If you are wondering how to get money to start a business, you will find that there are many options available to entrepreneurs like you. This is especially true if you have great credit. But even if you do not, you will still find a plethora of options to help you follow your dream of owning your own business. This post will fill you in on how to get money to start a business, including some ways you may never have even thought of. Keep reading.
Family And Friends
Looking to figure out how to get money to start a business? This first option may not have even occurred to you. Sure, when you were young and looking for a couple bucks to go to the movies this was a great option, but now? Many people think that asking friends and family for money is embarrassing. Perhaps it is if you are just hard up for cash. But when you are looking to secure money to fund a business venture, it should not be embarrassing at all. Your friends and family are sure to be excited for your next big journey in life. And many will want to help you get started, especially if they see your enthusiasm for the idea. Your enthusiasm will be contagious. So make sure you have a sound business idea and get enthusiastic about your plans. Then, make the appeal to your family and friends. Even if you only get a thousand bucks, that is a thousand less that you will have to secure through loans or other funding.
Consider angel investors to be like family and friends that you do not know. Angel investors are individuals that will fund your venture with little or no interest. They may ask for a stake in the business or they may not. It all depends on the terms you are willing to agree to. When it comes to angel investments, you call the shots. However, unlike with friends and family, enthusiasm will not be enough to secure funding through this method. You will need to have a real, tangible business plan put together. For more information on business plans, check out our post on the topic. Put together a plan regarding what your business will do in the first year, at least. Make sure you have specific details. The more work you put into compiling a well-researched and organized business plan, the more likely you will be to secure funding through angel investors. If you are looking for how to get money to start a business, angel investors are one of your top choices.
This particular options is probably the first thing you think of when wondering how to get money to start a business. Business loans are a great option for individuals with great credit. However, if you do not have good, or any, personal credit, you probably thought this was not a viable option for you. You may be right if you are only searching for business loans for big-name banks. However, there are some loans available from the SBA, or Small Business Association, that may be worth researching. With these loans, you can secure up to $100,000 dollars for your business venture at very low-interest rates. All you have to do is apply. Unfortunately, these loans are hard to secure, however. As you can probably imagine, there is a lot of competition for this particular method. But it cannot hurt to try. And if you have good credit, you can fall back on a business loan from a big name bank like Chase or Citi. If you are wondering how to get money to start a business, consider business loans after looking for investments from other sources.
One last choice, for those with poor credit that cannot find investors willing to take a risk, is one of the many lending websites available online. These websites allow you to secure funds from other individuals at various interest rates. It is important to note that you will need some sort of credit to make use of these sites, and interest rates will be based on your credit rating. But if you are looking for a smaller amount of money, these sites can be the perfect way to secure it quickly, without having to put work into a well-developed business plan before doing so. This is not really an option for large chunks of money. But if you are only in need of a small sum to get your business off the ground, you may want to consider it. If you are trying to find out how to get money to start a business, there are much better options to try first but lending websites are a great last resort.
If you are wondering how to get money to start a business, consider the options listed above. Friends and family should be first on your list when looking for investments. Then, once you have exhausted everyone you know, try to wow an angel investor with an excellent, well thought out business plan. Depending on the amount of funding you need, consider business loans and lending websites when you have run out of possible investors. If you own your own business and have any suggestions for how to get money to start a business, please share your advice in the comments below. We would love to hear from you.
Photo from http://www.smesouthafrica.co.za/images/cache/cache_7/cache_a/cache_3/budget-savings-money-719e93a7.jpeg?ver=1467162580&aspectratio=1.5655526992288