Where to find funding to expand
Grants are hard to come by, but even companies with debt can locate loans.
(FORTUNE Small Business) -- Dear FSB: I'm part-owner of our family business. Our goal is to expand and become a larger company. Do you know if there are grants that help small businesses grow? If so, whom do I contact? We have some debt, which has prevented us from expanding.
Thank you for your help.
- Sergio Lomeli, El Paso, Tex.
Dear Sergio: You are probably going to have to consider other financing options, because general grants aren't so easy to come by, and when they are, they're highly competitive.
Adrian Madrigal, public information officer at the El Paso District Office of the Small Business Administration, suggests applying for an SBA-guaranteed bank loan to refinance the debt that is holding back your business. Remember, the SBA (Small Business Administration) doesn't make loans themselves, but they may guarantee a loan from a bank. You will need to arrange a meeting with an SBA loan specialist at your local bank. If writing bank proposals isn't your forte, you can use the free services offered by the SBA and its partner organizations - including local chambers of commerce - to assist you with the proposal.
If you think you'll have problems coming up with the working capital necessary to qualify for the loan, Madrigal recommends organizations such as the Texas Mezzanine Fund and the El Paso City/El Paso County Joint Revolving Loan Fund as sources of a low-interest working capital loan.
You should also consider non-traditional lenders. Terri Reed, senior vice president of entrepreneurial development at El Paso Hispanic Chamber of Commerce, suggests the microloan organization, Accion Texas, which, she says, lends up to $50,000 with collateral at reasonable interest rates.
Also, the Hispanic Chamber of Commerce is one of the SBA's resource partners, so Reed suggests that you contact the chamber for help. "Business owners don't have to be a member of the chamber in order for us to assist them," she says.