Fund your Massachusetts business

When your own money is not enough, start with no-cost advising, then read which program actually lends. MassDevelopment can lend to the business on a microloan and on a working-capital term loan. It can also guarantee part of a bank loan. Regular SBA loans come from a lender. A brand-new business is outside the working-capital programs on the page below.

What’s different in Massachusetts

• Advising at the SBDC is no-cost. Training is no cost, or a nominal fee¹. A business that has not launched has a class to finish first.
• MassDevelopment can be the lender. The microloan is not a referral that only a bank can fund. The working-capital term loan is often next to a bank, with the bank in the senior position.
• Those loans are not for a startup. The working-capital page says it does not help pre-revenue, startup, or early-stage businesses, and its exclusions include startups. The microloan also requires an existing for-profit business, or a nonprofit childcare business, with headquarters in Massachusetts, that has been operating for at least 12 months².
• The named small-business grant to the business is closed. The deadline to apply has passed⁵. The other small-business grants on the list pay nonprofits and lenders.
• One SBA office covers every county. It is in Boston⁶.

Do this

1. Write down what you need and what it is for. A microloan, a term loan, and a bank guarantee are different asks. The microloan covers working capital or furniture, fixtures, supplies, materials, and equipment. Loans on the working-capital page cannot be used to pay taxes.
2. Book no-cost advising. The Massachusetts SBDC offers no-cost, confidential advising for prospective and existing for-profit small and mid-sized businesses. Advising is in person or virtual, through six regional centers and three specialty programs. Services are not available at the state office. Send the request for advising before the first appointment. If you have not launched or earned revenue yet, you take a required 2-hour online How to Start a Business series before your first advising appointment. Training is no cost, or a nominal fee¹. The SBDC does not lend and does not promise an approval.
3. Use the SBA office for the whole state. The Massachusetts District Office in Boston covers the entire state, all 14 counties⁶. There is not a second district office for part of the state.
4. Understand who lends the regular SBA loans. On the SBA loans page, 7(a) loans are delivered by SBA 7(a) lenders and microloans are loans of 50,000 dollars or less from intermediary lenders⁷. The SBA loans guide explains who makes each kind.
5. Read the MassDevelopment microloan before you assume the state will not lend. On the working-capital page, the microloan is 5,000 to 100,000 dollars, amortized up to 6 years. It is for an existing for-profit business, or a nonprofit childcare business, with headquarters in Massachusetts, that has been operating for at least 12 months. The microloan requires a personal credit score of at least 575, on the microloan list. The same page's question about a minimum credit score is answered no².* Those two parts of the same page do not agree. Ask which product you are applying for, and use the score that product prints. Some industries are ineligible, including real estate investments. The business gives a lien on its assets and a personal guaranty.
6. Use the term loan or the guarantee when the amount is larger. A term loan is up to 2 million dollars and is often alongside a bank, and the bank typically has the senior position on the assets. The rate is based on the market. Fees are 1 percent at commitment and 1 percent at closing. The owners the page names give a personal guaranty. MassDevelopment can also give a guarantee that lets a bank enhance its loan, up to 2 million dollars and not more than 75 percent of the bank's facilities, on a term loan. That guarantee also has a personal guaranty from those owners. The working-capital page says it does not help pre-revenue, startup, or early-stage businesses, and its exclusions include startups².
7. Read SSBCI as loans and guarantees that still need a private lender. The loans page says loans and guarantees, with a particular focus on SEDI businesses³. The brochure that page links, dated January 2023, says a private lender has to lend at least as much as the SSBCI piece. The caps on that brochure are up to 10 million dollars for real estate acquisition, construction, and renovation; up to 2 million for improvements, term working capital, and leasehold improvements; equipment from 100,000 to 3 million dollars; guarantees up to 50 percent of the loan⁴.* Confirm the cap on the application you submit. The loans page also lists other programs, such as brownfields loans and the Emerging Technology Fund.
8. Read the grant list before you treat it as startup cash. Biz-M-Power is a matching grant for a growth-oriented business with fewer than 20 employees and no more than 2.5 million dollars of revenue, and the owner has to show 20 percent of the funds at application. The deadline to apply has passed. The technical-assistance program is grants of up to 150,000 dollars in FY27 to Massachusetts nonprofits that assist small businesses, not a check to the business. The lending-capital match is a grant to certified nonprofit community lenders, so they can lend to businesses with fewer than 20 employees and no more than 2.5 million dollars of revenue⁵. A business does not apply for those two. It may later borrow from a lender the grant supported. Be wary of anyone selling access to a guaranteed grant.
9. Keep your paperwork ready. Lenders ask for formation documents and an EIN. Register your business and Get your tax IDs are the Massachusetts versions.
10. After a declared disaster, the SBA can lend directly. Disaster assistance covers several kinds of loan the SBA makes itself after a declared disaster, including physical damage, economic injury, and military reservist economic injury, and only if you qualify⁸. A disaster by itself does not qualify you. Check the declaration and the loan type before you apply.

What you get back

An appointment with an advisor, and a class if you have not launched yet. A loan decision comes only if you qualify, from MassDevelopment on a microloan or a term loan, from a bank on a guaranteed loan, and from MassDevelopment on whether it guarantees that loan. A grant decision comes only if a program on the list is open and you are the one it pays. These pages do not promise a finished plan or an approval.