Sometimes all a new entrepreneur needs is a list of ideas to get their financial juices flowing. Simple is always better, but in the rush to get things done, entrepreneurs often forget that the easiest ways to get business startup financing are close to home. With this in mind, read through this list and try using it as a brainstorming tool or springboard to bigger and better ideas that will work for your specific business needs. Hope this article will be of great help.
Think you don’t have any cash to fund your business startup? Think again. Most lenders will require the business owner to provide a percentage of cash on their own. So how are people finding this kind of money? By refinancing mortgage or lending terms, selling possessions and/or selling property.
Family and/or Friends
Try talking to some of your closest and dearest to see what they think of your business startup idea. Their responses may surprise you, and if you can provide them with solid evidence that your entrepreneurial venture is a potentially lucrative one, you may have found one of the more popular ways of earning startup financing.
Line of Credit
Although a line of credit isn’t recommended as the sole source of funding for any business startup, it is practically required financing for any fledging entrepreneur in the first few years of business. Why? Because even if you’ve planned for every eventuality, there will always be unexpected expenses, and a line of credit will help you slide through those trying times with relative ease.
Traditional Business Startup Loan
If you do the legwork and create a solid business plan, speaking with your bank about a small business loan might be easier than you think. However, the bank will look for credibility and whether customer lifetime value is offered to survive in the long run, until the loan is repaid.
Private Programs Geared Towards Entrepreneurs
Business startup loans are available through many varied sources; it’s just a matter of finding them and determining whether or not your business idea qualifies. Community Futures or the Business Development Bank are the places to start if you live in Canada.
Government Sponsored Programs
Both the US and Canada have extensive business startup financing programs, as do many other countries around the world. The easiest way to tap into this source of startup financing is to contact your local government branch that deals with small business and entrepreneurship for advice.
There are several different types of investors a business startup could attract: angel, venture capitalist or private. However, new business startups may struggle in earning investor trust on an unproven business idea, so make sure to learn and commit to memory how approaching investors differs from approaching the banks or traditional lenders, first. The SBA now has an Investment Division that may assist new business startups.
Grants sound like a business startup godsend, but in reality, they are a tremendous amount of work. Most entrepreneurial ventures find just sourcing grants they are eligible for to be a tedious process, and even if their business startup does qualify, the process can be daunting.