development Program

Where Will You Get the Money?

Michigan State University's Funding for Business and Economic Development site covers the basics and lists lots of sources for financing in general.

SCORE, Counselors to America’s Small Business, has an extensive list of information that can help you locate financing.

Here are local financing resources.

The Small Business Administration offers information on its loan programs, federal contracts, minority and women's programs and micro-loans. Micro-loans are relatively short-term, low-documentation, quick-approval loans for $35,000 or less. The Springfield office is located at 830 East Primrose, Suite 101; the phone is 417-890-8501.
The Springfield Business and Development Corporation sponsors periodic Venture Capital Network forums. An entrepreneur hoping to connect with venture capitalists completes a two-page application form, provides a copy of his or her business plan and pays a $150 fee if selected for participation. Applications are reviewed for accuracy and completeness, but not for plan viability. For information, contact Greg Williams at the Chamber of Commerce. A hypertext list of venture capital funds in Missouri can be found at Technology Gateway.
SBA's Certified and Preferred Lenders. Certified lenders, by having had substantial involvement in SBA loan programs and meeting stringent criteria, receive a partial delegation of lending authority. Preferred lenders have earned full delegation of lending authority and are considered to be the SBA's most active and expert lenders. SBA lenders typically will require a one-third equity position by the borrower.
SBA's Small Business Investment Companies in Missouri are private lenders which provide equity capital and long-term credit to small businesses only. Both Apple Computer and Federal Express received SBIC backing in their formative years.
The only Certified Development Company servicing Greene County is RMI. A CDC offers loans (often called "504 Loans") for major fixed assets--land, buildings, equipment--which enable small businesses to create or retain jobs. An equity position of at least 10% is required from the borrower, CDC participation will be to a maximum of 40%, and the remaining financing must be arranged with private-sector lenders. Financing cannot be used for working capital, inventory, debt consolidation, paydown or refinancing.
The Certified Capital Companies (CAPCOs) program encourages private investment in businesses that derive their revenue primarily from manufacturing, processing or assembling of products or conducting research and development. Service businesses which can demonstrate that more than 33% of revenue would be from outside Missouri also are eligible. Details are available from the Missouri Department of Economic Development.
The Missouri Innovation Center operates a clearinghouse for Missouri's venture capital community.
Ozarks Regional Community Development Corporation (pdf) is a for-profit corporation established to provide gap financing to business and industry in a ten-county area surrounding Springfield.
Springfield Finance and Development Corporation provides loans to small business projects located in central Springfield which result in job creation or retention and which could not be financed through conventional means.
The Missouri Research Toolbox lists assistance programs offered by Missouri to businesses and communities. The document Raising Money or Capital for Your Business will help you find ways to fund your new venture.