So you’ve decided that you want to start your own business. You’ve built your business plan, including revenue projections. What’s the next step? Funding. How exactly are you going to start this business, especially if you do not have all of the capital to get going? Acquiring a loan from the bank is not always the easiest option, but thankfully, it is not the only option. Below are a few options to get your business up and running.
Government grants are a great option because they are not required to be paid back. However, there are a few downsides. Grants usually come with stipulations, such as strict application requirements and periodic updates on the status of your business. Entrepreneur’s 11 Grants for Women-Owned Businesses You Need to Know About is definitely worth a read.
2. Online Lending
This is quickly becoming another way to receiving business loans. The biggest advantage is they are much faster than the typical bank loan process. A few sites gaining popularity are OnDeck and Kabbage, which are both rated A+ with the Better Business Bureau (BBB).
Within the past couple of years this option has become a popular way to raise money for anything from help with medical bills to college tuition. Sites such as Kickstarter and GoFundMe allow users to pool from multiple potential investors. There are regulations on some platforms, such as the site keeping a percentage of earnings.
4. Friends and Family
The age-old way of getting a loan is still very effective. Lenders only invest in businesses they believe in, partially because they trust the founder. This option allows for more flexibility with matters such as length of repayment and interest rates. As long as you show your loved ones how serious and dedicated you are by having a strong business plan, it’s worth it asking them to invest in you.
The best way to find funding to jump-start your business is to do research. A great tool is Fundera. It allows users to compare a list of lenders based off of the information they entered about their business. Another great way to do research is to ask other entrepreneurs with a currently running business for advice; they were once in your shoes and will most likely provide great financial pointers.