Are you struggling to figure out how to get your new business off the ground with little to no money to invest in it from the start? If so, you can join the 43% of small business owners who have found it difficult to find ample financing for their businesses. But, just because it’s tough doesn’t mean it’s impossible. Some of the best ways to raise capital to get your new business moving are also some of the simplest ways that can keep your business afloat for years to come.
Use Your Own Available Resources
Most people forget that some of the things they already own are their best resources for finding money to fund their businesses. For example, title loans in Memphis can give you quick, temporary financing for your business by letting you borrow some money against your vehicle. You can often take loans out against your home equity, too, if you have enough invested in it.
Think about the assets you currently have, from retirement accounts to life insurance. These are all possible resources for borrowing some money when you’re in a pinch. Just be sure to put everything you borrowed back into them, plus interest, as soon as you start making money from your business.
Bootstrap Your Business
Bootstrapping a business isn’t possible for everyone, but if it’s possible for you, you shouldn’t balk at the idea. When you bootstrap, you find the most frugal ways to do everything so that you’re left with little to no debt later, giving you the most profit possible.
Bootstrapping is all about being creative when starting your business. This is a good idea, especially, for anyone starting a digital business. Instead of purchasing a building for your business, rent some coworking space and a small storage unit until you start making money and can afford to pay for a building without a loan. And, make sure you negotiate everything, including any products or services you need to get started.
Look for an Angel Investor
Angel investors can be incredibly helpful for startups looking to grow and expand their businesses. These investors have a lot of money ready to finance a business, usually in exchange for part-ownership. If you don’t mind giving away part of your business’ ownership, you may find that an angel investor will pay for all of your startup costs, and then some.
You might be able to work out a different deal with an investor that doesn’t require any ownership, like paying back the investment, plus interest, within a certain timeframe, or allowing the investor to receive a percentage of sales for the first year or two. Just be sure to have a solid contract that outlines all the details.
Get a Line of Business Credit
If you absolutely need some extra cash to get your business moving upwards, consider opening a line of credit for your business. Use your credit line only when absolutely necessary, and try to not carry a balance if you can help it.
Spend plenty of time researching your available options by comparing credit line offers, interest rates, application fees, annual fees, and more. Once you have credit established, you need to be responsible with it by making timely monthly payments to ensure that your business starts off with an excellent credit history.
Opt for Working Capital Loans
Working capital loans may be an even better option for your business than traditional loans when it’s still in its early stages. Working capital can help you pay for short-term problems, like business emergencies that arise, and are usually much quicker to obtain than regular loans.
These loans usually are offered to you based on your business profits, so they aren’t typically more than you can afford. Your payments will come right out of your profits, making the whole process automated and customizable to your business and its growth.