Arranging money for your new startup isn’t as difficult as you may think.
However, approaching the correct source of funding may be slightly more complex.
Each source of capital comes with their unique merits and demerits.
To help you find the right source of money you require, we’ve compiled guidelines on financing techniques and what you should know when pursuing them.
Get a Bank Loan
Look for one of the secure ways to arrange money! No doubt, lending standards have become much stricter, but some privately held merchant funding capital companies can earmark additional funds for your small business. They give their clients easy and simple financing options, providing any small to midsized company with the ability to raise cash.
Business cash advance
This is actually not a loan but can be referred to as business advance loans. It’s a purchase a sale of future receivables.
For example, a financing firm can help you raise funds to meet your urgent needs, provided that you sell a portion of your future sales at a discount. So, it’s merely availing a cash exchange for the business owner.
Requirements for a business cash advance may include submitting a one-page application (may differ from company to company), most recent Merchant Processing Statements or Business Bank Statements showing consistent cash flow (many top fundraising companies don’t require tax returns), all credit types considered from excellent to poor. It’s noteworthy that some companies don’t offer services to start-up.
So why not apply?
Use a Credit Card
Using a credit card to fund your business may bring you a serious risk. Fall behind on paying your card bills and your credit scores will get whacked. If you choose to pay just the minimum amount each month, you could be not staying away from creating a hole you will never get out of. However, be assured of using the amount responsibly, and your credit card can pull you out of the occasional jam. And it can also extend your accounts payable period to share up your cash flow.
Attract Angel Investors
This can be a win-win idea. But, when pitching an angel investor, all the previous rules still apply. You need to be succinct. Set out an exit strategy and tend to avoid jargon. However, some business loan have witnessed economic turmoil in the last few years that have this option even more complicated and trickier. Still, we’re sharing you some helpful tips to won over angel interest.
Don’t be a fad-follower:
Ask yourself ‘have you started your company because you are genuinely passionate about your idea? Or, did you start because you want to cash in on the latest trend? Angels consider these facts and are reluctant to assist those whose companies are essentially get-rich-quick schemes.
Try to have a team of highly experienced and skilled advisers as they can add to your credibility. Professionals with more gray hair within your management team will help ease investors’ fears about your company’s ability to deal with a tough economy.
Know your stuff:
All you need is competitive analysis, market assessments and robust marketing and sales ideas if you are looking forward to getting anywhere with an angel. Even new companies like yours need to demonstrate an expert knowledge of the market and can be ready to follow through with their game plan
Keep in touch:
It may be that an angel is not interests in your business the right away. This occurs especially you don’t have a track record as a successful entrepreneur. To cater to that, find a way to keep them in the look on significant developments, like a major sale.
Maybe, you don’t have enough cash to start your business. But, you have a good relationship with people who can invest in your business. Ask them to become your business partner. However, it’s vital to ensure that their goals for the business match yours. It’s advisable to buy out an agreement in place in case of a breakdown in the business relationship.
Thus, these are five reliable resources you can arrange funds for your business. What are you waiting for? Find these resources and arrange money for your business.