In 1776, the United States declared its independence from Britain. A hundred years later, Colorado became the 38th state in 1876, thereby earning its official nickname as the “Centennial State.” Since that time, small businesses—with the help of loans from their lenders and other financial organizations—have been responsible for developing the Centennial State into an economic powerhouse.
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Types of Colorado Small Business Loans
The Centennial State has small businesses engaged in agriculture, tourism, technology, mining, and retail. The lenders in Colorado understand the characteristics of these industries and have experience in making all types of long-term and short-term loans to these businesses.
SBA loans
SBA loans are business loans that are partially backed by the Small Business Administration (SBA), a federal agency. These loans are serviced by private lenders, but are popular because they generally have good interest rates.
Line of credit
Use a line of credit as a flexible form of financing. Unlike with a loan, this option does not involve a big disbursement upfront that you must repay, providing a flexibility that better fits many entrepreneurs’ needs.
Term loan
Term loans are common small business loans in which you would apply for a large disbursement of capital and then repays it over several years, along with fixed or variable interest.
Equipment finance
With equipment financing, you receive a piece of equipment and then pay off the cost of the equipment in installments. This way, your business can make money off the equipment immediately, even if you don’t have the funds to buy it at the sticker price.
Accounts receivable financing
Accounts receivable financing is an alternative form of business financing in which your unpaid invoices serve as collateral for a lump disbursement of funds.
Colorado Small Business Loan Options
The Centennial State has a variety of lenders, banks, credit unions, and nonprofit institutions who are experienced in making loans to small businesses, especially those that add to the economic base and create jobs for the community.
Colorado Startup Loan Fund makes loans available to small businesses that are unable to obtain financing from traditional lenders.
Colorado Lending Source focuses on making loans to small businesses using the SBA 504 Loan program.
Colorado Enterprise Fund is a nonprofit organization that uses donated funds to finance small businesses that accelerate community growth.
Community Banks of Colorado serves customers across the state, offering multiple products including business term loans, business lines of credit, and SBA loans.
The Bank of Colorado is a family-owned and managed bank serving customers across the state. It offers equipment financing, lines of credit, and more to help Colorado small businesses.
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Originally a farm kid from the midwest, Lyndsey Ryan is no stranger to hard work. She grew up in an area with prevalent poverty, substance abuse, and mental health issues. Seeing so many of her friends and neighbors working so hard, yet struggling with so much pain, she was determined early on to move beyond that in order to create something that would help those around her. In 2014, she founded Integrating Insights.
At 18, Lyndsey moved away from home and spent the next 14 years working multiple jobs in various mental health organizations while putting herself through school and building relationships with community professionals. Oftentimes, as many business owners do, she sacrificed time, experiences, and even income to move her business forward. Building the company off her own hard work over the course of many years, Lyndsey spent the most recent years working 50–65 hours a week building the capital needed to expand beyond an hourly rented office to two 1500 square foot suites.
Finding Meaningful Work
Integrating Insights, based in Boulder, Colorado, is a mental health practice that helps people resolve issues related to trauma and high-stress events. Clientele and specialties include military members, veterans, and their families; couples; groups; and individuals. Armed with the lessons she learned dealing with her own health issues and the pain she witnessed growing up, Lyndsey has found a balance of meaningful work, rest, and play. Now she specializes in helping others do the same.
“My clients struggle with feeling broken, challenged in relationships, and have often turned to behaviors that seem to help momentarily, but ultimately keep them from healing,” she shares. “We all have an innate capacity towards health and wholeness, but sometimes things have occurred in our lives that stand in the way.”
Keeping a Comfortable Cash Flow
With the growth of her business came additional expenses. The expansion brought expenditures much closer to the business’s existing income levels. Lyndsey knew this would be temporary, but she needed a financial buffer while continuing to expand. Like many business owners, she used an ACH loan as a short-term way to keep a more comfortable cash flow while her practice continues to grow. With that safety net in place, she is now able to focus on her next biggest concern: the right marketing to reach clients who need her help and support.
Lyndsey and her staff at Integrating Insights have helped thousands of people. Despite the struggles, long hours, and financial sacrifices, they say the journey has been worth it.
“It has been most important for me to continue to focus on why I am running my business, and then come up with creative solutions to help it thrive,” continues Lyndsey. “Focusing on the greater good that the business provides has helped me be incredibly successful in work that I find deeply rewarding.”
A self-proclaimed beer nerd, Jose Quinones of Englewood, Colorado, isn’t just obsessed with finding rare beers and building his cellar collection. He brews his own almost every week. Inspired by the American craft beer movement and his love of homebrewing, Jose decided to turn is hobby into a business.
“After six years in retail and eleven years in the mortgage industry, I wanted to turn the skills I acquired and developed into a business that I owned. Apart from being motivated to work independently and free myself from the endless layers of bureaucracy involved in working for a multinational corporation, I wanted to pursue something I was passionate about,” says Jose.
When he heard the local homebrew supply store, where he picked up occasional shifts, was having financial difficulties and would be closing, he decided to seize the opportunity to take over the space. Jose would leverage the existing customer base, avoiding some of the worst growing pains of opening a new business.
While he was unable to acquire the original business for a variety of reasons, Jose did move into the building space, renovate it, and launch his company, Broadway Brew Supply. The bright, customer-friendly retail space with separate warehouse space for back stock and web order fulfillment is a dream come true for Jose, whose passion lies in inspiring the next group of beer brewers.
Broadway Brew Supply not only sells equipment and supplies for customers to brew beer, wine, cider, and other fermented beverages at home, but it also offers monthly classes and even private lessons to help homebrewers make beverages at home following tried-and-true practices and techniques.
Jose applied for financing through Lendio where he qualified for business credit lines that allowed him to order merchandise and to be fully stocked ahead of opening.
“[Lendio] offered counseling to maximize my credit profile to ensure I can continue obtaining financing as my business grows. The confidence with which Lendio handled my application was a relief,” shares Jose.
Though he’s been able to lean on his experiences in the corporate world to create a successful business plan and execute it, Jose’s startup journey was not without its risks and challenges. “I am betting on myself,” he says. “The idea that I can help others discover this amazing hobby and make a living doing so is what keeps me going.”
Knowing what he knows now, Jose says his best advice to other entrepreneurs is to have a business plan that is a living document. Take the time to write a thorough, well-researched business plan, but be flexible about changing it as the need becomes apparent; this includes conducting regular reviews and updates. Don’t hesitate to ask for help along the way. Consider consulting resources such as a Small Business Development Center, the Chamber of Commerce, or friends and family who have run their own businesses. And don’t forget to pay yourself; do not hire anyone until you are collecting a paycheck, he says.
America is the land of opportunity and just about any business venture is possible because of the freedom we have here. Independence Day is a time to reflect on those who made endless opportunities possible so that we all have the chance to live our own American Dream. Small businesses are the backbone of America and we want to highlight some great success stories of real-life people out there currently living their dream.
In May of 2011, Cody Hinsz had a horrible experience with an appliance company leaving him determined to do better. He wanted to make the customer experience far more pleasant than what had happened to him and decided the best way to do that would be to start his own company.
Soon after, Cody opened Denver Washer Dryer so he could offer high quality, expertly refurbished appliances to residential customers. As with many new business owners, he funded the operation entirely out of his own pocket and personal savings. This was enough capital to get him started, but not to keep him going long-term.
Knowing he wanted to create and maintain a 5-star reputation, he began to look into other financing options to increase inventory and keep his business running smoothly and came across Lendio. Soon after, he found the funding he needed to maintain that high-quality care and was able to take his business to the next level.
Let us know how you and your small business have found success and what advice you have for other small business owners in the comments below!
FAQs
What other resources are available to Colorado small businesses?
In addition to receiving financial support from Colorado’s lenders, small businesses have other resources that can help them expand and develop their businesses.
SCORE is an organization made up of volunteer, retired executives who can provide free consulting advice, training, and guidance to small businesses. The Colorado Small Business Development Center has offices spread across the state that can help small business owners find loans, raise equity capital, and network with other businesses to expand their revenue base.
What Colorado small business grants are available?
Small businesses in Colorado can apply to several Grant programs to get free money instead of loans.
Small business owners can also check the federal website, Grants.gov, to learn about any other grants that might be available for their industry and state.
What do I need to qualify for a loan in Colorado?
Your first step before applying for a loan is to decide on a business structure for your company. If you have only yourself or a few employees, a sole proprietorship may be acceptable in the beginning. In this case, you will need only to register your company’s name with the clerk of the county. If you prefer to incorporate or create a limited liability company (LLC), you’ll need to check for name availability with the Colorado Secretary of State and, if available, register with the state.
To make your lender feel comfortable when approving a loan for you, you want to assure them that you have carefully thought out how the funds will be used and have developed an ironclad plan showing how the loan will be repaid. This means presenting a carefully detailed need and justification for the loan and estimates for the cost assets being financed, such as quotes for machinery or equipment, cash flow projections, and a plan to pay back the loan, even if things don’t go as expected.
Which loan is right for my Colorado business?
The choice of which type of loan you need depends on the purpose of the loan. Long-term loans are used to finance the acquisition of fixed assets, such as equipment or real estate. Short-term loans are used to finance working capital and the company’s cash flow cycle. Quite often, short-term loans can be a line of credit or simple one-time loans with maturities of 30 or 60 days. It all depends on the ups and downs of your cash flow.
Online marketplaces, such as Lendio, have experienced financial advisors who can analyze your particular situation and structure a loan that fits your needs exactly.
How can a Colorado business loan help my business?
It’s rare for a company to have enough startup capital to begin operations and finance its growth. At some point, most small businesses need to borrow money to finance their expansion and development. Taking on a prudent amount of debt makes sense because the owner doesn’t have to give up any ownership to attract outside investors, and the cost of borrowing is cheaper than an investor’s required return on capital.
Borrowing money is the correct decision as long as the owner maintains a comfortable balance of debt to equity.
What is an SBA preferred lender?
An SBA preferred lender is a lender that’s been approved by the Small Business Administration to administer SBA loans without additional approvals from the SBA. Typically these lenders have years of experience and can approve SBA loans faster than non-preferred lenders.
What are the benefits of an SBA loan?
SBA loans are backed by the government and offer lower interest rates than other types of small business loans. They typically require a minimum time in business of two years and a credit score of 650+.
Ready for funding?
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