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Blog: Blog2
  • Writer's pictureDebbie Goldfarb

It's the end of free money, now what? Financing strategies to get capital for your small business.

Money doesn't grow on trees. Trust me as a kid I checked each tree in our backyard. So, growing up, me and my sister got a tiny allowance to get what we wanted –which, in my case, was always a new comic book. Later, from my parent's stash of toothpicks--I would create cinnamon and clove-flavored toothpicks and sell them to my school classmates for a profit. This made me enough cash to buy the shirts with the comic book characters on them. I guess that’s how I learned the value of money early on… that it’s never free.

But COVID changed that notion albeit temporarily. In March 2020, the CARES Act provided financial assistance to Americans suffering the economic effects caused by the pandemic. This included forgivable loans to small businesses for job retention and other specified expenses through the Payment Protection Program (PPP). In other words, Free Money or Pass Go and Collect $200 in Monopoly.

Since the beginning of the pandemic along with the EIDL program--the government has disbursed a whopping $1.27 trillion in COVID-related relief to small businesses. Sure, sounds like a lot of small business money to me!

Despite the extended unemployment monetary support provided and influx of money from the PPP & EIDL funds---as a small business advisor--I constantly hear comments like:

-I’m running or have run out of money provided by the government!

-What do you mean there’s no more “free grant money?"

-How come I didn't receive more?

-The deadline passed for a line increase to my EIDL--how come you can't fix it...

I would be the first one to say that the COVID relief could have done more—but in truth- could it? It was only intended to help small businesses get over COVID-related injury to business sales & earnings. It was never intended to replace post-COVID business revenue.

And, while many small businesses have been challenged with landlords asking for back rent and increased rents there is another side of this story...Let’s look at some of dynamics that happened:

On the positive side: Over $660B was provided in economic relief, 51 million jobs were saved and 80% of small business payrolls were covered.

On the negative side: A small group of business owners used funds for non-business activities (buying/investing in crypto and/or stock market), took extended vacations, stayed/collected unemployment much longer than necessary & failed to return to the workforce.

Ah well—this is water under the bridge, or is it?

Due to a convergence of world events, we have the highest inflation levels since 1981. Supply shortages are still present, gas prices are still escalating & political revelations are more stunning than ever. Only this time there is NO more free or subsidized government money.

So, what does that mean for you as a small business owner?

Today, as before COVID access to funding remain the same…These include:

  • Bootstrapping—getting help from family and friends and/or use personal finances (savings accounts, retirement funds, cheap living) to fund the business. (Apple, Clorox Co., Coca Cola, Dell, Microsoft all began as bootstrapped ventures)

  • Crowdfunding -raising money from crowd to fund a business (Kickstarter, Indiegogo)

  • Venture Capital & Angel Investors-money provided by investors or angels in exchange for ownership & growth potential as seed money or ongoing support through difficult times. (Shark Tank)

  • Business Incubators & Accelerators—"for-profit” and “non-profit” endeavors specifically created to help launch, coach, and fund a variety of entrepreneurial start-ups.

  • Equity Financing – start-up funds provided in exchange for equity in the business endeavor.

  • Debt financing—start-up funds provided from outside source (Bank, Peer-to-Peer Lending, Business & Personal Credit Cards, Lines of Credit, Term Loans) in exchange for return of principal and an agreed upon percentage of interest. (Hard to believe but, in the 1990’s Sergey Brin and Larry Page, founders of Google used credit cards to launch this incredible juggernaut)

  • Small Business Administration (SBA) Loans -wide variety of start-up/ongoing funds from traditional and non-traditional banks

  • Microfinancing—available and accessible to credit challenged and financially disadvantaged small businesses/entrepreneurs with no access to capital.

  • SBIR and STTR Grants—specialty funds provided by large government agencies (NIH, HHS, EPA) as early-stage capital for small businesses/small business owners focused on advancements in health, science, and technology.

  • Economic Development Organizations & Corporations (EDC) - non-profit corporations designed to foster economic development by supporting/funding small businesses with loans, grants, and tax incentives.


If businesses like Walmart launched with a $20,000 VA Loan and/or Starbucks from a $3,000 Bootstrapped loan from friends & family---you can do it as well!

And, although the “free” money was nice to have… was it really free? Knowing the different types of funding options will help put you in a better position to decide which strategy to use when you need access to business capital.

For more business tips, check out my other articles. And email me for help with navigating your business amid the current financial challenges.

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