Getting financing has always been a challenge for start-ups so we asked Geoff Streit, Vice President of Commercial Lending at 4Front Credit Union for his insight on the subject:
“Historically it has been challenging for start-up companies and early-stage companies to rely on financial institutions for capital. With some recent changes to SBA guidelines, that may become even more challenging. Prior to COVID, the SBA would provide loan guarantees to financial institutions up to 75% (up to 85% for smaller loans). The idea was that this loan guarantee by the Small Business Administration would be enough to entice a lender to make a loan that it would otherwise find too risky. New changes provide 90% loan guarantees to lenders through September of 2021. For some lenders, this will be enough to take a chance on businesses it would historically have otherwise not been able to work with. When looking at sources of capital, including traditional sources of financing makes sense in this Post-COVID world.”
4Front Credit Union is a member-owned financial cooperative serving more than 88,000 members across the state of Michigan. They grew from the combined resources of two institutions steeped in member advocacy and locally-focused service.
This is a guest article by Geoff Streit, VP of Commercial Lending at 4Front Credit Union.