SAGUACHE COUNTY — In a virtual event, hosted by 1st SouthWest Community Fund and the Rural Community Assistance Corporation (RCAC), small business owners were presented some of the non-traditional methods of securing funding for their business.

Also discussed was how to secure financing for start-ups and several resources were given for people wanting to open a business in the San Luis Valley.

According to its website, “RCAC is a non-profit organization that provides training, technical and financial resources, and advocacy so rural communities can achieve their goals and visions.”

RCAC small business loans help businesses retain or create jobs in our area by providing working capital, equipment loans, expansion loans, construction loans, capital improvements, and help with cash flow issues. The 1st SouthWest Community Fund is a non-profit organization that is connected to 1st SouthWest Bank.

Cass Walker of 1st SouthWest Community Fund said, “We help businesses access affordable capital, primarily done through loans, which range from $5,000 to $50,000.”

General funding is available including working capital, and funding is also available for specific areas of interest including woman-owned, minority-owned, or veteran-owned businesses. The non-profit partners with the bank to help these businesses gain access to capital, a process that can be confusing or even intimidating to small business owners. There are lots of different loan programs available for small businesses across all types of industries.

Currently, they have a reemerging loan program, as a direct response to COVID-19 shutdowns which is called the Relief Loan. This loan is for currently operating businesses, for up to $25,000 at 3% interest and for 6 months the payments are deferred. After the deferment period, the business will be evaluated to see if they are able to repay, have the payments deferred again, or have the loan forgiven.

An opportunity for start-up businesses to get access to funding is the KIVA loan which is a 0%, no-fee loan that is crowd-funded. To gain access to this type of non-traditional funding, the start-up is community funded with each person in the community needing to contribute $25 each, with a minimum of at least 40 people.

After this initial community investment, the start-up idea is then offered to international and domestic investors. Any money the businesses are able to raise through this crowd-funding is matched. RCAC helps the start-ups manage this process.

Non-traditional funding sources are often the most common funding for small businesses as many people do not have access to traditional loans such as startups, those who do not have enough collateral or those who have credit issues. Many of their small business loans do not have a minimum credit score, and they also offer credit counseling to help raise an individual’s credit score since business loans are often denied by traditional lenders due to poor credit.

They also offer business coaching to help businesses look at their finances in order to help them be successful. They also noted that small business centers are now offering most of their services free of charge including help with business plans and logistics.

People with current small businesses or wanting to start a business in the SLV are encouraged to go to the RCAC website and the 1st SouthWest Community Fund website to obtain more information.