We all know that raising money to finance a business start-up is a challenge. In today's recession, it is nearly impossible. However, below I've listed "4 Tips to Get Your Business Growing!"
1. Borrow from family & friends
- Loans from family and friends is a great way to finance a start-up. Getting these private business loans are a win win situation. Often, they have an interest rate that's 2 percent to 3 percent lower than the market rate (which benefits you) and 1 percent to 2 percent higher than the high yield savings rate (which benefits them). Banks today are charging more for loans to you and paying lower interest to depositors.
2. Borrow from yourself
- Many entrepreneurs rely on their own savings for about 30-40 percent of their initial start-up funding. Make a budget and stick to it. Once your business generates enough revenue, pay yourself back.
3. Borrow online
- There are many web based small-business financing alternatives. OnDeckCapital is an online lender that looks at your cash flow instead of your credit score and tax returns. They collect small daily debits instead of larger monthly installments. Check out Merchant Cash Group. They offer business cash advances, which can provide you with the working capital you need to keep your business operating. There are many web based lenders to choose. Do a BBB (better business bureau) check on each one and decide which will benefit you and your business. Do your research!
4. Borrow from patient people
- Think twice before taking a debt that needs to be repaid immediately. In a start-up, it is difficult to forecast the revenue. Therefore, short term loans are risky during these uncertain times. Within your business network, find supporters that are willing to provide a grace period on repayment.
A business start-up during a recession is a good idea but recognize it will take extra effort in your part to raise money in the months head. Please be prepared and ready to work hard to achieve and enjoy all the fruits of your labor.
Best of luck in your business endeavors!
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About the author: Sonia Colon is writer/publisher of My Fashion E-Mall Blog & The Biz Buzz of a Latina Mom Blog. For additional powerful business articles and Internet marketing tips for maintaining a lucrative business visit her sites today!
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