Getting More Finances for a Business
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Despite the slow economic growth over the past few months, entrepreneurs still have plenty of ways to raise capital for their new business ventures. There are now more than 20 sources of funding available to entrepreneurs, including internet funding sources. However, it is still the traditional sources that fund the majority of new businesses.

The Small Business Administration is one of the largest sources of business capital for a small company. Their primary goal is to encourage the economy of the United States by providing a wealth of resources for small business owners. Though they do not directly provide funding to any small business, they do work in collaboration with local banks that make small business funding possible. The advantage of applying for this type of funding is its quick approval process. Prospective borrowers are often notified of their loan status within 36 hours of applying for an SBA loan.

Bank loans
Community banks are also great sources of small business capital. Some decisive measures for bank loan consideration are the borrower’s credit history, collateral to secure the loan, financial prospects, and a well-devised business plan. The advantage of approaching a bank for a small business loan is that an entrepreneur may have a good chance of obtaining capital if they have established a good relationship with a bank and/or its lenders in the past.

Microloans (microcredit)
For those applicants who do not have stellar credit or collateral to secure traditional commercial bank loans, microloans may be an option to consider. Banks and other financial institutions often provide small lines of credit (microcredit) to individuals who do not meet the standard requirements of traditional banks since they are considered poor entrepreneurs who are not “bankable.” While microloans may not cover all startup costs, it still provides a great source of partial funding for new business ventures. Microloans typically range in size from hundreds of dollars to the low six figures. In fact, over the past few years, more entrepreneurs are turning to micro loans as a source of funding.

Venture leasing
Venture leasing, a trend that has been around for the past decade, has become increasingly popular among fast-growth companies. This source of business capital is generally available to entrepreneurs who have already been granted institutional funds for their startup. When an entrepreneur decides to use venture leasing, s/he is simply financing startup equipment and other technologies from equipment leasing firms owned by venture capitalists. Venture leasing is not a cheap alternative for financing. Deals typically require payments of 100% of the principal, plus 8 to 12% in interest over a 24-month to 60-month lease horizon.

Credit cards
Credit cards have always been the mainstay of the small business owner. A lot more entrepreneurs are relying on their credit cards to finance their new businesses. Credit card amounts cannot simply provide the funding required for most startups; however, multiple sources of funding, including credit cards, can accomplish this goal. There is a lot of risk involved when using credit cards as the main source of funding since interest rates are high and non-payment can lead to poor credit or no credit. Before applying for a credit card, the entrepreneur needs to make sure they know the interest rates, monthly payment plans, confidentiality agreement as well as additional fees that may be added.

Friends and family
Finally, family members and friends are great sources for obtaining capital for a new business. Often times, they are enthusiastic about an entrepreneur's new venture and can give money immediately without the high interest rates of more traditional lenders. One problem with the informal borrowing of money is that it can lead to relationship conflicts. In order to prevent such events from occurring, the entrepreneur needs to set rules with family and friends whom s/he has borrowed from and vow to pay back all owed debt as soon as possible.

There are many ways in which an entrepreneur can go about finding the money needed for his/her new business. They can apply for SBA loan programs, obtain a commercial small business bank loan, or if they do not have solid credit, can opt for microloans. To obtain equipment and technologies for their new company, they can resort to leasing their equipment from venture capitalist leasing firms. They can also boot strap their finances as a way to raise capital by using their credit cards as a source of funding. Business owners can also ask for financial support from family and friends, who are often willing to help out a loved one.

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