Small Business Funding: Tarp Banks, Goldman Sachs or Powerball?December 4th, 2009 | Online & Small Business Resources,Small Business,Small Business Tips | 1 Comment »
We’ve posted earlier about funding a start-up, talking about whether to get venture or angel investment, or self fund. So, if you go the self-funding route, small business owners face a question of dipping into their savings or seeking a small business loan. But is that really a choice for small business owners?
A recent article examined small business lending by the banks that are the Top 22 TARP recipients — which just so happen to be the largest lenders to small businesses. According to CNN, though TARP was intended to provide liquidity to small businesses as well as large, it’s just not happening. The top TARP recipients have trimmed back lending to small business by over $8B. Though the new administration required $15B be set aside for small business lending, that money has gone untouched.
So if a small business can’t get a loan, what about a charitable fund for small business? Doesn’t exist, right? Well, maybe not. For 10,000 businesses, there is a chance for a cool $50k gift card…thanks to Goldman Sachs. Goldman, with the encouragement Warren Buffet, has created a $500M fund to benefit 10,000 small businesses — providing access much needed liquidity. Some media outlets are a bit cynical about Goldman’s motivations, but really what does it matter? Goldman paid back its TARP funds and really didn’t have to create the small business fund.
If your business can’t get a loan, and doesn’t luck out with the Goldman Sachs free money give-away, there is also the Powerball — with a 1:195M chance to win. Or, you could do what KikScore is planning — a lemonade stand offering $100k organic lemonade. It only takes one customer.
Let us know if your business has had any good or bad experience in obtaining a small business loan/credit line.