Funding, finance, Resource

      Funding Your Food Startup: Three Financing Options to Explore

      Launching a food or beverage startup takes more than just a great recipe (although, that is definitely important!). It requires capital to buy ingredients, source packaging, and make the product -- all before you can start selling.  With so many funding options available, it can be challenging to determine the right one for your business. Here are three funding options we recommend:

      Microfinance Loans: Kiva

      Kiva is our favorite option and we recommend it to everyone that we work with. Kiva is a nonprofit crowdfunding platform that offers non-recourse, 0% interest rate loans, or, in other words, the friendliest loan terms you will ever see. (Bonus: They also do not require credit checks)

      Here's how it works. You will submit an application to Kiva for up to $10,000. If approved, the loan is then posted to Kiva's website where lenders can contribute to your campaign. You receive the funds, after the fundraising goal is reached, and then pay it back over time.

      Local CDFI Loans & Grants

      CDFIs, community development financial institutes, provide financing to underserved communities and small businesses, including food and beverage startups. They are mission-driven organizations and offer financial support via loans, grants, and coaching. They almost always have better terms than a traditional bank.

      Some CDFIs to check out in the Washington, DC area include: Capital Impact Partners and LEDC (don't let the name slow you down. They work with a ton of small businesses, not just latino-owned companies).

      Grants

      Yes. It's true what you've heard. Grants take work to administer but they are also a fantastic source of funding for small and local businesses. There are also professional grant writers who can help guide you through the process.

      If you're located in the DC-area, we recommend signing up for notifications about upcoming grants through:

      Whether you choose a 0% interest loan through Kiva, financing from a mission-driven CDFI, or a grant to support your growth, the key is to explore what works best for your business needs. There is no one right answer for every business. But every business will need outside funding at some point. 

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