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12 Funding Options for Rural Entrepreneurs
by Brett Farmiloe
February 2, 2023
Lending and subsidizing farmers.

To help you identify funding options for rural entrepreneurs, we asked successful entrepreneurs and business owners this question for their best recommendations. Several funding sources are available for rural entrepreneurs to explore, from crowdfunding to small business loans to state trade expansion programs.


Crowdfunding is an effective funding option for rural entrepreneurs. It helps finance their project or venture by raising small amounts of money from people online. 

Ordinary people usually make investments through crowdfunding platforms. They do so out of strong belief in the initiative without expecting a return on investment. An initiative must be simple yet meaningful and easily understood by the general public to earn ‘investors.’ Aside from monetary support, crowdfunding investors could also give feedback and recommendations to help run a business. Likewise, they become part of the business’ growing customer base and become more aware of its purpose.

Ryan Stewart, Webris

Program for Investors in Microentrepreneurs

Small firms rarely receive grants directly from the SBA. On the other hand, the Program for Investors in Microentrepreneurs (PRIME) provides federal subsidies to microenterprise development organizations to assist marginalized microentrepreneurs. Investors can be private, non-government organizations (NGOs) or run by the state, county, or tribal governments. In 2021 the Nebraska Enterprise Fund and the Micro Enterprise Services of Oregon received grant money.

Gerrid Smith, Joy Organics

Government Grants

Government grants are an excellent option for rural entrepreneurs starting or expanding their businesses. Many agencies offer grant programs specifically for rural businesses, including the Small Business Administration (SBA), the Rural Business Enterprise Grant Program (RBEG), and the USDA Rural Development program.

Ilija Sekulov, Mailbutler

Small Business Loans

Small business loans are a viable option for entrepreneurs looking for funding. There are many banks and lenders that offer small business loans, and the terms and interest rates vary depending on the lender. For rural businesses, there may be special programs or incentives offered by lenders to encourage lending in rural areas. If you choose this route, always compare offers from multiple lenders and select the one that is best for your business.

Marc De Diego Ferrer, MCA Assessors

Technology Support and Funding for Rural Entrepreneurs

The Small Business Administration offers two programs to award funds for research and development and commercialization for rural entrepreneurs. The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) allow rural entrepreneurs to explore and implement technological tools they often can’t access. Since they are highly competitive programs, the SBA has also created the Federal and State Technology (FAST) Partnership Program, which provides funding for regional programs and increases the rewards offered by SBIR and STTR. It allows disadvantaged or overlooked individuals in the business sector, including those in rural areas, to access technology training that helps them scale their businesses.

Justin Soleimani, Tumble

America's Seed Fund

America’s Seed Fund invests up to $2 million in businesses, including those in rural areas, while taking absolutely no equity from entrepreneurs. Through their competitive application process, they annually provide a collective $4 billion in early-stage capital. Suppose your business aims to transform culture and create new jobs, especially in the sciences, technology, and engineering. In that case, you may be a fantastic fit for the program. You can find local state, and regional programs to assist you with grant-writing and business counseling.

Ruben Gamez, SignWell

Incubator Programs

There is a range of incubator programs available to new startup companies that provide professional support and can garner interest for funding. Though you have to apply for acceptance into an incubator program, it's worth expressing interest in multiple. In the case of rural tech entrepreneurs, you may want to consider more, as you will have access to exclusive resources and mentors for the duration of the program. Further, as a participant in an incubator program, investors feel more comfortable funding startups that have received the niche education required to run a successful company.

Cesar Cruz, Sebastian Cruz Couture

Rural Funding Initiative

Raising funds to start or develop a business is always a challenge. But, as an entrepreneur, you must be prepared to face all sorts of difficulties. No matter your business, you should always seek funding opportunities. The Rural Funding Initiative is a program that helps rural entrepreneurs secure funding for their businesses. The Rural Business Council oversees the funding initiative and gets extra support from the Federal Government. The program offers up to $20,000 worth of concessional loans. Business operators and developers from rural and regional areas seeking to expand or diversify their business operations receive the funds from these loans. Rural businesses can be anything from small-scale farmers to small or large-scale rural manufacturers and tourism operators.

Richard Morgan, Cyclone Computers

Venture Capital Funding for Rural Entrepreneurship

Getting a capital venture is the ideal financial source for funding rural entrepreneurship. This type of funding is a professionally managed fund that provides vital expertise and mentorship to entrepreneurs and business leaders. Capital Venture companies offer the best chance of increased success for any startup. They play the role of a litmus test; this can determine the organization's growth trajectory and evaluate the business's sustainability and scalability. The fund granted by capital venture sources ensures your enterprise becomes a fast-growing company. 

Suppose a Capital Venture company would award funding to a rural entrepreneur. The Capital Venture company would believe the rural business has enormous potential because investments are only awarded to enterprises that would reach market standing stabilization,  have good market traction, and have positive overall financial growth. This fund channel would also push entrepreneurs to get their business to take off as repayment schemes are usually tight.

Collen Clark, Schmidt & Clark, LLP

The Rural Energy for America Progra

The Rural Energy for America program provides guaranteed loan financing for rural small businesses to make energy improvements or renewable energy systems. The program helps boost American energy independence and lower the energy cost for small businesses over time. Agricultural companies can apply for new system production and energy-efficient equipment loans. You qualify to apply if your business is in a rural community with fewer than 50,000 people.

Erin Banta, Pepper

Small Business Administration CDC/504 Loan

If you're a rural small business seeking funding, you could qualify for an SBA 504 loan. The federal government backs the Small Business Administration (SBA) CDC/504 loans. You can use them for purchasing fixed assets like real estate and large machinery to start your business or expand your existing one. You cannot use the loan for refinancing, operating capital, inventory, or real estate investment. 

Loan terms are from 10 to 25 years with below-market interest rates fixed for the life of the loan. Five hundred four loans safeguard your operating capital since only a 10% borrower contribution is required. The rest of the funding comes from a Certified Development Company (CDC) and a bank. Check with the SBA to see if your small business qualifies for this loan.

Kevin Huang, Ambient Home US

State Trade Expansion Program

To help small firms enter or develop into overseas markets, the SBA provides state governments with cash to operate the STEP grant program. Depending on your state, you may be eligible for a variety of government small-business subsidies that can apply to the following: participating in export trade exhibitions, building foreign marketing items, assisting website globalization, and more.

Kenny Kline, BarBend

About the author
Brett Farmiloe
Brett Farmiloe is the Founder & CEO of Terkel, a Q&A site that converts insights from small business owners into high-quality articles for brands. Brett Farmiloe Founder & CEO,
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Herndon, VA 20170

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Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.

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