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How To Fund Your Small Business

Have a brilliant business idea up your sleeve? But don’t have the money to make it happen. Here are ways that you can reap together funds to get the ball rolling and make your business dream a reality.  

Savings

An obvious one – if you believe your business idea to be highly profitable, your savings should be the first thing you dip into. They’re loan-free and they belong to you.

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Bank Loan

Small business loans and grants can be a great of fuelling the first steps of your business, although decent bank loans are hard to come by these days. Make sure to bring a solid business plan with you when putting the idea across – rustle up an accountant to help you with the figures. This will support your cause and increase your chances of being granted a bank loan.

Family loan

If your family have the wealth at their disposable and see that you are passionate enough about this business idea, they may help you out. No-one likes to borrow from the bank of mum and dad, but you should consider it an option. Just be aware that failure to pay up could affect your relationship with your family.

Broker

A broker may be someone you only think about approaching for a mortgage, but in fact you can hire the services of a business finance broker to borrow money from. They take out loans for you, which they pay back to you in exchange for a percentage, and are specialised in knowing where to look. Like taking a loan out from the bank, you will have to approach them with a viable and honest business plan that they can realistically pursue.

Kickstarter

Kickstarter campaigns have become increasingly more common, relying on the generosity of the public to raise funds for whatever your business pursuit may be. Some businesses have managed to raise thousands through crowdfunding. This involves you putting yourself out there and promoting your business idea in whatever way, shape or form that you possibly can. Even if you don’t want to go through Kickstarter, there are ways to crowdfund independently such as organising a fair or dressing up.

Credit Card

This one isn’t advisable – although may be good for people with a decent credit rating. People have started businesses on the back of flashing their plastic only to spiral into debt. You will need to keep a keen eye of interest rates and if you’re diligent enough, it can pay off.

A Combination of Them All

Using a combination of all these methods you may be able to save up more. You can also ask for less from each source – instead of having to approach one party with a huge loan, you’re asking multiple parties with multiple small loans. The danger comes with not being able to keep track of payments. If you already have enough debts going out, this could just pile on the stress. Only take on what you can manage.

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