Every business needs some type of business finance in order to get up and running. Working with the right type of lender will allow you to acquire the funding you need to expand your business, hire new employees, purchase new equipment, along with a number of other things. Here are some places you need to look when you are trying to acquire business financing:
1. Angel Investors. Instead of working with local banks and other lenders to finance your business, consider working with angel investors. In order for an angel investor to give you the time of day you need to have a solid business credit rating, cash flow projections, an updated business plan, and you must be in business for at least 5 years. Angel investors will offer you financing based on the fact that they feel your business will grow rapidly in the near future and they can profit from your success.
2. Commercial lenders. Another great option for business finance is to work with commercial lenders. If you already have experience with them, they are likely to offer you the financing you need. Be careful about your business credit and make sure you don’t have too much debt or the lender will see this as a high risk. If you have little or no collateral, you may be unable to secure a loan from a traditional lender.
3. Small Business Administration. The SBA hands out a number of loans to small businesses each year. With an SBA loan you can easily gain up to $2 million to start up your business. You will need to plan on investing at least 30% of your own money in the company in order to gain approval for the loan as this shows your commitment and devotion to the small business.
4. Credit cards and unsecured loans. Depending upon the amount of business finance you need, you can turn to unsecured loans. Credit cards are commonly used for small business owners as they provide large spending limits and fair interest rates. Research multiple lenders to find the correct credit card or unsecured loan for your small business.
5. Leasing. This is a great option if you have equipment break down and you need to purchase new equipment. Leasing allows you to purchase brand new equipment to make your business more profitable. It’s a great option for small businesses that are unable to secure other forms of business finance.