Many young companies turn first to banks for financing, but quite often banks are unable to lend to startup businesses because of all the federal and state regulations that keep them from taking too many risks. Here are some other places to turn.Debt Financing and Loan GuaranteesCoastal Enterprises, Inc. (CEI)
CEI is a private, nonprofit that provides financing and support for job-creating small businesses, natural resources industries, community facilities, and affordable housing in primarily rural regions of Maine. CEI & its subsidiaries offer various programs including financing for otherwise hard to finance businesses.
• Direct loans to start-up, existing and growing Maine small businesses, in amounts ranging from $1,000 to $50,000.
• Venture capital investments in small businesses located in New England and the mid-Atlantic region. Investments range from under $500,000 to over $1 million.
• New Markets Tax Credits are available for investments in targeted distressed communities in Maine, Northern New England, and upstate New York. Select projects with high 3E impact will be considered in other parts of the country. Tax credit investments range from $2 million to $30 million.
• The SBA 504 loan program which provides fixed-rate financing for machinery, equipment and buildings - as much as $4 million for manufacturing.Finance Authority of Maine (FAME)
FAME offers a wide array of business assistance programs, ranging from traditional loan insurance programs for both small & larger businesses (useful when a bank can’t quite take the risk on their own), to tax credits for investments that individuals make in dynamic, growth-oriented, manufacturing or export-related firms. a
5 Community Drive, Augusta Tel 207-623-3263 or 1-800-228-3734Small Business Administration (SBA)
The SBA is a federal organization that does many things to support small business. It does not directly make loans but it does provide loan guarantees that enable commercial banks to lend where the risks otherwise would be too high. The SBA now has a convenient way for businesses to connect with SBA Approved Lenders, called the LINC program with three simple steps, click the link.Grants for EntrepreneursLibra Future Fund
Grant funding available to young entrepreneurs with a business plan, good references and a passion about what they want to do. Exclusively for entrepreneurs under 30 yrs old. Coordinator is Erik Hayward, firstname.lastname@example.org; 207-879-6280Maine Technology Institute (MTI)
MTI has a staged series of grants and attractive loans for innovators and companies looking to turn their technology ideas into commercial products. They are part of the Business Innovation program at MTI. The three most common are:
• Tech Start Grants: up to $5,000 grants (awarded 12 times/yr) for concept planning, market research and tech transfer exploration
• Seed Grants: up to $25,000 (awarded 3 times/yr) to support very early stage research & development activities for new products & services that lead to the market. Funded activities include proof of concept, prototype development & testing, field trials, pilot studies or technology transfer activities. * All projects must fall under one of Maine’s 7 targeted technology sectors.
• Development Awards up to $500,000 (awarded 3 times/yr) to conduct further research as a conditional loan for later stage R&D activity. (requires funding or in-kind match). (Requires a Concept Review Meeting with MTI Business Innovation Staff) SBIR/STTR
Some federal government agencies set aside research funding for small business grants. MTI has resources to help companies understand and prepare for these grant applications. While the grants can exceed $1 million they also take a lot of time and effort. For more information first visit this web page.Slow Money Maine
As an enabler of the “Slow Food” movement, Slow Money Maine is an intentionally inclusive, diverse network representing many sectors and communities in Maine, with a focus on supporting local sustainable food systems. They convene gatherings, connect people to each other’s needs, and catalyze the flow of funds and technical assistance to a wide array of food businesses. They provide a mix of small grants and loans to farms and agriculture related businesses. Slow Money Maine is the most active Slow Money group in the world! Equity Financing For a small number of entrepreneurs with very high growth potential, selling a share of your company can help finance a plan that banks and grants won’t.
An organized group of more than 70 individual private equity investors who make early-stage investments. Maine Angels acts as a mechanism for interested accredited investors to collaboratively locate, investigate and make investments in early-stage, high risk/return opportunities. Since being organized in 2003, Maine Angels has collectively invested more than $13 million in more than 40 promising early stage ventures, about half in Maine and the rest across New England. There are monthly meetings to review deals. Each individual decides on their own investment from the shared due diligence. Greenlight Maine host Don Gooding was Vice Chair for the last four years.Maine Venture Fund (MVF)
The Maine Venture Fund is a professionally managed venture capital fund that invests exclusively in Maine companies that demonstrate a potential for high growth and public benefit. The Fund has been actively investing in Maine companies since 1997, after its creation by an act of the Maine Legislature in 1995. The fund has received $13 million in capital contributions from the State of Maine and operates as a revolving, “evergreen” fund with more than 20 companies in its current portfolio.