Small Business Loans In California
When it comes to entrepreneurship, California leads the way. 13% of all small businesses in America can be found here, with new ones launching every day. However, getting started isn’t easy – this state has some of the highest living and business costs in the USA. This fact makes it tough for aspiring business owners to make it on their own.
Fortunately, there are numerous business lenders in California. Thanks to these venture capitalists, there is no shortage of capital floating around. Everywhere you look, you’ll find firms that offer small business loans California.
In this guide, we list the best business lenders in California. These operators are authorized to offer loans to Californians and deal only with small businesses. They are fast, have transparent payment terms, and possess a higher acceptance rate than the banks. Whether you’re looking for small business loans in San Francisco or Los Angeles, they have what you need.
Best 3 Lenders in California
California Small Business At A Glance
From a macro perspective, the scale of small business in California is enormous. In 2019, the state posted GDP figures of over $3.1 trillion, or roughly 1/7 of America’s economic output. Put another way, California’s numbers surpass the GDP figures of developed nations like France and the UK.
In California, top industries include technology, financial services, tourism, energy, and agriculture. San Francisco is an anchor for the finance industry, with many regional bank HQs. The city is home to iconic attractions like the Golden Gate Bridge and Alcatraz, which draws scores of tourists. And of course, the Bay Area is home to Silicon Valley, the heart of America’s tech industry.
Down the coast, Los Angeles is most famous for its entertainment industry. As a result, it also attracts its fair share of tourism. In addition to these two mainstays, LA also is home to many aerospace and energy firms. Last but not least, San Diego has healthy tourism and biotech industries, and the Central Valley produces 8% of America’s agricultural output.
Small businesses are crucial to California’s prosperity. In this state, net job growth is most robust among firms with 20 employees or less. Firms with 20 employees or less comprise 88% of all businesses in the state. Businesses with 100 employees or less make up 97% of companies. To thrive, they need easy access to small business grants California. Unsurprisingly, business loan broker California has no shortage of customers.
Why Do Entrepreneurs Need Small Business Loans In California?
SMEs dominate the California business landscape. However, the Golden State isn’t a comfortable place to do business. For starters, commercial rents are incredibly high – Sand Hill Road in Menlo Park – at $119.38/sq. ft – has the most expensive rates in America. Things aren’t much better in downtown San Francisco, where prices can be as high as $75/sq. ft. For this reason alone, small business funding California has thrived. Otherwise, startups wouldn’t have a prayer of getting off the ground.
With sky-high overhead, all it takes is an economic downturn to plunge a firm into financial distress. All it takes is one missed payment for a firm to end up with a bad credit score. With a black mark on their record, getting small business loans in California for bad credit can be frustrating.
Successful small businesses may also need small business loans in California. Sudden spikes in demand can empty shelves. When this happens, smaller companies may not have the cash-on-hand to fund a new production run on such short notice. Small businesses make liberal use of business financing California to avoid under-capacity problems.
In all instances, California small businesses find online loan companies in California to be fast, reliable sources of capital. Rather than wait weeks, California entrepreneurs can get their hands on small business funding California in less than 24 hours.
Grants & SBA Lenders Available To California Small Businesses
California SMEs are integral to the success of the state’s economy. As such, they have access to numerous grants for small business owners in California. These government programs provide qualified applicants with the seed funding or tax credits needed to get off the ground. These programs include, but are not limited to, the following:
- The Small Business Technical Assistance Expansion Program is providing $17 million through 2022-2023 to fund low-cost training. It also offers one-on-one consulting, with emphasis on persons of color, women, veterans, rural-based, and/or low-income entrepreneurs.
- The Capital Infusion Program is providing $3 million in funding through 2022-2023. This program offers one-on-one consulting to assist SMEs in the task of accessing venture capital. This assistance can be useful for SMEs seeking small business loans in California for bad credit.
- The California Competes Tax Credit provides over $180 million in tax credits to businesses willing to relocate to California. Funds are also available to SMEs looking to expand in California. To qualify, the California government evaluates firms on 12 different metrics, such as projected job creation numbers, investment amount, and strategic importance. Together with business financing in California, this program can supercharge growth.
- The Advanced Transportation and Manufacturing Sales and Use Tax Exemption is available to businesses that manufacture advanced transport or alternative energy products. Successful applicants are exempted from a portion of sales and use taxes on the sale of their products.
- The Research & Development Tax Credit exempts a portion of the expenses incurred when conducting research in California. Wages paid to researchers and the costs of needed supplies are an example of these expenses. After a base amount, 15% of qualified expenses and 24% of research payments are tax-exempt.
- The Employment Training Panel offers grant funding to businesses that wish to upgrade the skills of their workers. Completion of an in-person/phone orientation and a preliminary application is needed to qualify for this program.
- The Economic Development Rate Program offers discounts to businesses that use considerable amounts of energy in their daily operations. Depending on their needs, companies can qualify for a standard deduction of 12%, or an enhanced discount of 30%.
Firms that opt for a loan instead of a grant should seek out small business loans in California through an SBA lender. SBA loans are guaranteed by the SBA, or the Small Business Administration. These financial products are backed by the federal government – because of this, they come with flexible terms. This fact makes it easier for business lenders in California to offer them.
Notable business lenders in California that issue SBA loans include institutions like:
- S. Bank
- Wells Fargo
- JP Morgan Chase
- CDC Small Business Finance Corporation
- Newtek Small Business Finance
California is, and will continue to be, an economic juggernaut. While it faces concerns like affordability and energy/water availability, it still has the 5th largest economy in the world. Its 3.3 million small businesses are its foundation – to stay healthy, these enterprises need access to small business loans in California. If your company needs cash, our list of reputable lenders will get the capital you need, fast.