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Frequently Asked Questions (FAQ) Where can I get business license information? I want some of that free grant money that I am always hearing about… How can I finance my start-up business? How can I get an SBA loan? How important is my credit score when I am seeking a commercial loan? Would you answer to the grant questions above still be the same if I said I was a minority? A woman? A veteran? Disabled? Do I have to have experience in the business I am considering in order to have a reasonable chance of success? Who are the most important key advisors for my business? If there is one item I should focus on to make my odds of success the greatest, what should it be? Toll-Free Numbers
BUSINESS QUESTIONS
Some states require all businesses to have a generic business license. Ohio, however, does not. Our business information kit will explain the licenses and permits required for the specific business you want to start.
Do you have grants? Where do I get grant information?
This is an urban myth type question. While there are thousands of grant programs across the country, most are not targeted toward for-profit businesses. Careful research may reveal small, isolated opportunities in specific markets. However, as a general rule, grant dollars are not available to help start a small business. The federal website for grant programs is www.grants.gov, or you may want to ask your local library for a copy of The Grants Guide.
Most businesses are financed out of a combination of owner's equity (owner's investment) and a commercial loan. If an entrepreneur were seeking a commercial loan, a reasonable expectation would be that the lending bank would expect at least 20 percent of the needed dollars would be from the entrepreneur.
The U.S. Small Business Administration (SBA) programs are designed to encourage commercial lenders to make loans directly to business owners and entrepreneurs. The SBA does not make direct loans. Contact your local Small Business Development Center (SBDC) for assistance. The SBDCs are staffed with highly trained business advisors who offer FREE counseling to help with your specific business needs. The local list can be found at www.entrepreneurohio.org.
A borrower's credit score is very critical to the approval of a commercial loan. While there are occasional exceptions, most lenders want a credit score of 650 or better for a commercial loan. In addition, a recent bankruptcy (last 7 years) is almost always a stumbling block.
Yes.
Not to dwell on negatives, but there is a high failure rate for start-up businesses. Your odds of success are going to be much greater if you are taking on risks that you understand as opposed to risks you do not understand. If you are going to need a loan to get your business started, most lenders will strongly prefer that you are experienced in the new business.
Key advisors should be k knowledgeable about small business issues in general and about your specific type of business in particular. Over the long haul, you will benefit the most from a good accountant, a good attorney, a good insurance agent and a good banker. You should also include the business advisor from your local Small Business Development Center (SBDC).
Entrepreneurs and business owners who understand and are dedicated to good planning are usually among the most successful. Be prepared to dedicate many hours to build the success of your business. Your business plan should be your guide along the journey to success.
© 2006 State of Ohio Department of Development
