You have got a unique and innovative business idea, but are lacking funds to get the idea rolling, don’t worry there are plenty of aspiring entrepreneurs like you who struggle to make their business dream come alive. Well, you need not necessarily be amongst those who struggle, instead, you can be brave, bold and venture out to kick-start your business dreams provided you know the right ways to obtain funds for your start-up business. Today, there are plenty of fund options available in the market, you only have to look at the right places. If you have just started your business or if you have been running a business for a while, but are struggling to get ahead with it, then getting funds from the following sources, will greatly help you in your business endeavor:
Applying for a business loan from either a bank or any other private lending institution, today, there are plenty of lenders who are willing to offer funds to several small and medium sized business organizations. While applying for a loan, it is best advised to prepare a detailed proposal that explains to the lender your business idea and convinces him that it is indeed a potentially profitable venture. Just make sure that you do your research about the different MSME finance lenders in the market and choose the one that offers funds at an affordable interest rate.
If you are already running a business and are looking for funds to meet your immediate expenses, like buying a machinery or getting a short-term capital, then microloan program would be your ideal choice. However, you need to know that, for microloans, you need to provide some kind of collateral. If you are applying for microloan for buying any equipment, you can use the same for the collateral.
This is another popular way to get funds for all small and medium-sized business organizations. The best time to look for angel investors is when you wish to expand your business operations or you have reached a breakeven point. Either way, the Angel investors can pump the required funds to accomplish your business goals. However, you do need to know that getting funds from the investors would imply that you would have to give the investors a certain percentage of stake in your business. This means the investors would also have a say in the business operations and decision-making.
If you are using credit cards, you can put it to good use to obtain funds for your business and meet your immediate expenses. However, it is advisable that you use this method as the last resort as the interest rate on credit card, as the cash advances are pretty high. And if you are not careful with your repayments, the debts can increase tremendously in quick-time, which in turn can affect your business.
Borrow funds from friends or family
There is no better way than borrowing funds from friends and family, however, make sure that you repay the money in time to avoid ruining your friendship or spoiling your relationship with the family members. The best way to handle loan from friends is to handle it as professionally as you would deal with a bank or a lending organization. Also, make sure that you have a formal agreement with the lender and list down all the details like the loan amount, the interest rate, mode of repayment, loan duration etc.