Small Business Loans and Grants
A couple of people took exception to my recent posting regarding the availability of government grants for starting a small business. Some of the comments were just people ranting without any facts, but some made a decent point. However, the most common think cited by email-ers was the Small Business Administration’s loan program. This is, of course, a completely different animal, but, one that merits a bit of discussion.
The SBA has tons of different loan programs, but its main one that people are most familiar with is the 7(a) loan program. As luck would have it, BusinessWeek published an article on the SBA loan program earlier this year. I think it merits reading for those of you counting on this route. The article notes an 18% downturn in the number of loans issued. Keep in mind, that this was written BEFORE the current credit crisis came into play.
SBA Loan Program Information
Ok, now that you have some current events background, let’s jump right in.
The Small Business Administration does not give out loans for small businesses. Anyone who says differently is trying to sell you something, or misinformed, either way, get your info somewhere else.
The SBA actually guarantees certain loans to small businesses. Those loans are actually made by banks who set the terms, approve the loans, and collect on the payments. The only way the SBS gets involved is if the loan is defaulted on (not paid back), in which case, the bank that made the loan may go to the SBA to get its money back.
Before you pay anyone money to give you the “inside track” on small business loans or do anything else for your business, do yourself a favor and take the SBA Free Online Course: Guide to SBA’s Loan Guaranty Programs. This program is free and it is right from the horse’s mouth, so to speak. Knowing the basics up front can save you a lot of money and heartache down the road.
Business Startup
Now, don’t take me the wrong way. I am not discouraging anyone from starting a small business, and I am not saying that you should not apply for grants and loans and any other form of assistance you can find. What I am saying, is do some research FIRST. In other words, look up the SBA and what it does BEFORE you post a gig on Guru.com seeking someone to help you apply for a Small Business Administration Grant (sic) because your small business will have a woman owner.
Then, you won’t have to worry about wasting all of that time and money.
Small Business Start-Up Grants
As a freelance writer, I write wherever the work takes me. As a small business consultant, I help business owners make smart decisions that both maximize the value of their time, as well as increase the value of their business. Grant writing for small business government grants is where these two roads intersect in a violent collision.
Need Someone To Write Grant Proposal To Start A Small Business
You see, there really are no small business grants, at least not the way most people think there are. As a business consultant this is the harsh reality that I must convey. As a writer, people think that my words can alter reality. I believe they can, but only in certain ways.
If you watch enough late night T.V. and you’ll see a guy in a green suit covered with question marks. No, he isn’t the Riddler, he is an infomercial guy peddling the secret to millions of dollars in government grants that people just like you can qualify for everyday!
Now, don’t get me wrong, there are millions of dollars of government grants out there everyday, but they are not for the general public to use to start up a small business except in extremely limited circumstances. I had to change my Guru.com profile to stop sending me project alerts for grant writing because I was starting to get tired of all the “projects” from people who wanted someone to write grant proposals to get them grants to start-up their small business.
The truly uninformed think that anyone can get a grant for any kind of business, because after all, government likes small business, right? The slightly more informed know that in order to get a business grant, you have to have specific features to qualify. Unfortunately, most of these people just have a vague notion that you need to have a minority owner or do something educational. While both of these factors are present in some government grant programs, they are never the only qualifications.
If you want to go the minority or woman owned business route, that does exist. The only thing is that the business almost always has to be about helping other minorities or women, it almost always has to be a non-profit organization, and it almost always has to be an established organization with a proven track record. The government doesn’t give people money to start up any business you want, just because you aren’t a white male.
Small Business Grant Reality
Before trying to venture the small business grant road, I humbly suggest you read these this information and then follow the link from their website to their suggested funding resources. Keep in mind that these are from the official Small Business Administration website. The SBA does not want your money. Can you say that about the website that claims something different from these links?
http://www.sba.gov/services/financialassistance/index.html
SBA provides a number of financial assistance programs for small businesses including 7(a), 504 and disaster assistance loans. Within this section, we’ll review eligibility requirements, SBA’s loan programs, surety bonds and the role of SBA, equity capital topics, special purpose loans, SBA partner topics and 7(a) lender programs. Though the SBA does not provide grants to help you start a business, included is information on organizations and sites that can assist you in locating special purpose grants.
Find New Freelance Work Now
I have enough clients right now. In fact, with the flexibility some of my clients give me, I theoretically have more work than I can possibly do this week. However, today, I am responding to job postings, following up with previous contacts, and reaching out to new firms and businesses who might benefit from my services. Why? Because, project end, clients leave or get bought out, and as the nice version of the bumper sticker says, “Stuff Happens.”
When I do business consulting, the number one reason I see for business owners and other executive having the roller coaster ride that comes from variable income, is that they aggressively seek new business when times are lean, and then once the business starts to come in, they push prospecting and new client acquisition off.
The difficulty, as one client puts it, is that if I have enough business to fill my time, why would I waste my time on something that doesn’t earn any money?
And that, of course, is the problem. Client acquisition does earn you money. In fact, it is the only thing that does. But, the point is valid. Why put off earning $1000 today just to try and earn $1000 tomorrow?
My answer is, don’t.
Monday to Friday and when necessary some weekend hours, I work for current cash flow. On Saturday or Sunday morning, I sit down and seek out new business. In that way, I never lose sight of the importance of keeping the pipeline full, but I also never feel like I am “wasting” precious billing hours.
If you have trouble keeping up with prospecting and finding new clients, try setting aside a block of time that you consider to be “extra.” Then, every week, use that block of time to get new business.
Here is the key. Use the whole amount of time, and nothing more, every single week regardless of what volume of “usual” activity there is for you on that week. In other words, if you normally reply to freelance design position postings and there aren’t enough to fill up the block of time, then do something else related to client acquisition. This is how you will eventually get to things like mailings, research, and other marketing campaigns without feeling overwhelmed whenever you look at all the things you can do.
Does it work?
Yesterday, the media reported the biggest job losses in 20+ years; my income hasn’t changed and my pipeline is full. Yes, it works.
Legitimate Work From Home Sites
A freelance writer often works from home. Sometimes, especially when first starting out, it can be nice to have a “real job” that lets you work from home. That is, a job that pays an hourly wage or something a little more stable than freelance writing does. The problem is that this area is flooded with spam, scams, and just plain worthless information. You’ve probably seen the ads in the paper or even on the side of the road “Make six figures working from home!” which are, of course, scams to prey on the uninformed.
I recently stumbled across a fairly recent CNN article that mentions some actual, real life, companies that offer various telecommuting or work from home positions. I don’t like to link to things I haven’t looked at yet myself, so I won’t post individual links here until I have a chance to look at them, but if you are interested, here is a link to the original CNN article.
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