Are you looking for different options for your business funding? It can be a minefield without a map. Here’s an idea of where you can start.
1. Business loan
Despite a fall in lending, the traditional business loan route is still a popular option for start-ups, and you have the advantage of retaining equity in your business. Take a look at this step-by-step guide on how to apply for a loan.
2. Small business grants
Not surprisingly, start-up business grants are highly sought-after, and hence difficult to come by. A really handy guide to these is here.
3. Bank Overdraft
For companies with fluctuating income, a bank overdraft can provide quick, flexible cashflow. The idea is simple: you dip into the overdraft in the leaner months, and come back out when the business picks up. This comes with it’s disadvantages, however. Most overdrafts are repayable on demand and interest rates can be above base rate.
Factoring can speed up cashflow and free up the time spent chasing bad debts as you sell your invoices to a factoring company so you recieve cash advances immediately. Costs are dependent on a number of variables, and these should be discussed when setting up the facility.
5. Angel Finance
Business angels provide business funding in return for equity in your business. This might not suit many business owners but it does come with benefits such as advice and experience that can help guide a growing business.
6. Asset Finance
An asset-based loan works in the same way as a mortgage. You borrow money against an existing asset of your business and if you fall behind on your repayments the asset is repossessed. Asset finance is good for businesses who are backed by assets but are yet to make a profit.
Any decision you make regarding the financing of your business should be well researched to ensure that it is the best solution for your business. Some more info can be found on this link