Sources Of Funding For Small Businesses
The question of funding for small businesses can be a struggle for any small business owner. As rewarding as this can be, running your own business carries constant challenges, from maintaining staff to financial struggles to making sure you are providing the services your clientele want. It’s easy to get swamped in some of the day-to-day functions of business, but you also have a responsibility to keep your business financially healthy. To do so, outside funding is often essential. The question is though, where do you begin?
What Options Do I Have For Funding My Business
The good news is that there are lots of different lenders out there that provide funding for small businesses. However, this can be a bit overwhelming at first. To help break this down, let’s look at two main categories:
Traditional Funding Sources
- Government resources
- Private lenders
Many will recommend small business loans for banks, and there are good reasons why. Small businesses are likely to get low interest rates, which is crucial. However, the fact of the matter is that increased regulation is causing banks to hold back on their small business loan offerings. Private lenders and government resources can be valuable as well, but don’t be surprised if there are specific requirements that you will have in order to get funding. Generally, if your business is just starting out, it can be hard for you to find funding.
- Peer-to-peer lending
- Crowd funding
- Merchant Cash Advances
If you have trouble getting funding, these may be better sources. In general, there is less of a barrier to entry, but there may also be other issues, such as higher interest rates or lower amounts of money being available. In some cases, like crowd funding, there is no guarantee at all how much funding you will get. Before looking at options for your funding for small businesses, it’s important that you evaluate your business.
Questions to Ask Before Choosing a Lending Method
- Why do you need the money? Are you looking to fund payroll? New equipment? Maybe a new business?
- Banks are going to want to see the whole picture. You should be prepared with all your business information.
- Who is taking on this loan? Depending on the type of business you may be personally responsible for the debt. This means a bank can hold your personal assets as collateral if the company doesn’t pay.
- What does the management team look like for the company?
- Traditional companies want to know who they are lending too. It makes a difference and banks will check the credit history of those people listed. A background check may also be completed.
- How fast do you need the money? Non-traditional lenders have shorter turn around time frames. There is also currently less regulation in the space. However, with less regulation comes increased risk to the lenders. This risk is mitigated in the form of higher interest rates.
- In most cases when you apply for a bank loan you are required to submit a business plan. As well as your financials from the last several years. If you are looking for reoccurring funding a traditional loan may not be appropriate. You may want to consider another alternative. You can also talk to your bank about a line-of-credit.
Using Merchant Cash Advances
eBusiness Funding provides alternatives to traditional small business loans. By working with us, you can get funding for small businesses quick, with minimal roadblocks If you meet our minimum requirements, you can be approved and funded in a matter of days. The benefits of choosing eBusiness Funding include:
- No upfront costs.
- No application fees.
- Up to a $500,000 cash advance, based on your current financial strength.
- Cash in hand as soon as 72 hours.
- 90% of applicants who meet our requirements get approved.
Get started with eBusiness Funding for the funding your small business needs with more accessibility and speed than many of the options out there. Fill out the simple contact form on this page now and get the financial support your business needs.