5 Financing Options For Small Business

As a small business owner, you already know that there’s practically an infinite number of things to do while building or running a business. From maintaining daily operations to building long term business relationships, there’s always something to do. And in some cases, you’re going to have to put up some cash to make things happen. That’s just how the business world works.

But you might not be sure how to go about funding various business ventures, both big and small. Every business owner goes through those stages at some point (and multiple times) throughout their business.

That’s where small business startup loans come up. There are a lot of ways to get additional funding for your business, and I’ll go over a few viable options for you today.

1. Small Business Administration (SBA) Loans

The Small Business Administration is a great place to start, which focuses on providing additional funding for a wide variety of business ventures. The SBA provides a myriad of different funding options to accommodate different industries, different types of businesses, and different utilizations of funding. For example, some SBA funds can be used to provide working capital for your business, to purchase or upgrade necessary operational equipment, on real estate, and much more.

A small business startup loan from the SBA is a great place to start, especially if you can afford to wait a number of months for the approval process. Popular SBA loans include the 7(a), 504, and Microloan.

2. Small Business Investments from Family/Friends

Especially common for very small startups, getting outside funding from friends and family is sometimes the only solution at the beginning. I would never recommend going into an investment with a friend or family member without having some kind of outside counsel and agreement established. This will help you to avoid any financial issues (like poor record keeping and failing to send timely repayments) that could tarnish a relationship.

3. Small Business Equipment Leasing

If you’re business needs to get funding primarily for purchasing equipment (e.g., companies that are in healthcare, construction, technology, etc.), you can get small business loans for startups that are designed specifically for various types of business equipment. Leasing the equipment is a great alternative, allowing you to use the equipment or vehicle while you make payments to own it at the end of the agreement.

4. Crowdfunding for Small Businesses

If you’re starting up a new business that could positively impact a lot of people, creating a crowdfunding project could be a great option for you. This allows people to advertise their business online and get funding in advance, often times before you have a product or service complete. This funding allows you to develop the infrastructure, products and services necessary to serve your new customer base.

5. Using Credit Cards

If you already have credit cards, then you can skip the entire “qualification” process and use them as a substitute for loans for small business startup. Remember to watch your balances closely and always pay off your card statements.

These are just a few options you can pursue to finance your small business or startup. Regardless of what your financial situation is like, there is typically a solution for you if you know where to look.