Where You Can Apply for Small Business Loans in Colorado
When small business owners need money to grow their businesses or pay for other expenses, many of them apply for traditional bank loans. But what other options for small business loans in Colorado do entrepreneurs have available to them?
In this article, we’ll look at the different financing options small business owners in Colorado can access.
7 Sources of Small Business Loans in Colorado
If you need business financing in Colorado, there are multiple loan options available to you. Below, find seven sources of funding and the products they offer.
1. SBA Loans
The SBA loan program, organized by the U.S. Small Business Administration, provides businesses with a variety of financing options. The service is intended for existing businesses that have trouble accessing funds from traditional lenders.
The three main financial products offered by the SBA are:
SBA 7(a) loans: These are low-interest-rate loans that offer flexible repayment terms of between 10 and 25 years on amounts of up to $5 million. SBA 7(a) loans are often used to pay for equipment, machinery, real estate, expansion, working capital, or to refinance existing debt.
SBA 504 loans: Businesses can use the SBA 504 loan program to purchase major assets like real estate, machinery, and equipment. The maximum loan amount is $5.5 million, and the repayment period is either 10, 20, or 25 years.
SBA Microloans: These are smaller, short-term loans for up to $50,000 intended for startups and small businesses, and they often come with business training and assistance.
2. The Colorado Enterprise Fund
Established in 1976, the Colorado Enterprise Fund (CEF) offers an array of business financing packages to entrepreneurs in the state.
The following loan programs offer between $10,000 and $1 million over a period of up to 10 years to businesses in the state of Colorado:
Small business loans: You can borrow between $10,000 and $1 million so you can purchase commercial real estate, make property improvements, purchase equipment, and cover working capital needs.
Black Business Loan Fund: Black-owned small businesses have access to what the CEF describes as a “low-barrier, low-rate” finance option to help borrowers grow their companies.
Creative Industries Fund: This is a tailored finance product for businesses in the creative sector. The fund accepts applications from companies in the following sectors: apparel, design services, film, food/beverage, furniture, jewelry, lighting, literary and publishing, media, music, performing arts, salons, visual arts, and more.
Healthy Food Access Fund: This is a fund designed to alleviate food insecurity in the state, and the program is open to food carts, co-ops, delivery services, farmers markets, food production companies and distributors, retail grocery providers, trucks, urban and rural agricultural projects, and more.
Minority-Owned Businesses Fund: This program is intended to make funding accessible to groups that have traditionally experienced difficulty in accessing commercial finance, specifically Coloradans who are black/African American, Asian/AAPI, Hispanic/Latino, or indigenous Americans (including Native Americans, American Indians, and Alaskan Natives.
Other business finance options offered by CEF include:
Community Loan Funds: Small businesses in 13 areas within the state can access capital and coaching to improve the local economy and grow revenues.
Colorado Startup Loan Fund: In partnership with the Colorado Office of Economic Development and International Trade (OEDIT), this program is targeted at making business finance available to for-profit businesses earning less than $2 million a year in revenue and employing a maximum of 25 full-time staff. There is also a limited grant service available for new business owners, where 20% of a loan doesn’t need to be paid back, subject to a maximum of $15,000.
Transforming Safety Loan Program: This fund is aimed at breathing new economic life into areas that have been impacted by a higher rate of crime. It’s currently available to businesses in four ZIP codes within Southeast Colorado Springs. Companies in these areas can borrow between $1,000 and $50,000 for up to 60 months. The loan may be forgiven after three years if repayments have been made on time until that point.
VALOR Loan Program: This program was set up to help veterans transition more easily into civilian life. It offers loans of $5,000 to $500,000 over 10 years at a discounted rate.
ITIN Loan: The CEF established this program to provide commercial finance to undocumented people without a Social Security number. Borrowers can access between $10,000 and $25,000 over a period of up to 10 years.
3. Colorado Office of Economic Development and International Trade
The Colorado OEDIT is a major lender to businesses throughout the state. They offer many different types of loans and tax-credit-based incentive programs. Their primary missions are to support economic development and increase employment.
Current financing packages include:
Cash Collateral Support: This program helps small businesses secure loans by providing them with a cash deposit if the collateral they have is not enough to meet lenders' requirements. Lenders taking part in the program can receive up to 25% of the loan amount or $500,000, whichever is less, as collateral support.
Community Development Block Grant Business Loan: This product is intended for rural businesses to support the retention of existing jobs and the creation of new jobs. Every job saved or created unlocks $20,000 in loan funds.
Innovative Housing Incentive Program: This incentive program helps homebuilders by providing them with working capital grants, per-unit incentives, and development loans for the building of factories.
4. DreamSpring
DreamSpring is an award-winning nonprofit Community Development Financial Institution. It’s a popular lending source for both startups and new businesses. Entrepreneurs can also access their funding packages through the Colorado Small Business Development Center (SBDC).
Their current range of finance packages includes:
Power Line of Credit: This is a 24-month revolving business line of credit of up to $50,000 that offers fixed interest rates.
Small Business Loan: You can borrow between $1,000 and $250,000 for equipment, inventory, leasehold improvements, supplies, vehicles, working capital and more. It offers a fixed interest rate and a loan repayment term of 24-72 months.
SBA Community Advantage 7(a) Loan: In association with the SBA, DreamSpring offers between $50,000 and $350,000 to businesses with limited collateral for equipment, expansion, inventory, working capital, and more. Applicants should have a credit score of 650+.
Commercial Real Estate Loan: In this program, entrepreneurs can access $50,000 to $2 million of funding with a five-year repayment term to purchase commercial property — as long as their business occupies at least 51% of the purchased premises.
5. B:Side Fund
This non-profit organization offers the SBA Community Advantage (7a) Loan as well as its own direct loan program.
Their direct loans are intended to assist for-profit companies that have been in business for six months or more. Their current products are:
Express B:Side Loan: Intended for rural Coloradan businesses, entrepreneurs can access $20,000 to $25,000 for working capital purposes with this service. The repayment term is three years.
Climber Direct Lending Capital: This product offers $20,000 to $100,000 for working capital, inventory, equipment, and debt refinance. The repayment term is three to five years.
Direct B:Side Loan: Coloradan businesses can access between $25,000 and $150,000 for working capital, debt refinance, inventory, equipment, and business acquisition. The repayment period is between three and seven years.
6. CEDS Finance
Based in Denver, Community Enterprise Development Services (CEDS Finance) is an Islamic-compliant non-profit small business lender that works primarily with refugees and immigrants.
It currently offers the following loans to borrowers:
Spark: Borrow up to $5,000 over 18 months with no equity or collateral needed.
Elevate: Borrow up to $50,000 over 10 years with owner equity required.
Amplify: Borrow up to $100,000 over 10 years with owner equity and collateral required.
Borrowers don’t need to meet a minimum credit score requirement to apply to CEDS Finance.
7. Online Lenders
Many online lenders offer a range of business finance products — such as business lines of credit or working capital advances — to help you fund expansion or to assist with cash flow.
Unlike the often long and drawn-out process required by business banks and credit unions, the loan application process with online lenders can be very quick, meaning you receive the funding you need within a few days. They often don’t need to see a business plan or financial forecast. Many will also consider applicants with low credit scores.
Get the Funding You Need for Your Small Business in Colorado
Coloradan businesses are well-served by the SBA and the many local organizations dedicated to providing financing and helping companies survive and grow. There are also other options available via online lenders where the application process is a lot faster — meaning you can be funded in as little as 24 hours.
Backd is one of those providers. Apply for between $10,000 and $2 million with a working capital advance, or access up to $750,000 with a revolving business line of credit so you have funds available when you need them.
Apply for business financing with Backd and be funded within 24 hours of approval.
