4 business financing options for your start-up business
An article from guest blog writer, Matt Press, Splash Copywriters, looking at business financing options for your start up business.
Starting your own business can be both exciting and daunting at the same time but without sufficient funding it will never really get off the ground. So where do you go to secure finance in the first place.
Well, we’ve got some great business financing options right here that should be able to help you to at least make up a shortlist of potential sources to fund your start-up business.
Business Financing Option 1 – equity investment
In terms of a business, equity investment is a term used to describe buying and selling shares in that company. If you find someone who has the funds and is interested in owning part of your company, then this could be a viable option. Just remember that if they own 51 percent or more of your business, they will effectively be in control thereafter.
Business Financing Option 2 – Government funding
At the time of writing this article, there exists several government funding options available to start-up companies. Some of these will need to paid back whilst others may be in the form of a grant. In order to qualify for these you will need to undergo some form of scrutiny from the lending source. You will need a decent business plan at the very least before qualifying for such an option.
Business Financing Option 3 – Commercial loans
Perhaps your current bank will be able to offer you a commercial loan or maybe a specialist lender. Short term loans usually offer a lower interest rate whilst long term options will need to be secured against your assets. Both of these will require you to present a feasible business plan on application.
Business Financing Option 4 – Personal savings
If your start-up business doesn’t require too much in the way of outlay, perhaps your personal savings could be an option?
If you plan to work from home and only need some basic equipment, it may be better to use some of your own money before applying for a loan. Even if you can’t cover the whole amount with your own savings, this will at least encourage lenders to help you out at some point. It’s a good idea to front up at least 25% investment because that will increase your own equity stake in the business and lenders usually loan up to three times your equity as a rule.
Always keep a record of your income and try to ensure that your personal and business credit rating scores are a high as possible.
I wish you every success in planning out your business finance for your home business and to learn more about financing your business in today’s world > Click Here <
Mark Ford, Home Business Coach, Entrepreneur, Digital Marketer & Information Publishing.
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