Minnesota’s economy is built on a diverse mix of industries—manufacturing, agriculture, healthcare, technology, and retail. From Minneapolis-St. Paul’s startup hubs to small-town family businesses across the state, entrepreneurs play a vital role in driving growth. But building or expanding a business often requires outside capital. That’s where exploring funding options for Minnesota’s small businesses becomes essential.
This guide highlights SBA loans, state programs, and local resources available to Minnesota entrepreneurs.
Minnesota is home to more than 530,000 small businesses, employing nearly half the state’s workforce.
Capital-intensive industries like agriculture, medical technology, and manufacturing rely heavily on loans.
Rural communities across the state depend on accessible financing to keep their local economies thriving.
Traditional Bank Loans
Minnesota banks and credit unions—including Bremer Bank, Sunrise Banks, and Affinity Plus—offer business loans with competitive rates. These usually require strong financial history and collateral.
SBA Loans in Minnesota
The U.S. Small Business Administration partners with lenders statewide to improve access to credit. Programs include:
SBA 7(a) Loans: Up to $5 million for working capital, real estate, or refinancing.
SBA 504 Loans: Long-term fixed financing for commercial property or heavy equipment.
SBA Microloans: Up to $50,000, perfect for startups and small-town businesses.
SBA Disaster Loans: Especially important for businesses impacted by flooding, storms, or other natural events.
State and Local Financing Programs
Minnesota Department of Employment and Economic Development (DEED): Provides loan and grant programs, including the Emerging Entrepreneur Loan Program (ELP).
Minnesota Business Finance Corporation (MBFC): A nonprofit that offers SBA 504 loans statewide.
Local economic development authorities offering revolving loan funds in small towns and rural counties.
Alternative Financing Options
Business lines of credit to manage seasonal or ongoing expenses.
Equipment financing for manufacturing, agriculture, or construction companies.
Invoice factoring for companies waiting on customer payments.
Online lenders offering fast approvals, though often at higher costs.
Eligibility and Requirements
Most lenders in Minnesota look at:
Personal and business credit history.
Business plan with growth projections.
Tax returns and financial statements.
Collateral for larger loans.
Loan purpose and repayment strategy.
Check credit score and eligibility
Gather financial records and tax returns
Write or update your business plan
Compare SBA, state, and local programs
Contact lenders or nonprofit organizations
Submit loan application with documents
Await approval and funding
Industries Benefiting Most in Minnesota
Agriculture and food production companies financing equipment and operations.
Manufacturing and industrial firms upgrading facilities.
Healthcare and medtech startups in Minneapolis-St. Paul using SBA and DEED programs.
Restaurants and small retailers across Minnesota accessing microloans.
Resources for Minnesota Entrepreneurs
SBA Minnesota District Office (Minneapolis) for SBA loan programs and guidance.
Minnesota DEED for loan and grant initiatives like the Emerging Entrepreneur Loan Program.
Minnesota Business Finance Corporation (MBFC) for SBA 504 loans.
Minnesota SBDC Network for consulting and financial preparation.
Common Mistakes to Avoid
Applying without a clear business plan or loan purpose.
Overlooking DEED’s targeted small business loan programs.
Borrowing more than projected revenue allows.
Ignoring microloan and revolving loan fund opportunities in rural communities.
Future of Small Business Financing in Minnesota
Entrepreneurs in Minnesota can expect:
Growth in green and sustainable financing options.
More emphasis on minority- and women-owned business loan programs.
Expansion of online loan platforms for faster applications.
From tech startups in Minneapolis to family-owned farms and rural retailers, Minnesota businesses have a wide range of funding opportunities. SBA loans, state-backed initiatives, nonprofit lenders, and local revolving loan funds provide pathways to growth and stability.
Ready to explore financing? Start by contacting the SBA Minnesota District Office, exploring DEED programs, and connecting with your local SBDC. With the right preparation, securing capital for your Minnesota small business is well within reach.