Small Business Loans & SBA Loans in Kentucky
Kentucky, the Bluegrass State famous for its thoroughbred horse racing, also has a broad economy driven by hundreds of small businesses. Supporting the startups and growth of these small businesses are numerous community banks, nonprofit financial organizations, and credit unions that are providing the loans these businesses need.
Types of Kentucky Small Business Loans
The established group of lenders in Kentucky know how to put together short-term and long-term financing options for small businesses in the Bluegrass State, especially those engaged in manufacturing, automotive-related Industries, aerospace, and agriculture.
SBA loans
SBA loans are business loans that are partially backed by the Small Business Administration (SBA), a federal agency. These loans are serviced by private lenders, but are popular because they generally have good interest rates.
Line of credit
Use a line of credit as a flexible form of financing. Unlike with a loan, this option does not involve a big disbursement upfront that you must repay, providing a flexibility that better fits many entrepreneurs’ needs.
Term loan
Term loans are common small business loans in which you would apply for a large disbursement of capital and then repays it over several years, along with fixed or variable interest.
Equipment finance
With equipment financing, you receive a piece of equipment and then pay off the cost of the equipment in installments. This way, your business can make money off the equipment immediately, even if you don’t have the funds to buy it at the sticker price.
Accounts receivable financing
Accounts receivable financing is an alternative form of business financing in which your unpaid invoices serve as collateral for a lump disbursement of funds.
Kentucky Small Business Loan Options
Businesses that need funds to expand will find plenty of commercial banks, credit union, and nonprofit organizations in Kentucky that are willing to make loans to small businesses.
Kentucky Economic Development Finance Authority offers financing to purchase or update equipment for small businesses engaged in manufacturing, agribusiness, or services and technology
Metropolitan Business Development Corporation provides loans to businesses located in Jefferson County for expansion, additions to working capital, equipment purchases, and commercial property improvements.
LiftFund uses funds donated by interested individuals and businesses to finance small business owners who want to expand and create new jobs that improve the economies of their communities.
Capital Access Corporation is a leading provider in the state of Kentucky for SBA 504 loans that can be used to purchase commercial properties or equipment.
Community Trust Bank offers multiple small business loan products, including SBA 7(a) and SBA 504 loans.
Republic Bank & Trust Company offers many different loan products to small business owners in Kentucky, including lines of credit and SBA loans.
Stock Yards Bank & Trust Company provides a number of services to its customers, including several business loan options. Small business owners can apply for various types of business financing options, including SBA loans.
Commonwealth Credit Union offers loan products like commercial equipment loans, commercial lines of credit, and commercial real estate loans to businesses in Kentucky.
Huntington National Bank is the number one SBA lender in northern Kentucky based on the amount of SBA 7(a) loans it has offered to businesses in the area. It also offers other loan products like term loans and business lines of credit.
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Recommended Next Reads
Read experiences from Kentucky business owners.
Four Seasons Catering
I recently sat down with Chef Mike Gayon of Four Seasons Catering in Covington, Kentucky to discuss how he started his catering business and how Lendio helped him get the financing he needed to fund his new expansion. Chef Mike has built a high end catering business with moderate prices in the Cincinnati Market.
One of my favorite quotes from the interview is “Julie was absolutely phenomenal. She bent over backwards to make sure that everything got taken care of.”
You can watch my Google+ Hangout interview with Coach Greg above and read the transcript below.
For more information about Four Seasons Catering, visit https://www.4seasons4you.com/
TRANSCRIPT
BURKE ALDER: Welcome to the American LaunchPad powered by Lendio. Today, we have our guest Mike Gayon from Covington, Kentucky with his business Four Seasons Catering. Thanks for joining us Mike. Glad to have you here with us.
MIKE GAYON: And pleasure to meet you here today.
BURKE ALDER: So tell everyone a little bit about your business, how you got Four Seasons Catering started, we’ll start there.
MIKE GAYON: Well, we started Four Seasons about 2 1/2 years ago. And we started in a small shared kitchen over here in Florence, Kentucky. Our idea was to bring a high end catering business that was moderately priced but had a little flash to it to the Covington, Kentucky and Cincinnati market; and we’ve been doing that. We’ve been having a good time with it. We’ve grown. We’re now in our own space. We actually have a small breakfast-lunch cafe in downtown Covington; and we’ve got our big large kitchen in the back. And we’re just pumping out more and more great food and we’ve got neighborhood accessibility here now so we have people that walk in the door in the morning and get their cinnamon rolls and get their breakfast sandwiches and all that stuff. It’s kind of nice than doing the kitchen that we were doing before because we really didn’t have anybody besides other big businesses in there and we didn’t have a license that allowed us for people that walk in the door so it’s a nice change.
BURKE ALDER: Yeah, that’s great. To see the progression of great food, great location; from catering to now having people to stop by; and if you’ll save me a cinnamon roll next time, for tomorrow, that’ll be great.
MIKE GAYON: Probably could overnight one now to you if you’d like…
BURKE ALDER: That’s awesome. You guys are great. What kind of really drives you in your business?
MIKE GAYON: Well again, we came up here from Florida. We had some restaurants in Florida and we got out of the restaurants there and came up here because my wife’s mother who’s in Cincinnati got sick and I needed something to do. And I’ve been working like 90 to 100 hours a week down there running restaurants. And I decided although I loved doing it, I’m getting a little older, and I decided that I need to find something where we could actually still do what we love to do but not have to work quite work so many hours and not to have quite somebody, a burden on us. Like a dining room, servers and all that kind of stuff provided. So we ended up doing the catering and the thing is it has been really successful. We’ve had great support from the city of Covington and Cincinnati and we’re members of all the organizations down here. Some of the businesses that helped us out like K&P Law that regularly ordered from us, and Duke Energy, and Procter & Gamble who were big folks here. They’ve just been great about ordering from us because we’re smaller business and they’re giving us the opportunity. And given the opportunity, we’ve excelled every time.
BURKE ALDER: That’s awesome. It’s great to really hear your success and to see all the people you’re actually influencing, all the businesses there and so that’s really awesome. Tell me a little about your – why you’re looking for financing?
MIKE GAYON: Well when we started this, we wanted to try and keep to where we didn’t borrow too much money from anyone, so we have grown the businesses. However, we just got to the point where Gateway Community and Technical College has picked us up to do their food service for them; and I didn’t have the cash to buy the equipment that I needed to be able to get the operations going there. And while they helped out and I do, you know, in saving us out, I still didn’t just- I was that little bit short that I needed to have to be able to making it function without getting into my operation capital because I don’t want to make – put myself in a situation to where I’m short of cash flow. That kills businesses.
BURKE ALDER: Yeah.
MIKE GAYON: And so we got a hold of you and you guys were phenomenal. You came with the money quick. You know, everything was exactly right.
BURKE ALDER: Yeah, that’s great. How was your experience with Lendio? You kind of offered some insights into that. How did Lendio helped you achieve that?
MIKE GAYON: Well again, the process with Lendio was actually quite simple. Went online and got the information. Faxed you guys a few little things like our business license and some of our information or banking and stuff like that and you guys had an offer for us within 24 hours. Julie who is our agent with you guys is absolutely phenomenal. She bent over backwards to make sure that everything got taken care of. I even think she stayed over late one day to make sure that we got everything done, what needed to be done.
BURKE ALDER: That’s great to hear. Yeah, Julie is awesome and she kind of represents just this hope that we have when we built this business which is helping you feel like you have someone who’s your partner on our end, so that’s great to hear. Any advice you would give to future restaurant owners out there? Any advice you can give them on starting a business?
MIKE GAYON: Well, the important thing is make sure that you do your research well. Knowing the nature you’re going to fit in. Knowing if there’s an agent for you there is huge. And number two, don’t go into a situation undercapitalized. If you have to borrow money, that’s okay. Make sure that you got a way to pay it back though and keep multiple lines of income working for you. We’ve got the catering business. We’ve got our old Deli Sandwich thing. We’ve now got the thing we’re doing over at Gateway Community College. So you know, we’ve got three pretty strong lines of income coming into the business and what that ensures is that if we have a slack for couple of months in one area, we have two to cover.
BURKE ALDER: Great, well I heard your friends out there call you Chef Mike. So Chef Mike, we really appreciate your time today on Lendio’s American Dream LaunchPad. So thank you for all that you’re doing for your community there in Covington, Kentucky. And thanks for never giving up and making things happen. We appreciate having you on the show today.
MIKE GAYON: Thank you for having me on and thank you folks in Lendio for making it possible for me grow.
BURKE ALDER: Thank you. Have a great day and we’ll talk soon.
If you liked this story you might also like:
3 Questions Business Owners Have About Small Business Loans
If you’re interested in finding a loan for your business, get started here with Lendio’s free loan matching service.
FAQs
Small business owners in the Bluegrass State have a wide choice of other resources to go to for networking and advice. For example, the SBA maintains an office in Louisville that small business owners can contact when applying for SBA loans or seeking business advice. SCORE is a nonprofit organization staffed by volunteer business executives who provide advice and mentoring to small business owners who want to expand their operations.
The Kentucky Small Business Development Center, which is located in Lexington, provides seminars, training, and connections for small business owners to find financing.
You can search for grants available for businesses in Kentucky at GrantWatch.com. For federal grants to Kentucky businesses, go to Grants.gov. Women entrepreneurs will want to check the requirements for grants at AmberGrants.
To improve your chances of qualifying for a loan, find out the exact requirements that your lender is asking for. Typically, a lender will require your application to clearly state the purpose of the loan, the collateral being offered, and how your business will be able to produce the cash flow needed to pay the loan back. You will also need to present the last several years of income statements and balance sheets.
The type of loan you request depends on how you intend to use the money. If you’re looking to purchase long-term fixed assets, you’ll want to apply for a term loan or a loan that allows you to purchase commercial property. Short-term financial needs to make up temporary deficits in cash flow will need a short-term loan or a revolving line of credit.
In addition to putting up initial equity capital, businesses will need to borrow money from time to time to fund increases in working capital and purchases of fixed assets. Taking on debt in a small business increases the profitability of the business and improves the return on owner’s equity.
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