ksbdc louisville funding sources for business

P i e c i n g t o g e t h e r a F u n d i n g s t r a t e g y

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2 K S B D C M o n e y S o u r C e S D i r e C t o r y

i n t r o d u c t i o n

in today’s business environment entrepreneurs need comprehensive and

up-to-date information about finance and funding. Whether financing an

innovative start-up or growing a mature business, sources of funding are not

always easy to find. While the most common source of funding is a loan from

a bank, many start-up’s cannot provide the security needed to borrow in

today’s tight credit environment and need to find alternative sources such as

special loan programs, crowdfunding, grants and business investors.

Any business needing additional funding will usually find that they need to

assemble any number of financing pieces almost as if they are assembling a

puzzle. that is why we are launching this revised edition of sources of funding to

assist business leaders and entrepreneurs in finding the funding sources available

to both start-ups and mature businesses. We’ve included private equity, state

and local grants, incentives as well as conventional debt financing.

We hope this publication will help business owners and entrepreneurs like

you continue to create jobs and drive our economy forward.

3

David Oetken, MBACenter DirectorLouisville Small Business Development [email protected]/Louisville

KSBDC helps you

find alternative funding

sources such as

special loan programs,

crowdfunding, grants and

business angels

K S B D C M o n e y S o u r C e S D i r e C t o r y


t a B L e o F c o n t e n t s – M o n e y s o u r c e s

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About KSBDCKSBDC Leadership

Federal Government

Small Business Administration7(a) Loan Program international trade Loans export Working Capital Program CAPLines Program LowDoc Loans SBAexpress SBAexportXpress Patriot express 504 Loan Program Small Business investment Company (SBiC)MicroLoan Program Pre-Qualified Loan Program

uS Dept of Housing and urban DevelopmentCommunity Development Block Grant Loans (Section 108 Program)

uS Dept of Agriculture Business and industrial Guaranteed Loans Business and industrial Direct LoansGuaranteed Farm ownership/operation LoansDirect Farm ownership and operating Loans

export-import Bank of the united StatesWorking Capital Loan Guarantee Program

Small Business innovation research Program

State Government

Kentucky economic Development CabinetKentucky economic Development Finance Authority Direct Loan Program industrial revenue Bond Financing Small Business Credit initiatives

incentive ProgramsKentucky rural economic Development Act (KreDA) Kentucky Jobs Development Act (KJDA) Kentucky industrial Development Act (KiDA) Kentucky economic opportunity Zone Program (KeoZ) Kentucky investment Fund Act (KiFA) Linked Deposit Loan Program

office of the new economyinnovation and Commercialization Centers rural innovation Fund research and Development Fund Kentucky Commercialization Fund

Local Government

Area Development Districts tVA Loans: Southwestern Kentucky rural electrification Loans (reA) Mountain Association for Community economic Development (MACeD)

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Private Capital

Alliance Group Blue equity evermore investments, LLC Futurity investment Group Pattco Ventures yearling Fund Anchorage Angels

Venture Capital

Chrysalis Ventures LLC Mountain Ventures inc Venture Connectors Village Ventures inc office for the new economy Draper triangle Ventures Heron Capital Allos Ventures river Cities Capital Funds triathlon Medical Ventures uPS Strategic enterprise Fund

Seed Funds

Commonwealth Seed Capital Kentucky Seed Capital Fund Cardinal Venture Fund Vogt Awards Venture Connectors

t a B L e o F c o n t e n t s – M o n e y s o u r c e s

Angels

enterprise Angels innovation Angels Louisville Angel investor network Bluegrass Angels & Bluegrass Angel Venture FundsQueen City Angels

Crowdfunding

Kickstarter.com indiegogo.com rockethub.com

Mezzanine Financing

Non-Profit Organizations

Kentucky Highlands investment Corp Human/economic Appalachian Development MetCo Community Services & revitalization Microenterprise Loan ProgramSouthern Kentucky economic Development Corporation

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Kentucky Small Business Development Center (KSBDC) is a network of regional centers

throughout the Commonwealth dedicated to growing and improving Kentucky’s small

business community. our mission is to strengthen Kentucky businesses and create

economic growth by providing excellent management assistance, educational programs

and helpful resources for Kentucky’s small business owners and entrepreneurs. KSBDC

is a partnership between institutions of higher education, economic development

organizations and the u.S. Small Business Administration. We serve the Counties of:

Bullitt, Carroll, Henry, Jefferson, oldham, owen, Shelby, Spencer and trimble.

PlanningKSBDC provides valuable tools to help entrepreneurs make informed business decisions

when planning to open a new business, purchase an existing business or expand an

established business. each KSBDC service center has access to:

• Market Research

• Industry Profiles

• Sample Marketing Plans

a B o u t K s B d c

The Louisville SBDC

provides one-on-one

consultations at no cost

to existing and potential

entrepreneurs in the

Louisville region.

BlueMoon Winery Grows From Kentucky VineyardAfter eight years growing grapes on her farm in Marion County,

Alex Ackermann decided to expand her business and open the

first winery in the county. KSBDC was there. Read more success stories at http://ksbdc.org/category/success-stories/

• Demographics

• Business Books


Consulting for Louisville Area BusinessesKSBDC offers free one-on-one consulting services. All of our management

consultants have broad-based skills and significant experience as business owners

and/or managers. our consultants are qualified to answer questions and address a

variety of topics, including:

• Comprehensive Business Planning

• Cash Flow Projections

• Market Planning and Research

• Organizational Structure

• Staffing Needs

• Record Keeping

• Human Resource Issues

• Cash Flow Management

• Financial Analysis

• Customer Retention Strategies

• Certification for Minorities & Women

• Technology Commercialization

TrainingKSBDC offers affordable training workshops designed to provide early stage and

existing business owners with the knowledge required to maintain and expand

a successful business. A listing of training workshops currently being offered

throughout the KSBDC network is available by visiting www.ksbdc.org. numerous

self-paced on-line training courses are also accessible on our Web site.

Funded in part through a cooperative agreement with the u.S. Small Business Administration. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of SBA. Disability accomodations should be requested by contacting your local SBDC.

The Louisville SBDC

meets the educational

needs of the local small

business community by

offering a variety of low

cost training programs

taught by industry experts

and qualified SBDC

Consultants.

a B o u t K s B d c


K s B d c L e a d e r s h i P

David OetkenDirector, Louisville SBDC Dave oetken has worked with the KSBDC for since 2011. Dave began his business career in the sports/entertainment industry, primarily in ice skating and ice hockey. He has owned and managed three ice rinks and was named the Manager of the year award from the ice Skating institute of America. Dave was operations manager for several professional ice hockey teams in both the east Coast Hockey League and the American Hockey League. He has owned, operated and sold several businesses in the food industry. He moved into the restaurant field, owning and operating a number of franchise concepts. Since 2005 he has owned Louisville news company, one of the largest distributors of thoroughbred horse publications in the eastern united States. David has a B.A. and M.B.A. from Bellarmine university. He remains active in his community, serving as a SCore volunteer since 2003 and is a past vice chair for GLi’s Small Business innovation Committee.

[email protected]

Toni SearsAssistant Director, Louisville SBDCtoni Cardell has worked with the Louisville SBDC for five years. Prior to joining the KSBDC, she served as project director for the Louisville Minority Business Development Center and housing director for Sullivan university. toni holds and M.B.A. and a B.A. in english, both from the university of Louisville. She is a twice recipient of the Million Dollar Loan Club, a distinction honoring KSBDC consultants who have secured more than $1 million in loans. toni volunteers with Middle School Connection and Big Brothers Big Sisters of Kentuckiana. When not at work, toni enjoys reading, volunteering, exercising and attending plays and sporting events.

[email protected]

Vallorie HendersonAssistant Director, Management ConsultantVallorie Henderson began working with the Kentucky SBDC in August of 2011. Prior to joining the team in Louisville, Vallorie served as the business development director for the Kentucky Arts Council in Frankfort for 10.5 years. She holds a B.A. from Berea College

in Berea, Kentucky and a M.F.A. from Miami university in oxford, ohio. Vallorie has over 25 years of experience in marketing and promotion with such regional organizations as the Speed Art Museum and the indianapolis Children’s Museum. She owns and actively markets her own fiber arts studio on both a national and international level. Vallorie’s own success in marketing and selling her artwork allows her to relate to individual business owners on a very personal level. Assisting small business owners in understanding how to grow their revenue streams is high on Vallorie’s list of priorities. She also serves on the Board of Directors for Just Creations, a fair trade retail outlet in Louisville. She has traveled internationally to work with artisan entrepreneurs in growing their businesses and to assure they are paid a living wage.

502-625-0126 [email protected]

Janet FlaughCommunication Coordinator, Louisville SBDCJanet Flaugh has worked with the Louisville SBDC for five years. Before joining the KSBDC she served as director of volunteer services for the Kentucky Center for the Arts. Janet has a B.A. in Psychology from indiana university. She is active in her community, serving as a volunteer for the Floyd County Animal rescue League. When not at work, Janet enjoys camping, hiking, kayaking/rafting and nature photography.

[email protected]


F e d e r a L g o v e r n M e n t M o n e y s o u r c e s

US Small Business Administration

US SBA: 7(a) Loan Guaranteethe most basic and most frequently used SBA program is the 7(a) Loan Guarantee. there are three essential parties to an SBA-guaranteed loan; SBA, the borrower, and the lender (usually a bank). Small business owners and entrepreneurs interested in an SBA guarantee must submit a loan application to the lender institution. if the lender finds the applicant needs additional support, it forwards the application to the nearest SBA office for credit analysis. if approved by the SBA, the lender then closes the loan and disburses the proceeds.

Qualification as a small business is based on the average number of employees for the preceding 12 months or on sales volume averages over a three-year period. in addition, borrowers must demonstrate the ability to repay and be willing to pledge sufficient assets to secure the loan. new businesses may be required to put up one-third or even one-half of the total assets needed to get started. Finally, the business must be unable to obtain financing on reasonable terms without the guarantee.

Loans under this program may be guaranteed up to 85 percent. However, the maximum guarantee on loans exceeding $150,000 is 75 percent. the maximum

Federal Government Money Sources

amount SBA can guarantee for any one borrower is $3,750,000. interest rates on the guaranteed loan program are negotiated between the lender and the borrower and are subject to SBA maximums. Generally, the interest rate is 2.25-4.75 percent over the Prime interest rate, depending on loan amount and maturity of the loan. Maximum maturity is 25 years to finance the purchase of fixed assets. Most small businesses who borrow working capital can expect a maturity of five to ten years.

Borrowers may use the proceeds from a 7(a) loan for expansion, renovation, construction, or purchase of land or buildings, to purchase machinery, equipment, fixtures, to augment working capital and to refinance existing debt under special conditions.

Special purpose loan programs under the SBA Guarantee:

International Trade LoansSBA provides guarantees to businesses that are engaged in international trade, preparing to engage in international trade, or can show that they are suffering from direct import competition. the SBA can guarantee up to 90% of $5 million in combined working-capital and fixed-asset loans. none of the loan proceeds can be used for debt refinancing. Financing fees and interest rates are similar to the 7(a) Guarantee program schedule.

Export Working Capitalexporters seeking short-term working capital may be eligible for a 90 percent guarantee of the principal and interest, with the maximum loan amount being $5 million. the one page application form can turnaround within 10 days.

CAPLines Programthe SBA will guarantee 85 percent up to $5,000,000 with four short-term working-capital programs. the programs are Seasonal Line, Contract Line, Builders Line and Standard Asset-Based Line. the Small Asset-Based Line is an asset based $200,000 revolving line of credit.

LowDocLowDoc offers a simple one page application form with processing in two or three days for loans of up to $150,000, with 85 percent guaranteed.

SBAExpressPreferred lenders may provide SBA guaranteed small business loans of $350,000 or less with a 50 percent guarantee. the loans are processed and serviced through experienced, authorized lenders. Loans under $25,000 do not require collateral. use of proceeds follow the same guidelines as the 7a program.


s B a P a r t i c i P a t i n g L e n d e r s

Branch Banking & Trust5901-C Peachtree Dunwoody rd Suite 420Atlanta GA 30328770-551-8822

JP Morgan Chase416 West Jefferson StLouisville, Ky 40202502-566-3671

Clinton Bank220 east Clay StClinton, Ky 42031270-653-4001

Commonwealth Bank & Trust4912 u.S. Hwy 42Louisville, Ky 40222502-259-2469

Community Trust Bank346 north Mayo tracePikeville, Ky 41501606-432-1414

Cumberland Valley National BankP.o. Box 709London, Ky 40743606-878-7010

Edmonton State Bank213 north Main Streettompkinsville, Ky 42167270-487-6123

Farmers Bank & Capital Trust125 West Main StreetFrankfort, Ky 40602502-227-1615

Fifth Third Bank401 South Fourth StreetLouisville, Ky 40202502-562-8162

Fifth Third Bank of Northern Kentucky8100 Burlington PikeFlorence, Ky 41042859-283-8222

First Community Bank of Western Kentucky114 east Jackson StreetClinton, Ky 42031270-653-4301

First Federal Savings Bank of Elizabethtown2323 ring roadelizabethtown, Ky 42702270-765-2131

First Financial Bank225 Pictoria Drive Suite 800Cincinnati, oH 45245513-551-5770

First Kentucky Bank, Inc. 223 South Sixth StreetMayfield, Ky 42066270-251-4960

First Security Bank of Owensboro, Inc.300 Frederica Streetowensboro, Ky 42301270-688-4699

First Southern National Bank102 West Main StreetStanford, Ky606-365-6971

FNB Bank, Inc.101 east BroadwayMayfield, Ky 42066270-251-6058

Forcht Bank, NA2404 Sir Barton WayLexington, Ky 40509502-267-0870

Heritage Bank4155 Lafayette roadHopkinsville, Ky 270-887-2999

Hometown Bank of CorbinP.o. Box 1323Corbin, Ky 40702606-528-2000

KeyBank, National Association303 Broadway Street, 17th FloorCincinnati, oH 45202513-830-1275

Kentucky Bank401 Main StreetParis, Ky 40361859-987-1795

Kentucky Neighborhood Bank1000 north Dixie Avenueelizabethtown, Ky 42701270-765-4072

Magnolia Bank, Inc.6512 West Dixie Avenueelizabethtown, Ky 42701270-765-4072

PBI Bank949 South Dixie HighwayMunfordville, Ky 42765270-524-7283



Peoples Exchange Bank48 Center StreetBeattyville, Ky 41311859-744-9400

Planters Bank, Inc.1312 Main StreetHopkinsville, Ky 42240270-886-9030

PNC Bank Kentucky, Inc.Citizens PlazaLouisville, Ky 40296513-956-5159

Regions Bank, N.A.117 West Cedar StreetFranklin, Ky 42134800-734-4667

Republic Bank & Trust Company661 South Hurstbourne ParkwayLouisville, Ky 40222502-394-4443

South Central Bank of Barren County208 South BroadwayGlasgow, Ky 42141270-651-7466

South Central Bank of Bowling Green, Inc.1757 Campbell LaneBowling Green, Ky 42102270-782-9696

South Central Bank of Hardin County4079 north Dixie Highwayelizabethtown, Ky 42701270-763-9797

South Central Bank of Monroe County320 north Main Streettompkinsville, Ky 42167270-487-6117

Stockyard Bank & Trust Company1040 east Main StreetLouisville, Ky 40206502-625-2485

The Bank – Oldham County Inc.515 South First StreetLaGrange, Ky 40031502-222-2100

The Commercial BankP.o. Box 7Grayson, Ky 41143606-474-7811



The Farmers National Bank of Scottsville107 north Court StreetScottsville, Ky 42165270-783-8300

The Huntington National Bank710 east Main StreetLexington, Ky 40502859-361-8764

The Paducah Bank and Trust Company555 Jefferson StreetPaducah, Ky 42001270-575-5796

The Peoples Bank201 north Bardstown roadMt. Washington, Ky 40047502-538-6060

The Sacramento Deposit BankP.o. Box 26Sacramento, Ky 42372270-736-2212

Town & Country Bank and Trust CompanyP.o.Box 305Bardstown, Ky 40004502-348-3911

Traditional Bank, Inc.49 West Main StreetMount Sterling, Ky 40353859-498-0414

UPS Capital Business Credit425 Bay Hill roadWinsor, Ct 06095860-687-2699

United Citizens Bank & Trust CompanyP.o.Box 250Campbellsburg, Ky 40011502-732-6669

US Bank, N.A.6010 Brownsboro Park Blvd Suite CLouisville, Ky 40207502-893-4223

Whitaker Bank, Inc.P.o. Box 55439Lexington, Ky 40555859-543-4000

Wilson & Muir Bank & Trust Company107 north third StreetBardstown, Ky 40004502-348-5996

SBAExportXpressBusinesses who can demonstrate that loan proceeds will be used to enter a new export market or expand an existing export market and have been in operation for 12 months may be eligible for 85% guarantee for a maximum loan amount of $150,000.

Patrick Hayesregional Manager, export Solutions Groupoffice of international tradeu.S. export Assistance Center600 Superior Ave., Ste. 700Cleveland, oH 44114216-522-4731 • 216-522-2235 [email protected]



Patriot ExpressVeterans and members of the military community may be eligible for Patriot express loans which feature the SBA’s lowest interest rates for business loans, generally 2.25 to 4.75 over prime depending the size and maturity of the loan. Proceeds can be used for most business needs, including preparing your business for your deployment.

Branch Banking & Trust Co.5901-C Peachtree Dunwoody rd.Atlanta, GA 30328770-551-8822Ankur Patel

JP Morgan Chase Bank416 W. Jefferson St.Louisville, Ky 40202502-566-3671Jason Adler

Citizens Bank & Trust Company201 e. Main St.Campbellsville, Ky 42715270-465-8193

Community Trust Bank, Inc.346 n. Mayo tr.Pikeville, Ky 41501606-437-1414terry Spears

Edmonton State Bank213 n. Main St.tompkinsville Ky 42167270-487-6123tony High

Farmers Bank & Capital Trust125 W. MainFrankfort, Ky 40602502-227-1615Jonathan Mays

Fifth Third Bank401 S. Fourth Ave.Louisville, Ky 40202502-562-8162Kathy Pleasant

First Financial Bank225 Pictoria Dr., Ste. 800Cincinnati, oH 45246513-551-5770Glenn Clevenger, VPManager – SBA Lending

First Security Bank of Owensboro300 Frederica St.owensboro, Ky 42301270-688-4699Kevin roark

First Southern National Bank102 W. Main St.Stanford, Ky 40444606-365-6971Doug Daniel

FNB Bank, Inc.101 e. BroadwayMayfield, Ky 42066270-251-6058Pat Bynum

Forcht Bank, N.A.2404 Sir Barton WayLexington, Ky 40509502-267-0870Creighton reiss

Heritage Bank4155 Lafayette rd.Hopkinsville, Ky 42240270-887-2999roger Grogan

Kentucky Neighborhood Bank1000 n. Dixie Ave.elizabethtown, Ky 42701270-737-6000Brad Burchett

KeyBank, National Association303 Broadway St., 17th Fl.Cincinnati, oH 45202513-830-1275Steve Brooks

PBI Bank949 S. Dixie Hwy.Munfordville, Ky 42765270-524-7283Kenneth Kidd

Peoples Exchange Bank48 Center St.Beattyville, Ky 41311606-464-3631Allan turner

Planters Bank1312 Main St.Hopkinsville, Ky 42240270-886-9030 ext. 1732Janet Calhoun

PNC, N.A.Citizens PlazaLouisville, Ky 40202513-956-5159rob Haskins



Regions Bank250 riverchase Pkwy., rCS 1, BLCHoover, AL 35244202-560-3344David Lee

Republic Bank & Trust661 S. Hurstbourne Pkwy.Louisville, Ky 40222502-394-4443Karen Berry

South Central Bank of Barren County208 S. BroadwayGlasgow, Ky 42141270-651-7455Kelcey rock

South Central Bank of Hardin County4079 n. Dixie Hwy.elizabethtown, Ky 42701270-763-9797Josh thompson

South Central Bank of Monroe County320 n. Main St.tompkinsville, Ky 42167270-487-6117Brian Clemmons

Stock Yards Bank & Trust Company1040 e. Main St.Louisville, Ky 40206502-625-2485Scott Parrott

The Commercial BankP.o. Box 7Grayson, Ky 41143606-474-7811Jack Strother

The Huntington National Bank710 e. Main St.Lexington, Ky 40502859-361-8764Chris Jackson

The Paducah Bank and Trust Company555 Jefferson St.Paducah, Ky 42001270-575-5796Kerri Brotherson

The Peoples Bank201 n. Bardstown rd.Mt. Washington, Ky 40047502-538-6060Denise Laferty

Traditional Bank, NA49 W. Main St.Mt. Sterling, Ky 40353859-498-0414Spears Stilz

United Citizens Bank & Trust CoP.o. Box 250Campbellsburg, Ky 40011502-732-6669roy Weeks



Community Ventures Corp. - Frankfort306 W Main St, Ste 706 Frankfort Ky 40361502.696.9444Fax: 502.696.9493www.cvcky.org

Community Ventures Corp. - Paris509 High StParis Ky 40361859.340.4028Fax: 859.340.4052www.cvcky.org

Purchase ADD, Inc.1002 Medical DrMayfield Ky 42066270.247.7171www.purchaseadd.org

Small Business Investment Companiesthe Small Business investment Company (SBiC) program provides venture capital to small businesses for start-up and growth. SBiCs are for-profit, privately owned investment firms licensed by the SBA. SBiCs provide equity capital, long-term

loans, and management assistance. there are two types of SBiCs; regular and specialized (SSBiC). Specialized SBiCs invest in small businesses owned by socially and economically disadvantaged entrepreneurs. to be eligible for SBiC or SSBiC financing, firms must meet the SBA’s definition of a small firm.

Kentucky Small Business Investment Companies

Chrysalis Ventures, LLC101 South Fifth St, Ste 1650Louisville Ky 40202502.583.7644Fax: 502.583.7648www.chrysalisventures.com

Mountain Ventures Inc.P.o. Box 1738London Ky 40743-1738606.864.5175Fax: 606.864.5194www.khic.org

The Micro-Loan Programsthe SBA distributes funds to private, non-profit groups who serve as intermediary lenders. SBA helps fund micro-loan programs to provide business access to small loans usually from $100 to $35,000. Several Kentucky organizations can assist with micro-loans.

Kentucky Micro-Lenders

Community Ventures Corp. –Bowling Green2413 nashville rd, Ste 114Bowling Green Ky 42101270.904.0323Fax: 270.904.0505www.cvcky.org

US Bank, N.A.6010 Brownsboro Park Blvd., Ste. CLouisville, Ky 40207502-893-4223Brandon Prather

Wilson & Muir Bank & Trust Company107 n. third St.Bardstown, Ky 40004502-348-5996Karen McGraw

Certified Development Company (504) Loan Programthis program finances the purchase of fixed assets including land, buildings, machinery and equipment, and modernization or renovation of existing facilities. CDC funds cannot be used for working capital, inventory, consolidation or repayment of debt, refinancing, or financing a plant outside the u.S. and its territories. typically, a lender institution finances 50 percent of the project, while the CDC contributes 40 percent. the remaining 10 percent must come from the borrower. Start-ups can expect to put 15 percent up front, with a 35 percent contribution from the CDC. A business must have a net worth of $7 million or less, and an average net profit after taxes for the previous two years of $2.5 million or less. For every $35,000 of invested CDC funds, one job must be created, retained or meet a public purpose criteria.

504 Lenders Capital Access Corp. - KY401 W Main St, Ste 2010Louisville Ky 40202502.584.2175Fax: 502.584.2173www.cac-ky.org

Community Ventures Corp. - Lexington 1450 n. BroadwayLexington Ky 40505859.231.0054Fax: 859.299.0261www.cvcky.org



Community Ventures Corp. - Campbellsville107 W. BroadwayCampbellsville Ky 42718270.849.2323Fax: 270.465.0607www.cvcky.org

Community Ventures Corp. - Henderson145 n. Main St, Fifth FlHenderson Ky 42420270.826.7505Fax: 270.827.2969www.cvcky.org

Community Ventures Corp. - Lexington1450 n. BroadwayLexington Ky 40505859.231.0054Fax: 859.299.0261www.cvcky.org

Community Ventures Corp. - Louisville811 S 2nd StLouisville Ky 40203502.566.6076Fax: 502.566.6078www.cvcky.org

Community Ventures Corp. - Paris509 High StParis Ky 40361859.340.4028Fax: 859.340.4052www.cvcky.org

Kentucky Highlands Investment Corp.P.o. Box 1738London Ky 40743-1738606.864.5175Fax: 606.864.5194www.khic.org

Purchase ADD, Inc.1002 Medical DrMayfield Ky 42066270.247.7171www.purchaseadd.org Pre-Qualified Loan Programthe u.S. Small Business Administration has created the Pre-Qualification Loan Program to help small businesses that have traditionally been underserved by the lending community. upon approval, SBA will issue a guarantee commitment letter for up to $250,000. Based on the commitment letter, SBA lenders can provide expedited consideration.

U.S. Small Business Administration600 Dr. M. L. King Jr. PlLouisville Ky 40202502.582.5971www.business.usa.gov

US Dept of Housing and Urban Development

Community Development Block Grant Loans (Section 108 Program)Federal funds are allocated by the Department of Housing and urban Development (HuD) to fund economic development activities in Kentucky under the Community Development Block Grant program (CDBG). Communities typically make loans available from those funds to draw needed economic expansion and revitalization projects.

these cities and counties are eligible: Ashland, Covington, Henderson, Hopkinsville, owensboro, Lexington/Fayette County, and Louisville/Jefferson County.

CDBG funds are granted to these cities and counties. not all communities make business loans. Contact your local Department of Community Development or Department of Housing official for more information.

US Dept of Housing and Urban DevelopmentCPD Field office601 W BroadwayLouisville, Ky 40202(502) 618-8143Washington, D.C. (202)[email protected]

US Dept of Agriculture

Business and Industrial Guaranteed Loansthe u.S. Department of Agriculture (uSDA) provides loan guarantees through private lenders in rural areas of Kentucky. Guarantees can cover a maximum of 80 percent for loans under $5 million, 70 percent for loans from $5 to $10 million, and 60 percent for loans in excess of $10 million.

Loans must be made in an area with a population of less than 50,000. Priority is give to applications made in rural communities and towns of 25,000 or less.Funds may be used to purchase land, building, machinery, equipment, furniture and fixtures; to finance construction, expansion, repair, or modernization of buildings; to provide start-up and working capital; and to aid in agricultural production. Funds may also be used to refinance existing debt if it is necessary to save existing jobs or improve cash flow.

Business and Industrial Direct LoansDirect loans expand the available credit for businesses that do not qualify for private funding to create/retain jobs and

504 Lenders cont.



improve the economic climate in targeted rural communities. the loan may be used for business and industrial acquisitions, construction, expansion, repair and development costs. Certain conditions apply to the use of funds for purchase of equipment, machinery, supplies, start-up costs and working capital.

Rural Development State Officerural Business-Cooperative Service (rBS)771 Corporate Dr, Ste 200Lexington Ky 40503859.224.7300Fx: 859.224.7425www.rurdev.usda.gov/ky/

Guaranteed Farm Ownership and Operation LoansLoans administered by the Farm Service Agency help farmers obtain commercial credit to establish or maintain a farm or ranch. Guarantees are provided that cover up to 90% of the value of a new loan up to $762,000 in rural communities of 50,000 or less population. Loans may be used for purchase of land, capital improvements, livestock, equipment, quotas and bases; production, processing and marketing purposes; payment of loan closing costs, land and water development and conservation, farm and home needs.

Direct Farm Ownership and Operating LoansLoans are awarded to farmers who are uS citizens unable to obtain credit to traditional commercial sources that have a good credit history and a demonstrable ability to repay the loan. Maximum loan amounts for both ownership and operating loans are $200,000. interest rates are typically based on the government’s cost of borrowing for regular loans and 4% for down payment loans.

Loans may be used for acquiring or enlarging a farm, paying closing costs, purchasing livestock, equipment supplies, closing costs or conservation improvements.

US Dept of AgricultureFarm Service AgencyKentucky State office771 Corporate Dr, Ste 100Lexington Ky 40503859.224.7601Fx: 859.224.7691www.rurdev.usda.gov/ky/

Export-Import Bank of the United States

Working Capital Loan Guarantee Programthe export-import Bank of the united States (ex-im Bank) is a government agency which assists export financing of u.S. goods and services through loan, guarantee, and insurance programs. Working capital loans are guaranteed up to 90 percent of principal and interest. Working capital loans must be secured by inventory, accounts receivable, or other appropriate collateral.Proceeds may be used for pre-export activities such as the purchase of inventory, raw materials, the manufacture of a product, or marketing.

the export import Bank202.565.3946800.565.eXiMwww.exim.gov

Small Business Innovation Research Program

the Small Business innovation research Program (SBir) awards grants for research and development. the program is designed to promote technology-based firms by providing “idea money” to help develop new technologies. Projects funded by SBir are usually too early, too high-risk or too expensive for banks, venture capitalists, or internal funding.A company must meet research requirements identified above and be a for-profit American firm with less than 500 employees. Firms may receive award money in three phases. Phase 0 funding is to support preparation of Phase 1 proposals in amounts up to $4,000. Phase i is to evaluate the technical merit and feasibility of an idea. Awards are for periods of up to six months in amounts up to $100,000. Phase ii is to expand on the results and further pursue the development of Phase i. Awards are for periods of up to two years in amounts up to $750,000. only those companies awarded money in Phase i may compete for money in Phase ii.

U.S. SBA Office of Technology409 third St SWWashington DC 20416(202) 205-6450www.sba.gov/sbir/


s t a t e g o v e r n M e n t M o n e y s o u r c e s

State Government Money Sources

Kentucky Economic Development Cabinet

Kentucky Economic Development Finance Authority Direct Loan Programthe Kentucky economic Development Finance Authority (KeDFA) direct loan program offers loans to work in conjunction with private financing.

eligible projects are agribusiness, manufacturing, or service and technology industries. no retail projects are eligible. Projects must create at least one new full-time job within one year of the loan closing date.

KeDFA funds may only be used for fixed asset financing. KeDFA can fund up to 100% of the project costs, or the loan can be used in conjunction with other lenders. All loans will be secured with the highest lien position available. KeDFA may participate up to 25 percent of project fixed asset costs, but amount of participation is based upon the number of jobs created. Loan amounts range between $15,000 and $100,000. KeDFA will not lend more than the private lending institution toward the fixed assets.

Dept of Financial Incentivesold Capital Annex300 W BroadwayFrankfort Ky 40601502.782.1978

Industrial Revenue Bond Financing industrial revenue Bonds (irBs) are issued by Kentucky’s state and local governments to provide low-cost financing.

Bond funds can be used to finance the entire project including engineering, land, buildings, equipment, and issuance costs. the primary advantage of irB financing is that interest income from the bonds is exempt from federal income taxes, resulting in a lower rate of interest for the money used to finance the project. in addition, state statutes declare that a facility financed by irBs is public property for as long as the title is held by the public body that issues the bonds. As public property, it is exempt from all state and local property taxes, except for a nominal state leasehold tax of $.015 per $100 of leasehold value.

Department of Financial Incentivesold Capital Annex300 W BroadwayFrankfort Ky 40601502.782.1987Fx: 502.564.7697www.thinkkentucky.com/kyedc/kybizince.aspx

Kentucky Small Business Credit InitiativesKentucky’s Cabinet for economic Development offers three new credit enhancement programs thanks to an allocation of federal funding received by the united States Department of treasury.

Kentucky’s allocation of funds have allowed the Cabinet to increase the availability of credit to small businesses by reducing the risk participating lenders, credit unions and community development financial institutions assume.

eligible borrowers include corporations, partnerships, state-designated charitable, religious, and other nonprofits, government-owned corporations, consumer and marketing cooperatives, and faith-based organizations, provided the loan is for a qualified business purpose.

An eligible borrower must have 500 or fewer employees and be Kentucky residents. Loan proceeds can be used for eligible purposes such as, but not limited to, start-up costs, working capital, business acquisitions and expansions, franchise financing, equipment loans, inventory financing, owner occupied commercial real estate acquisitions, renovation and construction.

Kentucky Loan Participation Program (KYLPP)this program assists borrowers whose cash flow does not meet a lender’s coverage requirements by allowing the Cabinet to purchase (or participate in) a portion of the loan from the lender. Participating lenders have the option of offering a grace period for payment of interest and/or principal up to 24 months.



Kentucky Collateral Support Program (KYCSP)this program provides a pledged asset (cash) to participating lenders to enhance collateral coverage of the small business owner that is otherwise qualified, but unable to meet the lender’s security requirement.

Kentucky Capital Access Program (KYCAP)offers participating lenders loan portfolio insurance by providing a matching contribution to the lender’s loan loss reserve account when they extend credit to qualified, creditworthy small businesses. in the case of a loss, lenders may draw against the account to offset the loss.

to find a participating lender in your area, or obtain additional information about the programs, visit www.thinkKentucky.com/smallbizlending or contact Mark Johnson at 800-626-2930 or email [email protected]

Incentive Programs

Kentucky Rural Economic Development Act (KREDA)new and expanding manufacturing projects under KreDA may potentially receive state income tax credits and job assessment fees for up to 100% of their capital investment for up to 15 years on land, buildings, site development, building fixtures and equipment used in a project.

Kentucky Jobs Development Act (KJDA)KJDA projects may receive a 100% credit against the state income tax arising from a project and may collect a job assessment fee of up to 5% of the gross wages of each employee whose job is created by the project and who is subject to Kentucky income tax. Amounts can be up to 50% of project start-up cost and up to 50% of annual facility rental cost or rental value for up to 10 years. the local community must approve the project prior to the submission of an application.

Kentucky Industrial Development Act (KIDA)Similar to KreDA, this program is for new and expanding manufacturing projects. Projects approved under KiDA may receive state income tax credits for up to 100% of its capital investment for up to 10 years on land, buildings, site development, building fixtures and equipment used in a project. or, the company may collect a job assessment fee of 3% of the gross wages of each employee whose job is created by the approved project and who is subject to Kentucky income tax.

Kentucky Economic Opportunity Zone Program (KEOZ)Counties, urban county governments, or cities of the first class apply through KeDFA (see above) for certification of an opportunity Zone based on qualifying census tract information. new or expanding manufacturing or service/technology companies may be permitted the following inducements under the KeoZ program: An income tax credit of up to 100% of the Kentucky income tax liability on income generated by or arising out of the project; and a job development assessment fee of up to 5% of gross wages.

Kentucky Investment Fund Act (KIFA)KiFA provides tax credits to individuals and companies that invest in approved venture capital funds. investors in KiFA approved funds are entitled to a 40% credit against Kentucky individual or corporate income tax or Kentucky corporate license tax. KeDFA (see above) approves investment funds and fund managers.

Kentucky Cabinet for economic DevelopmentDepartment of Financial incentivesold Capital Annex300 W BroadwayFrankfort Ky 40601502.782.1987Fx: 502.564.7697www.thinkkentucky.com/kyedc/kybizince.aspx



Linked Deposit Loan Programthe State investment Commission invests funds from the state’s Abandoned Property Cash Account at a set rate with eligible lenders. in turn, the financial institutions agree to lend the proceeds of the funds to eligible small business borrowers at attractive rates.

Any Kentucky small or agricultural business is eligible for the loans with the following limitations:1) Must be headquartered and maintaining operations in Kentucky.2) $1 million or less per year in gross annual earnings3) Fewer than 50 full time employees.

4) no applicant can be an officer or director of eligible lending institutions.

the loans may be used for working capital, interest costs, capital expenses and debt refinancing. the maximum loan amount is $100,000 with repayment due in seven years. the interest rate is based on the prime rate and collateral requirements are negotiated by the borrower and the lender.

Linked Deposit Loan Programold Capital Annex300 W BroadwayFrankfort Ky 40601502.564.7140www.thinkkentucky.com/kyedc.linkdeposity.aspx

Office of the New Economy

Innovation and Commercialization Centersthese centers are public/private partnerships that will assist the state’s entrepreneurs and scientists commercialize technologies that demonstrate significant market potential. Kentucky’s iCCs are designed to serve two groups of clients: the entrepreneur who wants to create a technology-based company and the scientist who wants to commercialize a technology. iCCs will help scientists and entrepreneurs understand the start-up process and investment practices. the iCC’s enlist a network of investors to review and participate in funding entrepreneurs who follow the iCC business process.



Rural Innovation FundFor use in rural Kentucky, this fund is specifically for businesses with no more than 150 employees. it is divided into two phases. Phase i funds are a one time investment of up to $7,500 to provide capital for proof of concept and early stage prototype development. Phase ii funding is only allocated after successful Phase i work. it provides a maximum of $100,000 over a two year period, not to exceed $50,000 in any one year.

Research and Development Fundthis fund is reserved for Kentucky businesses with less than 150 employees who contract with a Kentucky university. the r&D fund is for investment in technology refinement, prototype and commercial product development. the fund amount is for a maximum of $200,000 not to exceed $100,000 in any one year.

Kentucky Commercialization Fundthis fund is allocated for investment in university based technology commercialization. up to $225,000 is granted over three years, not to exceed $75,000 over any one year period.

Kentucky ICC OfficeLaurie Daugherty200 W Vine StLexington Ky [email protected]

ICC Satellite Offices

Ashland ICCMick Fosson1400 Winchester Ave Ste 600 Ashland Ky 41101606.326.2239

Bowling Green ICCDoug rohrer2413 nashville rd, Ste B8Bowling Green Ky 42101270.901.3490

Covington ICCCasey Barach535 Madison Ave, Ste 400Covington Ky 41101859.292.7781

Elizabethtown ICCLisa Williamsrr thomas Bldg14 Public Sq, Ste 6elizabethtown Ky 42701270.765.1855

Lexington ICCWarren nash330 e Main St, Ste 210Lexington Ky 40507859.257.6871

London ICCBill Schutters 440 old Whitley rdLondon Ky 40744859.806.8258

Louisville ICCtendai Charasika614 W Main St, Ste 6000Louisville Ky 40202502.625.0140

Morehead ICCJohnathan Gay 150 university DrWest Liberty Ky 41472606.743.4005 x211

Murray ICCLoretta Daniel926 n 16th StMurray Ky 42071270.809.6071

Owensboro ICCMadison Silvert200 e 3rd St, Ste 301owensboro Ky 42303270.663.1050

Paducah ICCian Blacke401 Kentucky AvePaducah Ky 42003270.443.1746 x220

Richmond ICCKristel SmithBtC 041 - 521 Lancaster Averichmond Ky 40475859.622.8571


r e g i o n a L g o v e r n M e n t M o n e y s o u r c e s

Regional Government Money Sources

Area Development DistrictsLoans for local businesses and business start-ups may be available through many city and county governments and area development districts (multi-county government services planning agencies).

Loans are usually restricted to $500,000 or less, or to a specified amount per job created or saved. the balance of financing for a project must come from owner equity or from other private or public lenders. terms and interest rates are set by local government lending agencies.

Barren River Area Development District177 Graham AvePo Box 90005Bowling Green Ky 42101270.781.2381FX: 270.842.0768www.bradd.org

Big Sandy Area Development District110 resource CtPrestonsburg Ky 41653606.886.2374Fx: 606.886.3382 ext 208www.bigsandy.org

Bluegrass Area Development District699 Perimeter DrLexington Ky 40517859.269.0821Fx: 859.269.7917www.bgadd.org

Buffalo Trace Area Development District201 Government StPo Box 460Maysville Ky 41056606.564.6894Fx: 606.564.0955www.btadd.com

Cumberland Valley Area Development District342 old Whitley rdPo Box 1740London Ky 40743606.864.7391800.795.7654Fx: (606) 878-7361www.cvadd.org

FIVCO Area Development District32 FiVCo CtGrayson Ky 41143606.929.1366Fx: 606.929.1390www.fivco.org

Gateway Area Development District110 Lake Park DrMorehead Ky 40351606.780.0090Fx: 606.780.0111www.gwadd.org

Green River Area Development District300 GrADD Wayowensboro Ky 42301270.926.4433Fx: 270.684.0714www.gradd.com

Kentucky River Area Development District917 Perry Park BlvdHazard Ky 41701606.436.3158Fx: 606.436.2144www.kradd.org

KIPDA11520 Commonwealth DrLouisville Ky 40299502.266.6084Fx: 502.266.5047www.kipda.org

Lake Cumberland Area Development District2384 Lakeway DrPo Box 1570russell Springs Ky 42642270.866.4200800.264.7093www.lcadd.orgLincoln trail Area Development District613 College Street rdPo Box 604elizabethtown Ky 42702270.769.2393800.247.2510Fx: 270.769.2993www.ltadd.org



Mayor’s Office of Economic Development200 e Main StLexington Ky 40507859.258.3100http://www.lexingtonky.gov/index.

Northern Kentucky Area Development District22 Spiral DrFlorence Ky 41042859.283.1885www.nkadd.org

Pennyrile Area Development District300 Hammond DrHopkinsville Ky 42240270.886.9484Fx: 270.886.3211www.peadd.org

Purchase Area Development District1002 Medical DrMayfield Ky 42066270.247.7171Fx: 270.251.6110www.purchaseadd.org

TVA Loans: Southwestern Kentuckythis multimillion-dollar revolving loan fund is designed to stimulate capital investment and job creation in the tVA region. Applications are evaluated based on a project’s financial viability, its local economic impact, the amount of funds leveraged, and the expected increase in power sales. extra emphasis is given to industrial expansion and relocation projects in economically underdeveloped areas of the valley. eligible loans must be co-sponsored by local government, a power distributor, or an economic development agency.

new or expanding manufacturers in the tVA’s 21-county service area located in south central and western Kentucky may be eligible for loans based on job creation and electrical load.

these loans are available for companies to finance fixed assets such as land, buildings, or equipment. the funds cannot be used for working capital. tVA participation in these loans is normally limited to $5,000 per job created, with loans ranging from $50,000 to hundreds of thousands of dollars where project size warrants. Borrowers must contribute a minimum of ten to fifteen percent of project equity. terms are usually five to seven years on equipment and ten years on property and plant. rates are subject to negotiation, but are generally set below prime rate.

Tennessee Valley Authority4537 Ft Campbell Blvd, Ste 103Hopkinsville Ky 42240270.887.8466and6045 russellville rdBowling Green Ky 42101www.tva.govhttp://www.tvaed.com/loans.htm

TVA Supported IncubatorsBusiness incubators are facilities designed to help new businesses get started by providing affordable rental space, onsite support services, and technical assistance (including financial and legal advice) in a unique environment that fosters growth. Firms housed in tVA-assisted business incubators can apply for money from tVA’s Business incubator Loan Fund, a revolving fund capitalized at $500,000 that is

designed to help young businesses meet their short-term needs for cash flow and operating capital. the largest loan amount available is $25,000, for a maximum term of one year. A loan request must be supported by purchase orders, invoices, or accounts receivable.

Regional Business Innovation Center926 n 16th StMurray Ky 42701270.809.6071http://www.tvaed.com/busincub.htm

Rural Electrification (REA) Loansrural electrification (reA) loans are interest-free loans available to qualifying businesses that create jobs in rural areas served by four Kentucky rural electric cooperatives and two rural telephone cooperatives. Qualifying businesses can borrow from $10,000 to $400,000 with a maturity of up to ten years.

Projects eligible for funding include new and expanding manufacturing, industrial buildings, agricultural processing, telemarketing, recycling operations, water and sewer extensions, and feasibility studies.

Applications for reA loans are judged by several factors including economic need in the project area, jobs created, and probability of long-term success. Processing of applications can take from four to six months.


these cooperatives participate in the reA business loan program in their service area:

Meade County RECCtim GossettHwy 79 at Hwy 1051P.o. Box 489Brandenburg Ky 40108(270) 422-2162

Warren RECCHeather Foley951 Fairview AvenueP.o. Box 1118Bowling Green, Ky 42102(270) 842-6541


P r i v a t e c a P i t a L

Mountain Association for Community Economic Development this is a private community development corporation that provides loans, financial planning, and technical assistance to qualifying new and expanding companies in the 49 Appalachian counties of eastern Kentucky. MACeD offers below-market interest rates and innovative financing options by packaging loans with both public and private resources.

Local business start-ups and expansions that create jobs and support local

community development and economic expansion are eligible.

Loans range from $50,000 to $500,000 and may be used to finance working capital or purchase fixed assets. Maturities up to ten years are available.

MACED433 Chestnut StreetBerea, Ky 40403(859) 986-2373Fax (859) 986-1299http://www.maced.org

Private CapitalPrivate investment firms are formed by high net worth individuals and vary widely in their operating style and investment preferences. Some are founded and run by a single individual who makes all the decisions. others are comprised of several high net worth individuals who empower an “investment committee.” the level of operating control expected by these investors will vary from firm to firm- some seek a passive, minority investment position while others want a board seat and/or operating control.

Alliance GroupMike Pitino502.253.6881Louisville Ky 40223www.alliancegrouponline.com

Blue Equity, LLCJonathan S. Blue502.589.8181Preston Pointe333 e Main St, Ste 200Louisville Ky 40202www.blueequity.com

Evermore Investments, LLCDean Holland502.292.239311405 Park rd, Ste 180Anchorage Ky 40223www.evermoreinvestments.com

Futurity Investment Grouprod Mcnerney502.583.3038900 Baxter AveLouisville Ky 40204

Pattco Venturestom Dieruf502.245.662310000 Shelbyville rdLouisville Ky 40223

The Yearling FundDale Boden502.587.1860Preston Pointe333 e Main St, Ste 310Louisville Ky 40202

Anchorage AngelsGreg Chapman, Manager808 towner PlAnchorage Ky [email protected]@gmail.com


v e n t u r e c a P i t a L

Venture CapitalVenture capital is funds from investors who take an ownership role in the company. these funds generally go to high growth companies that offer above average rates of return-on-investment, often as high as 30%. Business owners seeking these funds must be willing to give up some control of their company and plan to extract the funds, including returns, from the business in 5 to 7 years.

Chrysalis Ventures LLCDavid A Jones, Jr101 South Fifth Street, Suite 1650Louisville, Ky 40202502.583.7644www.chrysalisventures.com

Draper Triangle VenturesMark richey513.263.273230 W third St, Sixth FloorCincinnati oH 45202www.drapertriangle.com

Heron CapitalShannon rothschild317.686.19501 indiana Sq, Ste 2250indianapolis in 46204www.heroncap.com

Allos VenturesJohn Mcilwraith513.723.2300250 e Fifth StCincinnati oH 45202www.allosventures.com

River City Capital Fundsted robinson513.621.9700221 e Fourth St, Ste 2400Cincinnati oH 45202

Triathlon Medical VenturesGeorge emont 502.410.1652222 S First St, Ste 200Louisville Ky [email protected]

UPS Strategic Enterprise Fund55 Glenlake Parkway neBldg 1, 4th FloorAtlanta GA [email protected]

Mountain Ventures Inc.Kentucky Highland investment Corporation362 old Whitley rdP.o. Box 1738London, Ky 40743606.864.5175www.khic.org

Venture Connectors550 S 4th StLouisville Ky 40202502.719.0012www.ventureconnectors.orgcontact@ventureconnectors.org

Village Ventures, Incone Bank StWilliamstown MA 01267413.458-0038www.villageventures.com

Office for the New Economy702 Capitol Ave, #256Frankfort Ky 40601502.564.0531Fax: [email protected] www.one-ky.com/capital.html


s e e d F u n d s

Seed FundsSeed funds provide the funds necessary to start an enterprise and sustain it until it has enough funds to sustain itself or where it reaches a state where it has created something in value that is worthy of future rounds of funding. Seed money is usually used for such preliminary operation such as market research or product development. Seed Fund managers will often seek a board position.

Commonwealth Seed CapitalGene Fuqua502.564.1910300 W Broadway, old Capital AnnexFrankfort Ky [email protected]

Kentucky Seed Capital FundGeorge emont & Steve Gailer502.410.1652222 S First St, Ste 200Louisville Ky 40202www.kyseed.com

Cardinal Venture FundProf. Van Clouse502.852.4782university of Louisville College of BusinessLouisville Ky 40292business.louisville.edu/content/view/450/625/”

The Vogt Invention and Innovation AwardsLisa Bajorinas502.635.0133Louisville, Ky [email protected]

Venture Connectors550 S 4th StLouisville, Ky 40202502.719.0012www.ventureconnectors.orgcontact@ventureconnectors.org

Growing Small Businesses

502.625.0123


a n g e L i n v e s t o r s

Angel InvestorsAn Angel investor is an affluent individual or group of individuals who provide capital for business start-up in exchange for equity or convertible debt. Angels invest their own money and often become mentors and advisors to the companies in which they invest.

Enterprise Angelstendai [email protected] [email protected] W Main St Ste 6000Louisville Ky 40202www.angelsoft.net/angel-group/louisvilles-enterprise-angels

Innovation AngelsPaul MosesLarry MandPurdue research Park3000 technology Drnew Albany in [email protected]

Louisville Angel Investor Networktom McMahon502.561.1240207 W Market St, third FloorLouisville Ky 40202tom@GrowthServicesLLC.comwww.louisvilleangelnetwork.angelgroups.net

Bluegrass Angels & Bluegrass Angel Venture FundsDean Harvey859.257.1930330 e Main St, Ste 210Lexington Ky 40507www.bluegrassangels.com

Queen City AngelsJim Cunningham513.477.08094555 Lake Forest Dr, Ste 650Cincinnati oH 45242www.qca.com

c r o w d F u n d i n g

CrowdfundingCrowdfunding is a financing method that involves funding a project with relatively modest contributions from a large group of individuals, rather than seeking substantial sums from a small number of investors. the funding campaign and transactions are typically conducted online through dedicated crowdfunding sites, often in conjunction with social networking sites. Depending on the project, campaign contributors may be essentially making donations, investing for a potential future return on investment (roi), or prepaying for a product or service.

Kickstarter.com Kickstarter is the 800 pound gorilla in crowdfunding, originally designed and built for creative arts, many technology entrepreneurs now use the site, some reporting to have raised millions of dollars.

Indiegogo.com indiegogo allows you to raise money for absolutely anything, using an optional “keep what you raise” model with higher fees or pay less to use an all-or-nothing funding approach.

Rockethub.comrockethub is a broad platform targeting “artists, scientists, entrepreneurs, and philanthropists” on their site, using a keep-what-you-raise model that rewards you for hitting your funding goal (or penalizes you for failing to hit it).


M e z z a n i n e F i n a n c i n g

Mezzanine FinancingMezzanine financing is also known as subordinated debt, which ranks below senior debt, but above equity in priority of payment. When a company determines that it’s not capable of financing its growth plans with senior debt, the first step is to partner with a financial institution to locate an investor willing to provide capital in the form of long-term subordinated debt, usually carrying a fixed interest rate. Generally, these loans do not involve ownership or management participation; however they do include success fees or warrants to purchase equity at a later date.

A clear advantage of mezzanine financing is the flexibility it affords both lenders and borrowers. the parties can devise a mezzanine package that contains just the right trade-off between equity dilutions on the one hand and interest charges on the other.Many commercial lenders and private investment firms offer Mezzanine financing. you may want to consider mezzanine

financing if your company has a record of strong cash flow and needs more funds than traditional senior debt can supply.

Charles & Associates320 Whetstone Alley #BCincinnati, oH 45202513-621-5600

502.625.0123


n o n - P r o F i t o r g a n i z a t i o n s

Non-profit Organizations

Kentucky Highlands Investment CorpKHiS is a venture capital development firm founded in 1968 to service Southeastern Kentucky. KHiC maintains a multi-million dollar capital pool and has numerous investments in its portfolio ranging from $100,000 to more than a million dollars.KHiC helps small businesses through venture capital debt and equity investments for projects such as start-ups, expansions, and relocations of manufacturing, distribution, and services firms.

Appalachian Capital Corporation is a fund which provides financing to viable businesses located or locating in Southeast Kentucky. the maximum loan amount is $250,000. Proceeds may be used to finance the purchase or construction of fixed assets, or for working capital.

Micro enterprise Loan Fund is designed to encourage the development of small businesses by extending credit and providing technical assistance. Funds may be used for the purchase of equipment or for working capital for the business and loan terms cannot exceed six years. A 5% minimum equity investment and personal guarantee are required.

Kentucky Highland Investment Corporation362 old Whitley rdPo Box 1738London Ky 40743606.864.5175www.khic.org

Human/Economic Appalachian Development, Inc. Community Loan FundHeAD Community Loan Fund is a non-profit revolving loan fund which provides loans to individuals, cooperatives and organizations starting or expanding small businesses in Central Appalachia.

Loans are made to start-up or existing small businesses in Southeastern Kentucky that support the Appalachian culture.

Maximum loan amounts are $25,000 for new businesses and $50,000 for existing businesses. interest rates vary between 8 and 12 percent and maturities range from 1 to 5 years. Loans are repaid in monthly installments. A one percent loan fee is charged upon approval of the loan.

HEAD CorporationP.o. Box 504Berea Ky 40403859.986.8423www.headcorp.org

Metro Louisville

Metropolitan Business Development Corporation (METCO)/Louisville Dept of Economic Development Growth and Innovation

MetCo is a nonprofit corporation operating on behalf of the city of Louisville/Jefferson County that provides loans to small businesses located within the city. Priority is given to projects that provide maximum job creation or that hire individuals from low to moderate income families.

the Business Loan Program provides long-term loans up to $100,000 at near-market rates to be leveraged with private sector financing. Program loans make up the difference between available private sector financing and the funding necessary for a project’s success.

neighborhood Commercial Development Loan Program makes available up to $10,000 per storefront at 5% to businesses in target areas for development and revitalization projects.Minority Loan Program makes available up to $100,000 at below market rate financing to help leverage capital financing from private sources for women and ethnic/minority businesses.

METCO444 S 4th St Ste 600Louisville Ky 40202502.574.4140www.louisvilleky.gov/economicdevelopment/


n o n - P r o F i t o r g a n i z a t i o n s

Community Services & Revitalization Microenterprise Loan ProgramMany low to moderate income entrepreneurs starting a new business have difficulty securing traditional business financing. to address these challenges, CSr provides loans to help create or expand small businesses in Louisville and Jefferson County

Loans awarded if the business meets certain thresholds. CSr staff is required to monitor the businesses monthly in addition to certain other requirements.

Applicants must meet the following criteria:• Must employ five or less employees• Business owner(s) household income must fall at or below 80% of AMi• Business must be located within Louisville Metro and the owner(s) must reside in Louisville• Must be willing to allow CSR staff to monitor the business on a monthly basis until the loan is paid in full• Loans must be used for eligible activities

Community Services & Revitalization810 Barrett AvenueLouisville, Ky 40204502-574-5866 or 502-574-5186www.louisvilleky.gov/CAP

Southern Kentucky Economic Development Corporation (SKEDC)SKeDC provides financing for fixed assets in qualified projects with a secured loan of up to $10,000 per new job created, not to exceed $250,000 or 45% of the project cost, whichever is less. these funds may be used to assist in the purchase of land, the purchase of existing buildings, new construction, or the purchase of equipment. the interest rate is fixed for the life of the loan, and is determined by the length of term.

Economic Development Loan Fundthe purpose of the economic Development Loan Fund is to enhance job creation by providing below-market-rate, fixed-asset financing to established manufacturing industries which need assistance in purchasing equipment or purchasing and constructing new facilities. the maximum loan is 45% of the project, not to exceed $150,000. Projects must create one new job

per $10,000 invested, or have a significant impact on the economic growth of a community.

Small Business Loan FundLoan proceeds may be used by small owners to finance the purchase and/or construction of fixed assets, which includes land, buildings, and equipment. the maximum loan amount is the lesser of 45 % of the total project cost or up to $250,000. the minimum loan size is $25,000. Projects must create one new job per $10,000 invested or have a significant impact on the economic growth of a community.

The Southern Kentucky Economic Development Corp.2292 South Highway 27, Suite 340Somerset, Ky 42501(606) 677-6100Fax (606) 677-6010www.southeastkentucky.com

Louisville Small Business Development Center

502-625-0123

[email protected]

KSBDC.org/Louisville

ksbdc louisville funding sources for business

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