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As a business owner, there will be many times that you will need funding to take care of an expansion, an emergency, or to remodel your facility. There are several sources available to you to get this cash and keep your operation running. Here are a few options to finance your small company.
- Personal Savings: Your own finances can act as the initial seed capital, proving commitment to potential investors.
- Angel Investors: Connect with affluent individuals looking to invest in start-ups they believe have growth potential.
- Venture Capital: Engage with VC firms interested in high-return investments; typically they seek equity in return.
- Crowdfunding: Utilize platforms like Kickstarter or Indiegogo where the public can pledge to your business idea.
- Small Business Loans: Investigate bank and credit union offerings, often with favorable terms for budding entrepreneurs.
- Grants: Delve into opportunities from government or private sectors that offer funds without the need for repayment.
- Business Competitions: Showcase your idea in contests with cash prizes or investment opportunities for winners.
- Peer-to-Peer Lending: Explore platforms like LendingClub, connecting businesses with individual lenders, often without traditional bank bureaucracy.
- Trade Equity: Offer a portion of your business’s ownership in exchange for essential capital or services.
- Strategic Partnerships: Forge alliances with established businesses; they can offer financial or resource-based support.
Talk To Your Bank
Make an appointment with your financial institution to find out what type of funding they have available for you. If you are having an emergency with a business that you already own, MaxLend loans might be your solution. Entrepreneurs wanting to open their doors for the first time should ask for assistance from the Small Business Administration. Regardless of which option is best for you, you will need to submit your credit rating when you apply as well as a business plan and record of your company’s income.As a business owner, there will be many times that you will need funding to take care of an expansion, an emergency, or to remodel your facility. There are several sources available to you to get this cash and keep your operation running. Click To Tweet
Look At Your Own Assets
Analyze your bank accounts, stock investments, retirement funds, or the property that you own to see if there is an amount that you can withdraw from them to pay for the expenses that your business needs. Doing this is referred to as bootstrapping. While it lessens the money you have to rely on, it avoids adding additional debt to your company. Speak to a financial advisor about this method of lending before you proceed further. There may be fees assessed to you if you withdraw cash too early so you will want to keep that in mind.
Utilize Your Credit Cards
Another option that you have available to you is to use the personal credit cards that you carry with you. This is ideal if you are having an emergency or you only need a small amount of money. Verify what your interest rate is on your card as well as the fee that will be assessed to you if you withdraw cash from it. One advantage to using this method is that you can apply it to any item that you require. Most loans are dedicated to a certain aspect of your business, such as construction. This allows you the freedom to spend it on whatever you want when you must have it.
Reach Out To Family and Friends
People who are close to you and believe in what you are doing can become investors in your small business, especially if they have the funding to assist you. Share with them the business plan that you have assembled and ask if they would like to contribute to your venture. You will need to contact a lawyer to draw up paperwork for your agreement. Be sure to make your payments on time to these individuals to keep your relationships intact and to prevent any awkwardness between you. You can also research investment organizations that might offer you cash for a portion of your company. You will want to determine what percentage you are willing to give up before you talk with them. One advantage of working with these professionals is that they can give you guidance as you manage your employees and facility.
Small business consultant and author Michael E. Gerber, with sharp insight gained from years of experience, points out how common assumptions, expectations, and even technical expertise can get in the way of running a successful business.