Financial resources are needed now more than ever for small business owners still recovering from the pandemic. To address this need, the State Small Business Credit Initiative (SSBCI) is distributing $10 billion in funding across all 50 states and territories in the United States. Applications are now open in Kansas – business owners will want to act fast.
Kansas was allotted $69M in SSBCI funding, which is being distributed through Grow Kansas (GROWKS) loan matching programs. These opportunities are right for you if you have obtained funding from an outside financial institution like a bank or a CDFI in the last three months, or plan to do so soon.
A main priority of the state is to increase available capital for minority groups and other marginalized business owners.
What kinds of funding can Kansas businesses receive?
Each state has its own plan for distributing funding. In Kansas, funding is given through a variety of programs, all of which fall into two categories: loan programs and equity programs.
Here is what you will see:
GROWKS Loan programs: These programs (five total) offer loan match amounts to private capital. Business owners will work with financial institutions such as a bank or community development financial institutions.
GROWKS Equity programs: These programs are designed to match private investments. Multiple rounds of investments are possible in this structure.
Which SSBCI programs are open now in Kansas?
The GROWKS Loan program and the GROWKS Equity program are broken into funding opportunities and programs that meet specific needs and serve specific communities. Explore below to find the best fit for your business:
GROWKS Loan programs:
Starter Program for Minority/Women/Economically-Disadvantaged: These starter loans are for minority-led, women-led, or economically disadvantaged-led businesses in Kansas. Loans provide a 200% match to bank loans that have already been approved. Loans can be up to $100,000. This program would be best for businesses that have only been operating for 6-24 months.
Growth Programs for Minority/Women/Economically-Disadvantaged: Also for minority-led, women-led, or economically-disadvantaged-led businesses in Kansas, these growth loans provide a 25% match to already-approved loans. Up to $250,000 can be approved. This program was designed for businesses that have been in business for at least two years.
Programs for Rural/Urban-Distressed: These loans target businesses that are located in rural areas, or distressed areas of urban centers in Kansas. These loans provide a 150% match to an already-approved bank loan. Up to $100,000 can be approved.
Programs for Community Assets: Business projects funded through these loans must benefit the community by creating more quality jobs, increasing access to care and/or education, or providing other civic and economic benefits. These loans will provide a 15% match to an already approved loan. Up to $250,000 can be approved.
Programs for Targeted Sectors: Business projects funded through these loans must advance targeted sectors including advanced manufacturing, aerospace, distribution, food and agriculture, and professional and technical services. These loans provide a 10% match to already-approved loans. Up to $1M can be approved.
GROWKS Equity Programs: These equity investment programs serve for-profit small businesses in Kansas, both new and existing. Business projects must benefit the community by creating more quality jobs, increasing access to care and/or education, or providing other civic and economic benefits.
What businesses are eligible for SSBCI funding?
Since Kansas has a wide variety of open programs that each serve different needs, eligibility requirements will vary depending on which program you apply for. However, there are some general requirements to keep in mind.
Your business is eligible for a GROWKS loan if:
- you have funding from an outside financial institution like a bank or a CDFI that was obtained in the last three months.
- it is based in Kansas.
- It has fewer than 500 employees
Your business is eligible for a GROWKS equity investment if:
- you have funding from a private capital source.
- It is based in Kansas
- it has fewer than 500 employees.
What can the funding be spent on?
- Startup Costs
- Working Capital
- Franchise Fees
- Equipment Purchase
What CAN’T the funding be spent on?
- Projects with no bank involvement
- Passive real estate
- Speculative activities
- Pyramid sales
- Stock ownership
- Activities prohibited by Federal or State law
How to apply for SSBCI funding in Kansas:
In Kansas, there is a lot of work to be done before you apply for SSBCI funding.
If you apply for a GROWKS loan, you must have a bank-approved loan that was secured in the last three months. Meanwhile, if you apply for a GROWKS equity investment, you must have private capital funding.
Whichever route you take, research is required. Finding a financial institution to work with can be taxing. Here at Skip, we recommend starting by reaching out to the financial institutions you already do business with.
Unfortunately, Kansas has not released a list of approved lenders. This means that the first institution you reach out to may not be participating in the SSBCI program.
No matter which funding source you connect with, some parts of the process will look the same no matter what – like your documentation.
Doing your due diligence to document your business and your application is the key to SSBCI funding success. Be prepared to provide:
- a business plan
- intake surveys
- past business tax returns
- past personal tax returns
- a business debt schedule
Common challenges in applying for SSBCI funding:
In Kansas, the most challenging part of obtaining SSBCI funding is finding a lender to work with.
The GROWKS loan programs are loan match programs; this means that you need to have an approved loan in place before you can get SSBCI funding.
While this can feel like a lot, it doesn’t need to be. You can book a consultation with one of Skip’s Client Success Managers, who have the experience and expertise to help you determine who to work with and obtain a business loan in the process.
Once you have an institution to work with, the process becomes more streamlined. Then, you can focus on your documentation – like creating a stand-out business plan.
Applying for SSBCI funding isn’t something that gets done in one setting, but it’s worth the time and energy. These matching loans have the power to transform your business – and we are here to support you along the way.