Fund your business creatively. When you’re starting a business, there are a lot of things to consider. One of the most important decisions you have to make is how to fund your business. Many options exist, but not all are right for every business. This blog post will explore five creative ways to support your business. We’ll discuss alternatives to a business loan, such as crowdfunding, angel investing, and bootstrapping. So whether you’re just starting or you’ve been in business for a while, read on for some great ideas on how to get the funding you need!
Don’t forget about loans. Not all loans are the same! A very creative one in Connecticut is the Connecticut Small Business Boost Fund. The program supports you before, during, and after the loan application process. Learn more by visiting CTSmallBusinessBoostFund.org.
Crowdfunding is a great way to get funding for your business without taking out a loan. There are a lot of different crowdfunding platforms out there, so you can choose one that’s right for your business. Check out Kickstarter or Indigogo. Make sure the platform you choose is passionate about the same subjects as you are. You can also choose between reward-based crowdfunding or equity crowdfunding. With reward-based crowdfunding, backers receive rewards in exchange for their donations. With equity crowdfunding, backers become shareholders and receive a portion of the company’s profits.
Angel investing is another great way to get funding for your business without taking out a loan. An angel investor provides capital to a startup or small business in exchange for ownership equity or convertible debt. Angel investors are often wealthy individuals interested in helping young companies grow. They can be a significant funding source for businesses turned down by traditional lenders.
Business grants are another great way to fund your business without taking out a loan. Several grants are available so that you can find one right for your business. The government and private organizations award grants, and they come in all shapes and sizes. The best way to find a grant for your business is to do some research online or consult a grant writer.
Microloans are an excellent option for businesses that need small amounts of money to get started. Microloans are typically loans of $5,000 or less, and they’re offered by various organizations, including banks, credit unions, and nonprofits. They’re an excellent option for businesses that can’t get a loan from a traditional lender, and they’re also a perfect way to build your credit history.
Bootstrapping is another option for funding your business without taking out a loan. Bootstrapping is the process of financing your business with your own money. This can include using your personal savings, selling equity in your company, or borrowing money from friends and family. Bootstrapping can be risky, but it can also be a great way to build your business from the ground up.”
Don’t knock the small business loans just yet.
Successful crowdfunding, angel investing, grant, microloan, or bootstrapping strategies can convince a lender to give you a business loan by demonstrating that there is interest in your business and that you have a solid growth plan. It can also show that you are capable of running a successful business. A lender will want to know that you can repay the loan, so it’s essential to have a solid business plan and financial projections.
Janet Johnson is a small business advisor and author of My Money Pivot: An Entrepreneur’s Guide to Finding & Making More Money and this educational blog. All views expressed belong solely to Ms. Johnson and do not represent the views of her employer. The website, MyMoneyPivot.com, is currently managed by Luz Marcos, Virtual Assistant.