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5 Alternative Ways to Attain Money
for Your Business
 Guest
article by Shannon Suetos
from
Resource Nation
Starting a
business is stressful, we all know that, but did you know that small businesses
make up around half of all U.S. private-sector workers, and have generated 64%
of net new jobs over the past
15 years?
With new businesses popping up more and more, what are these current and new business owners doing to gain the capital backing they need?
The best thing
to remember is to get creative. Banks are not lending like they used to, and businesses still need help from time to time. It doesn’t matter if you are
starting your business, or are currently in business—finding alternative ways to get some cash for your business is something every business owner new and old
should know about.
Below are 5 alternative ways to get money for your current or new business.
- Business cash advance: Similar to a payday
advance, these types of loans are much quicker to get than
traditional bank loans. It is wise to note that these types of loans
are more expensive than traditional loans, but they are becoming
more popular. Business cash advances allow business owners to manage
their cash flow easier and is a viable way to get money fast, but
your company needs to accept credit cards in order to receive
- Factoring: Factoring can aid business
owners by “selling” unpaid invoices to a factoring company in
exchange for cash. Most factoring companies will buy your invoices
for anywhere from 70-90 percent of the value of your unpaid
invoices. After purchasing the unpaid invoice from you, the
factoring company will reach the customer who is responsible for the
unpaid invoice and collect the full amount owed.
- Grants: This is a good possibility, but
wise to remember many people are now looking at grants who weren’t
able to get bank loans. Many are finding this outlet harder to get,
but it is still is an applicable option. Instead of looking at the
federal level for grants, look to local authorities—this could be a
better option for some. If you are a non-profit, there are grants
specifically for you to look for as well.
- Venture Capital: Before contacting venture
capitalists about financially backing your business, you should
first draw up, or clean up your business plan. Have your goals
clearly stated, and back everything up with statistical data to
prove how you will be able to pay them back. There are groups out
there that are willing to invest, it’s your job to find them and
convince them you are worth their investment.
- Private Investors: A private investor is a
great way to get financial backing for small businesses. If your
business is geared toward a small niche audience, private investors
who are also passionate about the same topic are more willing to
give you a chance than a bank would. You can find private investors
in many ways. One way is to search online. There are many sites out
there to help you get connected with investors who are ready and
willing to invest. Sites like prosper.com and findinvestors.com are
just two of many. There are also agencies that can help you find a
private investor as well.
It doesn’t matter if you are
starting a business or need money for your current business, the main point here
is to remember banks are not your only option. Getting a little creative in your
search for a business loan can really pay off in the end, and it is wise to look
at many different options before committing to the one that is right for your
company.
Shannon Suetos is a writer based in
San Diego, California. She writes extensively for
Resource Nation,
an online resource that provides expert advice on purchasing decisions and a
comparison service for everything from a
debt management program
to
phone systems.
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