Starting out as a new business is full of challenges. You want to make sure you do it right so that your business can properly grow and thrive in the given market that you’re in. Sometimes, this is easier said than done. There are various lending requirements that can make the process tricky if you don’t have any existing financial information. However, that doesn’t mean that it is impossible. Mark Dicus & Company is here to talk about some of the different options you have for financing your small business.
How to Finance a Small Business
Since every new business is going to be different, there is no one answer for how you should finance yours. There are a few different options available to you, and it’s important that you understand each of them so that you can make an educated decision moving forward.
– Self-Funding: When you calculate all the expenses that will be needed to get your business up and running and the numbers are manageable, you might be able to fund your business on your own. This can work for those that have a decent amount of money in savings, a retirement account, help from friends and family, or even credit cards. There are some risks tied to this one as you may lose your savings or money that belongs to those you love.
– Crowdfunding: Sometimes, new business owners can grab the attention of others with their products. Creating a fan base can help you with crowdfunding as a way to finance your business. This involves finding people who are intrigued by your product that would be willing to donate money to get it up and going. This is usually ideal for those that have a physical product rather than a service they offer.
– Small Business Loan: To get a small business loan, you are going to have to gather some necessary information. Most financial institutions will want to see a business plan, value proposition, expense report, and financial projections for the next 5 years. You want to make sure you’re choosing the right bank to work with and apply with several banks and credit unions. This will help you determine who will give you the lowest interest rate and the best terms and conditions for your loan.
– Investors: You can also raise venture capital from investors. Investors will more than likely want to get to know your business before they are willing to invest money in it. You need to do networking to help gain contacts who are willing to connect you with the right investors.
Business Advisors & More in Salt Lake City, St. George, West Valley City, Provo, Orem, West Jordan & Greater Cedar City, Utah
If you are a new business and aren’t sure what direction you should go in getting your business up and running, you can turn to the consultants at Mark Dicus & Company to help. We have a team of new business advisors that can help you make the right decision for your particular circumstances. Call us today!