Startup Finances
From loans and grants, determine the best way to finance your business.
Funding your business
Starting a business can be expensive. But there are resources such as grants and low-cost loans to help you finance your business. Be sure that you plan and save enough cash to operate your business for at least the first few months. This may include the amount of money you need to cover your startup expenses such as buying equipment as well as permit or license fees. It may take time to set up before you have enough customers to be profitable.
Using the calculations and estimates from your business plan, decide if you have enough money to begin, or if you need additional capital first. Lenders want to see that you have some of your own capital invested in your business.
Financial Projections: You will need financial projections for at least the first three years of operation including a forecast of future sales and the costs to run your business.
Funding Options
Loans: There are many types of loans available to business owners such as SBA loans, Term loans and equipment financing loans. Many banks will also give loans to small businesses. Loans may be used to buy commercial kitchen appliances, flatware, furniture, and other items needed to run the business. The requirements for these loans may be more demanding and interest rates may also be higher. We encourage you to contact your bank for current rates and terms.
BIPOC-specific loans:
MWBE - Minority and Women-Owned Business Development & Lending Program
Eligibility: certified minority and or women-owned business enterprises
Link: https://esd.ny.gov/minority-and-women-owned-business-development-lending-program
Brooklyn EXCELerate Loan Fund
Eligibility: BIPOC-owned small business operating in Brooklyn (at least 51% BIPOC ownership), was operating as of Jan 1st 2020, needs access to capital, is unable to raise/borrow capital from traditional sources on reasonable terms (some expectations apply), has the potential to generate or retain incremental jobs in Brooklyn, agrees to present and adhere to Technical Assistance
Eligible Use: expand or help refinance and existing loan (maybe)
Link: https://www.brooklynchamber.com/services/financing/
Renaissance Greater New York Loan Fund
Eligibility: business owners who are social & economically disadvantaged for existing businesses or startups
Renaissance SBA Community Advantage
Eligibility: underserved communities and business owners having difficulty accessing traditional banking capital, SBA approval for loan, existing business or startup
Eligible Use: working capital, leasehold improvements, start up, machinery & equipment, inventory, debt refinance
General loans:
Renaissance SBA Microloan
Eligibility: microbusinesses for entrepreneurs looking to start a business in NYC, existing businesses or startups
Eligible Use: working capital, leasehold improvements, startup, machinery & equipment, inventory, debt refinance
Renaissance Emergency Loan Program
Eligibility: Existing businesses only, demonstrate unexpected damages
Community Capital New York Small Business Loan
Eligibility: check website under ‘loan requirements’
Eligible Use: open a new location, upgrade business equipment, add a new product or service, or hire employees
Link: https://communitycapitalny.org/small-business/small-business-loan/
Community Capital New York Microloan
Eligibility: Business must be located in the Bronx, be a start up, small business, or sole proprietor, some other requirements check website
New York State Small Business Revolving Loan Fund
Eligibility: a business enterprise that is resident in and authorized to do business in New York; an independently owned and operated business; not dominant in its field; employs 100 or less people on a full time basis
Eligible Uses: working capital, acquisition/improvement of real property, acquisition of machinery and equipment, refinancing of debt obligations*
How to Apply: program lenders are the primary point of contact for borrowers and each have their own individual loan application (see link)
Link: https://esd.ny.gov/nys-small-business-revolving-loan-fund-round-2
Grants: Grants may be available for business. Some grants are for businesses at a specific stage or to support business owners from certain communities (ie women, BIPoC, startup).
BE NYC - Black Entrepreneurs NYC
Eligible Use: BE NYC experts consulting program (receive 4 hours of free consulting and expert guidance)
How to Apply: https://nyc-business.nyc.gov/nycbusiness/article/be-nyc-access-consulting
New York StartUP! Business Plan Competition
Eligibility: Must live in Manhattan, the Bronx, or Staten Island, business must also be in one of those three places, business must have ideas or models in the startup phase and have earned less than $10,000
Amber Grant for Women
Eligibility: Appears open to be open for all women in NYC
Food & Beverage Business Grant
Eligibility: Women with food & beverage business
Link:https://ambergrantsforwomen.com/business_category/restaurant-food-beverage/
Food investor networks:
- Kitchen Fund (https://kitchenfund.com/)
500 Park Ave, 4th Floor
New York, NY 10022
info@kitchenfund.com - Slow Money NYC (https://www.slowmoneynyc.org/)
- Collab Fund (https://collabfund.com/)
- Ahimsa Capital (https://ahimsa.capital/)
Investment: Business owners may pursue investment opportunities to cover startup costs. In addition to money, investors may provide other assistance such as marketing, public relations and financial planning.
Crowdfunding: Crowdfunding is the process of raising funds for a business from a large number of people, called crowdfunders. Crowdfunders aren’t technically investors, because they don’t receive a share of ownership in the business and don’t expect a financial return on their money.
Instead, crowdfunders expect to get a “gift” from your company as thanks for their contribution. Often, that gift is the product you plan to sell or other special perks, like meeting the business owner or being acknowledged somehow. Crowdfunding is a popular option for people since it helps build awareness and potential customers.
Crowdfunding is also popular because it’s very low risk for business owners. However, there could be risks and obligations if the business does not succeed. Every crowdfunding platform is different, so make sure to read the fine print and understand your full financial and legal obligations.
Finance Checklist
Research local funding options
Create a financial plan