If you have had an awesome small business idea and want to get it started as quickly as possible, it’s likely that you might need some additional funding in order to get your business off the ground. The amount of funding that you will need and where you will get it from will usually depend on the type of business that you want to launch, your plans for it in the future, and how much you will need to invest in it to achieve your goals. While getting a business loan from the bank might be the first type of financing that you think of when in this situation, the sad truth is that many business loan applications for small and new businesses get rejected. So, what are some alternative options to consider?
Small Business Loans:
You may be able to get a small business loan from the US Small Business Administration (SBA), which oversees millions of loans around the country each year. SBA loans are some of the most affordable and the safest options for small business owners, and you are more likely to have your application accepted in comparison with applying for a bank loan. However, it isn’t easy to get approved and you will need to be careful with your application in order to ensure that you’re in with the best chance of getting the funding you need. Check out more SBA loan advice here to get started.
Crowdfunding:
Another option that you might like to consider for your small business is crowdfunding, where you will ask members of the public to invest in your small business. Crowdfunding investors can choose to invest a small or a large amount, making it a relatively low-risk option for them and an opportunity to be a part of starting a business that they like the idea of. There are various popular crowdfunding sites worth considering, such as Kickstarter.
Angel Investors:
With bank loans becoming harder and harder to get, angel investors are financing more small businesses and startups than ever before. An angel investor can help you in many ways other than just providing the funds that you need. When working with an angel investor, they will buy a share of your business and therefore become a major shareholder whose opinions count. Many are experienced entrepreneurs who can help you steer your business towards success.
Personal Funding:
You also have the option to fund your business yourself or even using a personal loan, as long as the terms and conditions of the loan do not state that it cannot be used for business purposes. Another option to consider is asking your friends and family members to lend or donate the funding for getting started in your business, perhaps in return for a share in the company and the profits when you begin to grow.
Starting a small business is a great career path for many, but additional funding is often required. Since getting a bank loan is no longer as easy as it once was, it’s worth considering these alternative funding options.
