While cash from Uncle Sam may not be tops for startups, SBA loans can provide low-cost capital.
How does it matter Between a startup and a small business? Literally, mostly. As many startups find themselves struggling to raise funds from venture capitalists as funding continues to decline this year, the US Small Business Administration (SBA) can prove to be a powerful resource for capital, even if startups have traditionally been Look for funding from other sources.
Chris Hearn, Fountainhead’s founder and CEO, knows the potential benefits of taking on government funding. Fountainhead is a non-bank lender of loans guaranteed by the government. Hearn said the current generation of entrepreneurs is focused on raising equity-based funding from backers such as venture capital firms — but it’s not their only option, especially as equities become more expensive in current market conditions.
“The problem is that business owners often overlook readily available debt capital,” Hearn told Meczyki.Net. “They don’t have to give up any equity. [SBA loans] They may need to take precise steps several times to get to the next stage.”