In any given business, money is the most important asset to start and run a business especially small businesses who want to survive the very competitive business world. Entrepreneurs who are on the threshold of a new business venture must work out in finding success by obtaining sufficient funds.
Most probably, the thing that comes to your mind when it comes to getting a capital to run a business is through borrowing or lending from a bank and or from financial institutions which are in fact, the ones who are responsible for lending Small and Medium Enterprises (SME’s) to roll out their business and have a good start by lending them funds in the form of alone. Although banks and financial institutions are very strict when it comes to giving you approval for your loan application, there are actually alternatives that you can try.
If you are planning to open up a business, but you do not have an idea where to get the much-needed finance and funds as your capital, check out the rest of this article that will give you the five types of financing options that are ideal to kick start your small business.
- Financial institutions and banks- A need to invest in funding at the early stage or high growth phase of your business if you require a mentor to help you grow your business or if you do not have a physical product or service, but you have a good idea about your business plan, and if you are willing to give up a percentage of your business to the investor just like a Personalised business finance.
- Crowdfunding- This can help you in the early stages of your business to get off the ground if you are able to pre-sell a product or service to your target audience as some sort of your marketing experiment. Also, if you are able to harness or gather an audience in the social media to convince the crowd funder of your target audience’s testimonials and if you are not willing to give up a percentage of your equity in your business. More funding is needed as crowdfunding is provided in smaller amounts than a comparative and reliable investor.
- Business loan- In banks and financial institutions, a business loan is one of the most flexible and quick solutions that can be repaired in fixed installments and terms. If you need a cash injection to purchase new equipment for your business, new machinery, new company vehicles, or to fund your marketing campaign, and also to fund seasonal fluctuations in trade according to Business Financing Specialists.
- Asset-based lending-This type of finance options is when you are planning for expansion based on your current business assets. If you want to make your business grow bigger. If you need to purchase new or additional property or if you need financial assistance for your export and import needs.
- Peer to peer lending- This is when you need to fund a specific project or if you have more time on your side when you cannot get money in your bank within the fastest time. If you are not worried about flexibility, as more people are getting involved in the terms are more rigid of extending.