Fund your Tennessee business

When your own money is not enough, start with an advisor, then read which program actually lends. The Tennessee SBDC does not lend. LendTN sits with a local lender. Regular SBA loans also come from a lender. InvestTN buys an ownership share in an early-stage company.

What’s different in Tennessee

• Advising is free. The Tennessee SBDC offers advice, consulting, and educational opportunities at no cost¹.
• The state loan program needs a lender. LendTN is borrowed funds paid back with interest to a lender, for small businesses registered in Tennessee. The state page says the program is deploying funds statewide².
• Equity is a separate door, and it is not for every new shop. InvestTN is equity, an ownership share, for early-stage startups².
• One SBA office covers the state, with two places to call. It has the Nashville office, by appointment, and a virtual office in Memphis for Carroll, Crockett, Dyer, Fayette, Hardeman, Haywood, Lauderdale, Madison, Shelby, and Tipton counties⁶.

Do this

1. Write down what you need and what it is for. LendTN’s eligible uses include equipment, working capital, real estate, and new businesses, among other uses. Ineligible activity includes speculative activity, a company that earns more than half its revenue from lending, pyramid sales, activity prohibited by federal law, and gambling³.
2. Book advising. The Tennessee SBDC says it provides advice, consulting, and educational opportunities at no cost¹. Choose the center for your county on that page. AssistTN, the technical-assistance piece of Fund Tennessee, sends you to the same network. The angel-investing class on the AssistTN page is separate: the angel-investing course is offered for a limited time at no cost, and the next cohort's application period is open⁵. That class is training. It is not a loan.
3. Use the SBA office. The Tennessee District Office serves the entire state. It helps with funding programs, counseling, federal contracting certifications, and disaster recovery. It has the Nashville office, by appointment, and a virtual office in Memphis for Carroll, Crockett, Dyer, Fayette, Hardeman, Haywood, Lauderdale, Madison, Shelby, and Tipton counties⁶.
4. Understand who lends the regular SBA loans. 7(a) loans are delivered by SBA 7(a) lenders. Microloans are provided by intermediary lenders⁷. The SBA loans guide explains who makes each kind.
5. Read LendTN before you assume the state will lend to you directly. The LendTN page says you connect with a participant lender. Each participant lender sets its own minimum and maximum loan amounts. A business can receive up to 5 million dollars in SSBCI funds, and no project may exceed 20 million dollars. There is no fixed deadline, and lenders are taking applications on a rolling basis. A decline can come with a referral to technical assistance. It does not come with a promise of a different state loan. Who can apply: a sole proprietor or general partnership registered with the clerk and the Department of Revenue, or a corporate entity registered with the Secretary of State that has 51 percent of its employees living in Tennessee and either a headquarters facility in Tennessee or most of its senior management living in Tennessee. The page also says a business that receives the loan should remain in Tennessee for no less than 24 months³.
6. Read InvestTN only if you are raising equity. The InvestTN page is for early-stage startups. The Regional Seed Fund makes initial investments of 25,000 to 250,000 dollars in pre-seed and seed startups, through seven regional centers that serve all 95 counties. The Growth Fund makes investments of 250,000 to 3 million dollars in Tennessee companies at the seed, Series A, and Series B stages. A separate track puts 1 million to 3 million dollars into new venture funds, not into an operating business⁴. Applications go through the page and through Launch Tennessee’s regional centers. A coffee shop that is not raising a round is not the reader that page describes.
7. Do not pay someone who promises a guaranteed grant. The Fund Tennessee pages name loans, equity, and advising. They do not name a grant that every new business can claim. Be wary of anyone selling access to one.
8. Keep your paperwork ready. Lenders and advisors ask for your formation documents and EIN. Register your business and Get your tax IDs.
9. 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 way to reach a lender or an equity fund if you fit that program. A loan decision comes from the participant lender, or from an SBA lender, or from the SBA only on a disaster loan you qualify for. An equity decision comes from InvestTN only if it chooses to invest. These pages do not promise a finished plan or an approval.