Starting a new business is an exciting and lucrative opportunity. There are many factors to consider, regardless of the entrepreneur’s economic situation. Securing funding to launch or sustain a new business is both a critical and sensitive step that requires careful planning; identifying the right type of funding specific to your business model and takes time and research.
Bootstrap funding is when an entrepreneur funds the business with very little capital. Most of the money raised comes from personal savings, credit cards, or other assets such as personal investments. As the sole beneficiary of this operation, the entrepreneur maintains total control of the business. There are no equity investors to pay. All proceeds remain with the entrepreneur.
Entrepreneurs can seek traditional funding from banks and other financial institutions to achieve business goals. Financing can range from debt financing, equity financing, to borrowing against retirement and insurance policies. Traditional lending processes are inherently strict and can work against the entrepreneur if the processes are not understood and followed correctly. Understanding the processes and procedures will maximize the chances of success. There are many free resources on the Small Business Administration website, the U.S. Business Advisor website, and at the U.S. Consumer Information Center. Entrepreneurs maintain total control of the business, equity, and proceeds. Continue reading “7 Ways to Fund your Business”