Small Business Loans in Colorado

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    Colorado

    Small Business Loans Colorado: Explore the Best Business Financing for Your Company

    Colorado is one of the fastest-growing states in the United States. Not only is its population growing, but the state’s economy is also showing signs of flourishing, as evidenced by more than 600,000 business thriving businesses in the state. 

    Professional and technical services, real estate, construction, and retail, among the others, are the most prevalent businesses in the country. Colorado’s network of small businesses employs more than 1.1 million workers, which makes up 50% of the state’s workforce. 

    Colorado has received much recognition in the past and until now. In fact, it currently ranks no. 8 in CNBC’s list of Top States for Business and no.1 in labor supply in 2019. With that, businesses in Colorado must continue to find ways to set their business up for success. Colorado Business Loans can fund product expansions, marketing strategies, and more. 

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    Tourism and Hospitality Loans in Colorado

    Tourism is the largest service industry in Colorado. In 2019, the state welcomed more than 86.9 million visitors. The sector also supports more than 180,000 jobs in Colorado. The Centennial State’s tourism industry mainly generates sales through accommodation, visits to attraction sites, and people engaging in sports like skiing, hiking, and mountain climbing. Besides leisure, business tourism in Colorado is also slowly gaining some traction, and it’s expected to become one of Colorado’s primary sources of revenue in the future. 

    With the help of small business financing in Colorado, tourism and hospitality businesses in the state can fund certain business initiatives to accommodate more clients and increase their revenue. Whether they’re looking to fund construction, renovations, improvements, or buy equipment and machinery, there’s the right Colorado business loan fit for their business need. 

    Construction Companies in Colorado

    Business lines of credit are among the most flexible business financing options for Colorado businesses. For construction companies that often experience cash flow gaps, a line of credit can be excellent financing of choice as it gives them access to capital on an as-needed basis. This way, they can continue funding their projects and avoid delays. 

    SMB’s credit lines can range from $10,000 to $5,000,000, and the repayment terms can be as long as ten years. The best thing about Colorado Business Lines of credit is that you only have to pay back the amount you borrowed, plus the interest on that amount. Every time you pay, your credit line returns to its original amount, and you can reaccess the funds if needed. They can use the proceeds towards any business needs, including covering cash flow gaps, payroll, buying/leasing equipment, etc.  

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    Best Local Funding Options for Colorado Small Businesses

    When researching the best places to get a Colorado business loan fund, you’ll probably come across two options: alternative and traditional lenders. Between the two, banks offer the most affordable rates, but they’re the most difficult to qualify for. On the other hand, alternative loans are generally easier to qualify for, especially if you’re working with a low credit score.

    Below we’ll break down some of the best Colorado small business loan providers.

    Bank of Colorado

    With a century's worth of experience in business lending, the Bank of Colorado is among the best places to get financing if you run a company based in Colorado. The bank also has a BBB rating of A+, offering several business loans that fit any business need. This includes:

    • Business lines of credit
    • Commercial loans
    • Real estate financing
    • Equipment loans

    Colorado’s agriculture sector also contributes to the majority of the state’s economy. But agricultural business loans in Colorado can be difficult to secure. On the other hand, the Bank of Colorado offers loans for agribusinesses in the state, such as livestock loans for farmers.

    If you decide to move forward with your application, the bank requires its borrowers to pledge collateral. While real estate and equipment are ideal, they also accept other assets like invoices and inventory.

    Colorado Enterprise Fund

    Colorado Enterprise Fund is a non-profit lender specializing in commercial loans in Colorado state. Since 1976, the financing institution has approved more than 2,000 loans to small businesses in Colorado.

    One thing that makes Colorado Enterprise Fund an ideal lender is that they have specialized loans for specific niches. For instance, the Healthy Foods Fund Program offers $500,000 to food trucks, grocery stores, and other food-related industries. They also provide other business loan options such as:

    • Dream Big microloans
    • Step Up microloans
    • VALOR Loans for veterans
    • Just in Time lines of credit
    • GAP Loans
    • Commercial real estate loans

    Community Banks of Colorado

    One thing that makes the Community Bank of Colorado stand out among the others is that the bank focuses on extending credit to hard-to-fund (and, therefore, riskier) businesses. This includes companies in the healthcare industry, agriculture, and community associations. Some private medical practices may get up to 100% funding when acquiring an existing medical practice.

    With that being said, if you’re a physician looking to open or expand your practice or a farmer looking for a capital boost, the Community Banks of Colorado can be an excellent place to get a small business loan.

    Online Lenders

    An online lender like SMB Compass can help you find the best business loans for your business based on your preferences and qualifications. Our fully automated application process only takes a few minutes to fill out, and if you're a good fit, we'll connect you with a financial advisor to help you throughout the entire process at no cost on your part.

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    What are the Best Colorado Small Business Loans?

    As a small business owner, you have a variety of options when it comes to choosing the best financing for your business. Their options include:

    Business Line of Credit

    A business line of credit is structured like a credit card and provides small businesses with easily accessible working capital. Lenders assign you a predetermined credit limit, and you can withdraw money from it anytime, given that you don't exceed the limit.

    Unlike conventional loan funds, you only need to repay the amount you've withdrawn (plus interest) in a business line of credit.

    It's an excellent solution for business owners who want to set up an emergency fund or companies that need a continuous flow of cash.

    Invoice Financing

    Invoice financing allows businesses to sell unpaid invoices to a financial institution for immediate funding. Lenders typically give you up to 90% of the total invoice value upfront. Once your customers have paid their invoices, you can repay the amount advanced to you, minus a small fee.

    Invoice financing lets you free up cash tied to pending invoices, so you won't have to wait months to receive the money.

    Inventory Financing

    Inventory financing uses your inventory as collateral to secure capital to grow your business. This means you don't need to risk losing other business or personal assets in case you default on the loan.

    The loan amount, terms, and fees depend on your credit report, inventory quality, cash flow, customer base, and inventory churn. Lenders typically advance up to 80% to 90% of your inventory's appraised value.

    Equipment Financing

    Equipment financing is a great option for industries that rely heavily on equipment, like construction, healthcare, hospitality, and agriculture businesses. Lenders give you the necessary resources to purchase or lease much-needed equipment, including heavy machinery, company vehicles, and furniture and fixtures. The equipment is the collateral for the loan, so you don't have to pledge your personal and business assets.

    Asset-Based Loans

    Asset-based loans are best for companies with valuable assets on their balance sheets. Unlike a conventional loan, asset-based funding relies on the value of your assets instead of business credit and cash flow. You can use the following assets in exchange for working capital: equipment and machinery, inventory, accounts receivable, purchase orders, commercial real estate, intellectual property, or marketable securities. Asset-based loans offer a better chance of approval because the collateral lowers the lender's risk.

    SBA Loans

    The Small Business Administration created SBA loans to help small business owners qualify for bank-rate financing. The SBA guarantees up to 85% of the loan, which lowers lenders' risk, making them more likely to fund your business.

    Most small businesses apply for SBA loans because it offers competitive interest rates, high loan amounts, and extended repayment periods compared to other business loan options.

    However, small business owners applying for an SBA loan must have a good credit score (680 or higher), a comprehensive business plan (outlining business goals), and an established business history.

    Business Term Loans

    A business term loan is perfect for small businesses in Colorado that prefer a familiar form of financing. You receive a lump sum of money typically repaid in fixed installments, plus interest, but some lenders may ask for weekly or bimonthly payments.

    Many small businesses apply for term loans because they have flexible terms. You can use them for almost any business expense, including inventory purchases, utility payments, and other overhead costs.

    Business Funding and Grants in Colorado

    LEADING EDGE

    LEADING EDGE is a business grant focused on businesses owned by women, minorities, and veterans. The grant recipient can get up to $10,000 worth of funding which they can use for export costs. Specifically, they can use the funds to pay for foreign exhibits and conferences, overseas advertising, etc. 

    To be eligible for the grant, the small business applicants must be:

    • Mainly based in Colorado

    • 51% minority, women, or veteran-owned

    • Have 100 or fewer employees

    • Operating for at least one year

    • Registered with Colorado’s Secretary of State

    Collaborative Infrastructure Grant

    The Collaborative Infrastructure Grant supports Colorado’s advanced industries, like research and development, technology, manufacturing, and supply chain management. The grant is administered by The Global Business Development together with Colorado’s advanced industry trade association and Economic Development Commission. 

    The grant aims to drive and accelerate the commercialization and innovation of these advanced industrial products. Qualified businesses can get between $50,000 to $500,000 in funding, which they can use to develop new large-scale projects. 

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    Apply for Colorado Small Business Loans Today

    Running a small business in Colorado is challenging yet fulfilling at the same time. The state offers many growth opportunities and resources to help small business owners grow their businesses.

    At SMB Compass, we're also here to help. If you need more information on various financing products in Colorado, don't hesitate to give us a call at 888-853-8922 or send us an email at [email protected] We'll connect you to one of our financial advisors at no cost on your part.

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