Quantcast
Published On: Thu, Jul 2nd, 2015

7 Little Known Ways to Fund Your Small Business

One of the biggest problems for any business when first starting up is cash flow. Many a good business idea has been blown up before a company even got a chance to get going because they were undercapitalized right from the start. Everyone knows that you can go to the bank or the government to get a loan for your small business but there are other ways to help fund your small business to get it going too. Here are five little known ways that are gaining in popularity to get funding for your startup business.

1. Crowdfunding

There are many people out there that have managed to save a good amount of money and they are willing to risk some of that on funding a startup up business for the higher percentage return on investment that it may offer them. These people list the amount of money they want to invest online with a third party that facilitates putting these investors’ money together with small business owners like you that are looking for a cash infusion for your business; this is called crowdfunding. These types of sites are becoming easier to find on the internet these days and should strongly be considered when looking for more working capital for your business.

2. Angel Investor

Angel investors are very similar to venture capitalists but without all the strict supervision that comes with dealing with a venture capitalist. These loans usually involve much less money than venture capital loans as well. In return for their funding an angel investor will typically expect a 20 – 25% return on their investment in a short amount of time.

3. Invoice Advances

This form of small business funding is becoming more and more popular for startups. It is very similar to a loan but it usually involves payments that are a percentage of such things like a day’s total credit card receipts. The creditor is basically loaning you money against potential future sales. The advantage to this type of credit is that you do not usually need collateral for the loan as you would a loan from the bank. Some prefer to call this type of loan a Merchant Cash Advance.

Good Idea on a chalkboard photo/ Michael Jarmoluk via pixabay.com

Good Idea on a chalkboard photo/ Michael Jarmoluk via pixabay.com

4. Asset Sell Off

Many people overlook the obvious when searching for funding for their business startup. The Recreational Vehicle (RV) that you own and are going to be too busy to use as you are starting up your business, or your sports car that sits in the garage covered most of the time, may bring the cash you need to get your business off the ground nicely.

5. Grants

There are grants available to certain types of business from the government; this is especially true for tech related businesses and science related businesses. In order to be approved for a grant there needs to be a chance your product or service has a high potential for increased commercialization.

6. Ask Family and Friends for Funding

What is one of the most tried and true forms of getting help with the funding for your startup? That would be going to family members and trusted friends for some help. Many times family and friends will help you without asking for anything in return but still you want to include them in on at least a small percentage of the profits that your business will generate. They will also most likely put less pressure on you for payback than other funding sources but you will probably feel more guilty if you can’t do it and it could cost you a friendship if not done in a timely manner.

7. Peer to Peer Loans

You would be surprised how many people have established successful businesses that are willing to help out start-ups such as yours for a very small fee. An internet search will provide you with a list of sites that will act as a liaison between you and the peer investor to get together. Not only will you have a chance of getting the money for your start-up that you need but you may also develop a new friendship and get some sound business advice along the way too.

If your business needs a cash infusion to get going there are a lot more funding sources out there than meets the eye. So take the time to look around and see what is available. If you have a sound business plan and potential for sales you will be able to find the startup money you need for your business.

Guest Author: Keith Sullivan

About the Author

- Outside contributors to the Dispatch are always welcome to offer their unique voices, contradictory opinions or presentation of information not included on the site.

Tags
Displaying 3 Comments
Have Your Say
  1. Business Rv Financing | Best Credit Debt says:

    […] 7 Little Known Ways to Fund Your Small Business – Some prefer to call this type of loan a Merchant Cash Advance. Many people overlook the obvious when searching for funding for their business startup. The Recreational Vehicle (RV) that you own and are going to be … […]

  2. What Is The Canadian Small Business Financing Act | Credit Debt says:

    […] 7 Little Known Ways to Fund Your Small Business – Many a good business idea has been blown up before a company even got a chance to get going because they were undercapitalized right from the start. Everyone knows that you can go to the bank or the government … […]

  3. Ways To Secure Financing For A Small Business | Credit Debt says:

    […] 7 Little Known Ways to Fund Your Small Business – Everyone knows that you can go to the bank or the government to get a loan for your small business but there are other ways to help fund your small business to get it going too. Here are five little known ways that are … […]

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>



Recent Posts

Categories

Archives

At the Movies