There’s more to Minnesota than snowy winters and crystal clear lakes—this state boasts a vibrant economy that is friendly to small businesses. In fact, over half the state’s workforce is employed by small businesses, making entrepreneurs a vital part of the landscape. If you run a business in the North Star state, you may be eligible for one of the small business loans and grants listed below. Read through to find out if you qualify.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Emerging Entrepreneur Loan Program
The Emerging Entrepreneur Loan Program (ELP) provides funds to nonprofit lenders, which then loan the money to businesses owned and operated by minorities, women, veterans, or people who are low-income or disabled. To qualify, your business must operate in Minnesota. DEED will provide funds between $5,000 and $150,000 per project.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Minnesota Job Creation Fund
This program provides awards of up to $1 million ($2 million in some cases) for companies that engage in manufacturing, warehousing, distribution, and some IT operations. To qualify, the business must fulfill certain requirements, such as creating at least 10 new full-time permanent jobs within two years of receiving the award. Funds can be used to create or retain high-paying jobs, build or renovate facilities, and make other property improvements.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Native American Business Loan Program
This program provides business loans to Native Americans based in Minnesota. To qualify, the business owner must be an enrolled member of a federally recognized band or tribe in the state. The business can be located anywhere in the state, but most loans are made to businesses on reservations.
Department or Agency: Launch Minnesota
Loan or Grant title: Innovation Grant
Launch Minnesota offers innovation grants for technology-centered businesses across Minnesota. The grants are available for up to $35,000 to pay for research and development, direct business expenses, and technical assistance. To qualify, the business must be involved in innovative technology, be located in Minnesota, be in operation for fewer than 10 years, have less than $1 million in equity financing, and not have previously received a Launch Minnesota Innovation Grant.
Department or Agency: Launch Minnesota
Loan or Grant title: Small Business Innovation Research (SBIR)/Small Business Technology Transfer (STTR) Matching Grant
Launch Minnesota offers SBIR/STTR matching grants to eligible first-time Phase I and Phase II awardees. The award amount is based on the business’s federal award. To qualify, the business will need to register with the Minnesota SBIR/STTR (MNSBIR) Accelerator, show it won federal SBIR/STTR funding after July 1, 2022 (and have at least 120 days remaining in the project period upon application submission), and be located in Minnesota.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Minnesota Investment Fund
The Minnesota Investment Fund is a loan program available to businesses engaged in manufacturing, warehousing, distribution, and technology-related industries. To qualify for a loan, businesses need to meet certain job creation and capital investment minimums.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: MN Reservist and Veteran Business Loan Program
This loan program is designed to support two groups of people: 1) businesses that have had employees called away to active duty and 2) individual veterans returning from service who need help starting a business. Loans have no interest and range from $5,000 to $20,000. The repayment period is 54 months, with no payment required for the first 18 months.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Minnesota 21st Century Fund
The Minnesota 21st Century Fund makes loans or equity investments in innovative mineral, steel, or other industry processing, production, manufacturing, or technology projects located in the taconite relief tax area.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Automation Loan Participation Program
DEED offers gap financing loans to businesses in manufacturing, distribution, technology, and warehousing in Minnesota. Eligible businesses can get loans up to $500,000 and put the funds toward machinery, equipment, and software purchases.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Growth Loan Fund
The Growth Loan Fund is geared toward Minnesota-based early-stage businesses that have raised less than $250,000, along with slightly later-stage businesses that are not yet ready for a Series A round. Eligible companies can get loans from $100,000 to $400,000 based on 20% of the total investment in a defined funding round.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Minnesota Loan Guarantee Program
Part of Minnesota’s State Small Business Credit Initiative (SSBCI), the Minnesota Loan Guarantee Program supports small businesses. The program provides guarantees for enrolled lenders up to 80% of the loan principal. To qualify, businesses need to have fewer than 500 employees.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Small Business Loan Participation Program
The Small Business Loan Participation Program helps expand financing options for Minnesota-based small businesses with fewer than 500 employees. Businesses can use loan funds for a range of purposes, including equipment purchases, working capital and startup costs, as well as real estate purchase, construction, renovation, or tenant improvements of an eligible place of business.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Direct Investment Venture Capital Program
The Direct Investment Venture Capital Program supports Minnesota-based seed and early-stage startups in advanced manufacturing, agtech/foodtech, climate tech, life sciences, software, and technology.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Community Wealth Building Loan Program
The Community Wealth-Building Loan Program gives low-interest loans to community businesses that are at least 51% owned by people who are Black, Indigenous, People of Color, immigrants, low-income, women, veterans, or people with disabilities. Loan amounts are between $50,000 and $500,000.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Promise Loan Program
The Promise Loan Program is available to businesses in communities that have been adversely affected by structural racial discrimination, civil unrest, lack of access to capital, a loss of population or an aging population, or a lack of regional economic diversification. To be eligible, businesses need to be located in Minnesota, have an annual gross revenue of less than $1 million, and have an eligible renovation, repair, design, or redevelopment project. Loans are up to $1 million.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Promise Act Grant Program
The Promise Act Grant Program gives grants to eligible Minnesota businesses to use on working capital, rent or mortgage payments, utility bills, equipment, and other operating expenses. To qualify, businesses need to be based in Minnesota, have an annual gross revenue of $750,000 or less, and be located in a community that’s been negatively affected by one of the following: structural racial discrimination, civil unrest, lack of access to capital, a loss of population or an aging population, or a lack of regional economic diversification.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Job Training Incentive Program
The Job Training Incentive Program awards matching grants (five:one) of up to $200,000 to businesses that provide training for new jobs. To qualify, businesses need to be located outside of the seven-county metropolitan area or located in the cities of Cannon Falls, Hanover, Rockford, Northfield, and New Prague. Businesses need to create at least three new jobs that pay wages at least equal to 120% of federal poverty guidelines for a family of four. For 2024, this is $37,440 per year.
Department or Agency: Minnesota Department of Employment and Economic Development (DEED)
Loan or Grant title: Automation Training Incentive Program
The Automation Training Incentive Program offers grants of up to $35,000 to small businesses in the manufacturing or skilled production industry—for the purpose of training employees on new automation technology. The program is available to businesses located outside of the seven-county metropolitan area or located in the cities of Cannon Falls, Hanover, Rockford, Northfield, and New Prague. Training is for existing, full-time jobs paying at least 120% of federal poverty guidelines for a family of four. For 2024, this is $37,440 per year.
Department or Agency: Saint Paul Department of Planning and Economic Development
Loan or Grant title: Business Assistance Fund
The city of Saint Paul has a Business Assistance Fund for businesses in Saint Paul that have been unable to access financing from traditional financial institutions. Loans range from $20,000 to $150,000 and can be used for building improvements, equipment purchases, building acquisition, working capital, inventory purchases, and professional fees in conjunction with the completion of the project.
Department or Agency: Saint Paul Department of Planning and Economic Development
Loan or Grant title: Neighborhood Star Program
Saint Paul’s Neighborhood Star Program gives eligible businesses grants for physical improvement projects in Saint Paul neighborhoods. Grants typically range from $5,000 to $200,000.
Department or Agency: Saint Paul Department of Planning and Economic Development
Loan or Grant title: Cultural Star Program
Saint Paul’s Cultural Star Program awards grants to eligible businesses located in Saint Paul’s cultural district. The grants range from $5,000 to $50,000.
Department or Agency: City of South Saint Paul
Loan or Grant title: Small Business and Development Loan Program – Microloan
The city of South Saint Paul offers microloans from $1,000 to $15,000 to use on working capital, inventory, façade and building renovations, purchase and installation of machinery and equipment, energy efficiency upgrades, and general operations. Businesses need to have fewer than 50 employees to qualify.
Department or Agency: City of South Saint Paul
Loan or Grant title: Small Business and Development Loan Program – Gap Loan
The city of South Saint Paul offers Gap loans from $15,000 to $150,000 to use on job creation or retention, building or land acquisition, new construction, renovations, machinery and equipment purchases, and infrastructure improvements.
Department or Agency: Neighborhood Development Center
Loan or Grant title: Small Business Loans
The Neighborhood Development Center is a certified CDFI that has a range of business loans for Minnesota-based operations. Their small business loans are for existing businesses and range from $50,000 to $250,000. Businesses can use the funds to pay for working capital, buy inventory, purchase equipment, or acquire real estate.
Department or Agency: Neighborhood Development Center
Loan or Grant title: Microloans
The Neighborhood Development Center also offers microloans to new and existing Minnesota businesses. The loan amount goes up to $50,000.
Department or Agency: City of Minneapolis
Loan or Grant title: Two Percent Loans
The city of Minneapolis has Two Percent Loans for businesses that need help financing building improvements and equipment purchases. For businesses in designated commercial areas, the city can match private lender funds up to $75,000; for businesses outside designated commercial areas, the city can match private lender funds up to $50,000. The interest rate is 2%.
Department or Agency: City of Minneapolis
Loan or Grant title: Business Development Fund Loans
Minneapolis’s Business Development Fund Loans are for Minneapolis manufacturing, industrial, and distribution businesses that need financing for building improvements, production equipment, inventory, moving costs, and working capital. Eligible businesses can get prepayment credits for hiring Minneapolis residents. Here’s how it works: a business gets a loan from a private lender for at least half of the total project costs, and then the city will match private lender funds up to $75,000.
Department or Agency: City of Duluth
Loan or Grant title: Duluth 1200 Fund – General Loan Program
The city of Duluth offers low-interest business loans to existing businesses that have been in operation for at least three years. The loan maximum is $500,000. Eligible businesses include service businesses, wholesale, and manufacturing businesses. Legal, architectural, financial services businesses, non-profits, and retail operations aren’t eligible to apply.
Department or Agency: City of Duluth
Loan or Grant title: Duluth 1200 Fund – Advance Loan Program
Duluth’s Advance Loan Program provides gap financing to Duluth-based startups for the purpose of making real estate improvements. The loan maximum is $50,000. Up to 50% of the loan may be forgiven if two full-time or full-time equivalent jobs are created on the site within the first two years of operation.
Department or Agency: City of Duluth
Loan or Grant title: Duluth 1200 Fund – Mentorship Loan Program
Duluth’s Mentorship Loan Program supports businesses with startup costs and helps connect them with mentors. The loans range from $3,000 to $15,000.
Department or Agency: City of Duluth
Loan or Grant title: Duluth 1200 Fund – Childcare Loan Program
Duluth’s Childcare Loan Program provides gap financing to licensed Duluth childcare providers who are starting up or expanding within Duluth city limits. The three programs are as follows: the Childcare Loan Program offers a minimum loan of $10,000; the Childcare Incentive Program has a loan maximum of $50,000; and the 1200 Fund Childcare Collaboration Grant has a maximum of $100,000.
Department or Agency: City of Brooklyn Park
Loan or Grant title: Real Estate/Equipment Loan
The city of Brooklyn Park offers loans from $50,000 to $300,000 to businesses located in Brooklyn Park. At least 50% of the project financing must come from a private lender or another source.
