Business funding is one of the most significant issues facing small business owners today. There are many reasons not to take out a loan or invest in new technology. Still, without these fundamental pieces, your business will eventually fall apart. Fortunately, there are some other options for companies that need funding fast!
Business Funding Solutions You Should Know About
1. Venture Capitalist / Angel Investors
Angel investing is the next step up from business crowdfunding. Instead of hundreds or thousands of small investors, you need to find one or a few high-net-worth individuals who are willing to invest in your business. Getting an angel investor isn’t easy. It’s basically like getting venture capital funding through personal connections. You need to know the right people and be ready to sell them on your business plan and financial projections. These individuals usually don’t invest in just any company. They’re looking for startups that will provide an excellent return on their investment.
2. Business Grants
Business grants are investments made by state or national governments to grow small businesses and stimulate the economy. According to Lantern by SoFi, “Grants are lump sums awarded to a business or business owner that, unlike loans, do not have to be repaid.” If you’re looking for free money for small businesses, grants are your best option. Business grants are free money that you can use to launch a new company. You can also expand your current business or provide working capital for your small business.
3. Crowdfunding
Crowdfunding is when you reach out to many people for donations and ask them directly for funding. This is usually used by small businesses to raise $50,000 or less. Instead of relying on several investors for this amount of money, you ask the world at large through social media and online campaigns like Kickstarter.
4. Business Loans/Lines of Credit
Are you tired of having to rely on venture capitalists or angel investors? You can also turn to banks or credit unions for business loans. Business loans are investments you have to pay back over several years, usually with a fixed interest rate and monthly payments.
5. Reverse Split Loans /Reverse Biz Funding
Are your sales at a standstill? Not interested in using equity and previous dividends and residual payments? You can still use your company’s equity for funding by using a reverse split loan. Reverse split loans, also known as a Reverse Biz Loans, allow you to sell off part of your business in exchange for cash. It means that instead of selling off equity (which means selling a stock), you’re selling off debt.
If you’re not exactly sure which business funding solution is right for you, don’t be discouraged! There’s help available out there to guide you in the right direction. If you need assistance finding the perfect business funding solution for your company, don’t hesitate to contact a professional. They have years of experience in the business funding industry. They are more than happy to share that knowledge with you.
Business funding is vital for maintaining a successful business, even if it’s just for short-term projects or investments in new technology.
