New Gap Funding Options for Minnesota Business Owners

New Gap Funding Options for Minnesota Business Owners Main Photo

4 Jan 2023

Minnesota Department of Employment & Economic Development (DEED) asked hundreds of state business owners a simple question: What would make it easier to start a small business? The resounding answer was, “help us hurdle the persistent gap in funding when we are just getting started.”
Now, help is on the way. The federal government has approved Minnesota for $97.5 million in small business funding through the State Small Business Credit Initiative (SSBCI). Based on research and dozens of listening sessions with stakeholders over the last year, DEED is committed to addressing significant market gaps in financing with this funding. The agency will launch six Treasury-approved programs under the new initiative to benefit small businesses. In most cases, businesses will access funding through approved lenders or other external financial institutions. 

SSBCI Funding Programs

DEED is now accepting applications from businesses seeking financing from the Growth Loan Fund (GLF). GLF supports entrepreneurial growth throughout Minnesota by offering low-interest loans to early-stage businesses engaged in or committed to engaging in technological innovation in Minnesota.
Other new programs accepting applications include:

Sign up here to be notified when additional SSBCI programs are announced over the next few months.

Currently Seeking Lenders

For the Minnesota Loan Guarantee Program, DEED is now accepting applications from lenders who would like to participate. Businesses seeking funding should check back here to obtain the list of enrolled lenders as it becomes available. The Minnesota Loan Guarantee Program (MNLGP) provides guarantees to enrolled lenders for up to 80 percent of the principal on loans to eligible businesses. 
Funds will be targeted to small businesses headquartered in Minnesota with fewer than 500 employees. Funding can be used for eligible purposes, including startup costs, working capital, equipment, inventory, and the purchase, construction, renovation, or tenant improvements of an eligible place of business that is not for passive real estate investment purposes. The funds may also be used to purchase any tangible or intangible assets except goodwill.
DEED is also accepting requests for proposal responses from lenders who would like to participate in the Small Business Loan Participation Program. Once lenders are approved, borrowers will apply directly with one of those lenders. Loan proceeds must be used for eligible business purposes, including equipment purchases, working capital, startup costs, real estate purchase, and construction, renovation, or tenant improvements of an eligible place of business. Loans may not be used for passive real estate.

New DEED Small Business Hub

With so much growth and new funding, DEED launched its Small Business Hub to consolidate all the information and resources Minnesota entrepreneurs need in one space. The Hub provides details on DEED's SSBCI programs, as well as resources and expertise for small business owners looking to launch in Minnesota. For example. “Five Steps to Start a Small Business” walks you through organizing your business structure, tax ID numbers, licenses, permits, and more. You can check out their extensive resource guide here.

Benton Economic Development Partnership

BEP works tirelessly to support entrepreneurs, small businesses, and industry.  BEP focuses on business retention and expansion, leads workforce development, and assists with marketing and promotion to ensure the local community can achieve the highest quality of life possible. Reach out to BEP at (320) 968-6197 or to see how we can help today!

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