Financing a New Business
After spending an immense amount of time trying to materialize your business idea and cleaning up all the rough edges, the biggest task comes when you have to get financing to get the idea off the ground and make it start running. For most people, this is where their ambitions come to a sudden screech and all their dreams are squashed. However, being furnished with the right information on the different avenues that you can use to get funding for your business you can manage to skip the hurdle and make headway to the finish line.
One of the most common ways to get a business up and running is by taking a loan. The process may have gotten quite strict but there are a variety of banks like Bank of America and J.P Morgan that have packages that accommodate new businesses that you may find quite attractive.
Alternatively, if you’re unemployed and are hoping that your master business plan is what will give you that much needed break through, then you can also get the business finance assistance from the funds that you could have saved in your 401(K) account. Thankfully, the tax code does allow one to use the funds but only if they follow the required procedure and do it right. The best thing about this is that you don’t have to worry about high interest rates and all that banking jargon.
Are you feeling confident about the potential of your business? Well, to get it off the ground another option that one could use is the angel investor. This is a successful business person that is more than willing to invest in young and highly potential businesses. The advantage with this mode of business finance is that the money that the angel investor offers is not a loan. Rather it is an equity investment which means that the mount buys the investor a stake at your company. However, you should ensure that you read the fine print properly to make sure that you’re not taken advantage of. To get an angel investor, you could talk to your friends and relatives who are bankers, lawyers or even accountants since they deal with the wealthy people. They may give you some much needed insight and more importantly vital contacts.
As a last resort, you could decide to indulge your friends and family. These are people that believe in you and they understand your potential. You might have to do quite a bit of pitching but they could be very helpful. Sites like Kickstarter.com have also become very useful in ventures of raising capital for businesses.
Once you have gotten your business of the ground, you have to have a marketing strategy in place if the business is going to see the light of day. You have to be smart and aggressive in your marketing strategy for this to work and if you are, then it is safe to say that you will make it safely out of the woods.