Just because somebody has been convicted of a felony and served time in a prison system, that doesn’t mean once they are released they can’t start their own business. However, finding small business loans for felons can sometimes seem to be a daunting task.
The federal government, through the Small Business Administration (SBA) stipulates that felons are treated no differently than any other citizen when it comes to government grants or small business loans, however depending on where a person applies for a particular small business loan, that could not be completely forthcoming.
No specific grants set up.
The federal government has not established any specific federal grants that are for the ex-felon population attempting to start his or her own business once they are released from prison. That doesn’t mean an ex-felon can’t receive grants or other financial assistance to start their own small business.
Answering a few questions first.
If you’re looking for grants for convicted felons because you’re ready to start your own small business, you’ll need to answer a few questions first. The most important is how much money you’re going to require in order to get your small business up and running.
Trying to figure out exactly how much money you’re going to require for this small business is a matter of sitting down and writing out all of the system specifics. This could include transportation, equipment, computers, software programs, a website, or anything else that is directly pertinent to your small businesses success.
When applying for a loan or grant, you will also need to provide tax returns. If you have been building this business over time, you should be able to show some level of income from it that will encourage a particular financial company, organization, or the federal government that your business endeavor is a worthy investment on their part.
You’ll also need to explain your business idea, or model, as clearly and succinctly as possible. A high quality business plan is one of the most important tools you will have when applying for grants for ex-cons. A business plan is essentially a roadmap of what your business is, the target market, any financial specifications you have already established, where the money would be used for, and short and long-term financial projections of the business, including anticipated growth, hiring, and more.
Different types of small business loans for convicted felons you might want to consider.
If you are still in prison or somebody you care about is serving time, look into the Prison Entrepreneurship Program. This was initially founded in Houston, Texas in 2004 and has expanded to other states. It provides assistance in helping felons build an entrepreneurial endeavor. It doesn’t provide any financial assistance, but teaches them how to work with Angel Investors and other potential investors once they are actually developing their business idea. This type of program also connects felons with MBAs, politicians, and executives who may be able to provide assistance if their small business idea appeals to them.
Angel investors are independent individuals who are constantly seeking small businesses and companies that have a strong future. Each angel investor is going to view a business owner differently, and while ex-cons will have a distinct disadvantage because character is an essential component of a business owner for these investors, a great idea, strong ambition, creativity, determination, and rehabilitation can all attract potential angel investors in the future.
Government grants, as noted, are not set aside specifically for any ex cons, but there is no limitation on who can apply for various government grants. That means even somebody with a felony conviction who served a significant amount of time in a prison system can still apply for government grants.
In order to maximize potential success when applying for any particular government grant, the ex-felon needs to show a strong entrepreneurial skill, a solid business plan, focus on turning their life around, potential success for their business endeavor, and more.
Here are a number of government grants that may be able to provide some type of loans for felons. A grant, though, it’s not a loan but financial assistance from the government to help get a small business off the ground.
Starting a small business can be an exciting endeavor for anyone, including somebody convicted of a felony. If you’re looking for small business loans for felons, don’t try to find something that is separate for ex-convicts.
You can certainly apply for small business loan from any financial institution or one of these particular grant programs. The best way to focus on the right grants for convicted felons is to narrow down your search and be specific as possible. Present yourself in the best manner possible and show the board that you are truly a different person and that this particular business idea is worth the investment.