The State of Small-Business FundingFrom banks to VCs, there's plenty of cash out there for entrepreneurs. But that doesn't mean the road to finding financing has gotten any shorter or smoother.

Bige Doruk founded Gaia Power Technologies Inc. at a doubly good time. Interest in energy storage and management products has soared in step with record-high oil prices. And opportunities to finance the growth of her New York City company, which manufactures devices to help businesses attain reliable backup power and reduce overall energy costs, have rarely been better. At 4 years old, the company has secured a total of $4 million from three separate financings involving a combination of angel and VC equity investments, a bank loan, and a grant from a state-government-backed research fund.

Gaia's financing run began in 2003 with a $1.5 million product-development grant from the New York State Energy Research and Development Authority. The next year, a $250,000 loan from a consortium of large banks called the New York Community Investment Co. helped complete the product development effort. Last summer, a group of VCs and angels made a $2.25 million equity investment in the $3 million firm to expand operations and marketing. "It's been great for us," Gaia's 38-year-old CEO says. "We didn't have to tap into the capital market and give up equity without having a product and a market."