10 Ways to Get the Money You Need to Start Your Small Business
Every business needs money to thrive.• But if you are just starting out, where do you get the money to start your business?• This question becomes even more important if it takes tens of thousands of dollars to setup your business.
Anywhere• The simple answer to where do you find the money to start your business is: anywhere you can.• Here are ten ways you can find the money you need to get your small business off the ground.
#1: Take It Out of Savings• The easiest and simplest way to get the money you need to start a business is from your own bank account. – Unfortunately, not many people have money in their bank accounts.• If you are one of the many people with no cash to start a business, do not give up hope. – There are still nine other ways to go.
#2: Ask Your Family and Friends• Depending on how well you get on with your friends and family, you may be able to borrow funds from the significant people in your life. – What’s more, you may be able to borrow at significantly better terms than you would if you got a loan from a bank. – Because the balance of power is a little more equal in the relationship between you and your friend or family members (vs. a loan officer) you can work out a way to make sure you can keep up with the payments. • For example, you could have an interest free period at the start of the loan if you know you will not have revenue coming into the business for the first six months.
#2: Ask Your Family and Friends• But beware. – Mixing friends or family with money can be dangerous. – You might wind up permanently damaging your relationship with that person. – At the very least, write out your agreement with the person so that it is clear what is expected of each party.
#3: Ask a Bank for Money• Banks are another helpful, although intimidating, option. – And just because “the economy is hurting” or “money is tight right now” does not mean you can’t get a loan.• You do have to make a very good case as to why the bank should lend you money, though. – While there are plenty of guides on how to do that, I would suggest simply asking for the money.
#3: Ask a Bank for Money• If and when the bank turns you down, ask them why. – Then listen and learn from what the loan officer says. – You will learn faster then if you read 10 books on the subject of getting a loan from a bank.
#4: Apply for a SBA Loans• The Small Business Administration also has several loan programs that it or its affiliates offer to people in business or wishing to start a business.• There are three main types of loans: – 7(a) loans – Mirco-loans – CDC / 504 loans• Each of these loans comes with a long set of stipulations, but if you qualify for any of the three you may find it easy to get the money you need to start your new small business or expand your current small business.
#5: Get a Loan Online ThroughKabbage, Prosper, LendingClub, or Zopa• Kabbage.com, Prosper.com, LendingClub.com and Zopa.com all lend money to people over the internet. – These sites get investors to put up small sums of money which over the thousands of people that invest add up to a lot of cash. – Borrowers then post a loan request on one of the above sites and wait for investors to fund their request.• This is a great way to fund your business, assuming you need less then $15,000.
#6: Sell Your Possessions on eBay, Craigslist, or Etsy• Every one has unused or unwanted items laying around their house. – Why not sell some of these items to make the extra cash you need? – That way you don’t have to pay interest on the money you receive and there are no strings attached to what you could do with the money.• While you could start a online business selling things on eBay, Craigslist, or Etsy, if that is not what your business idea is, you probably shouldn’t do it.
#7: Ask Your Boss for An Advance on Your Salary• If you are on good terms with your boss, you could ask him for an advance on your salary.• This option assumes you can live without the money your boss gives you because the advance will be deducted out of your paycheck at the end of the month.
#8: Partner With Someone Who Has Money• If you don’t have money, why not find someone who does? – There are plenty of people who would love for you to do the grunt work while they sit back and let there money grow in a new venture. – You will have to split your profits with your partner, but if you are very successful, you could always buy back your partner’s share of the business.
#9: Defer Expenses or Trade Services• If you only need a couple hundred to a thousand dollars, you could defer major expenses until your small business has some income.• You could also trade your services for the services of others. – For example, let’s say you wanted to start a lawn mowing business. – You could mow your accountant’s lawn in exchange for your accountant doing your books.
#10: Collect Recycled Materials For Extra Cash• If you have no other way of getting the money you need to start your business, you could always collect recyclable materials such as aluminum cans or copper wiring.• Ask your friends and family to help you collect anything they find while going about their day. – You’d be surprised at how many cans people throw away and how much you can get for them.