What Most Business Owners Dont Know But Need to About Business Financing
It is amazing that only a small percentage of business owners are aware of all of the Business Financing options that are available to them. There are at least a couple of dozen different Business Financing options.
Too many business owners only think in terms of going to the bank for a Business Loan. Even in this category there are numerous variations. Some of these variations include:
Working capital loans
Revolving loans such as Business Line of Credit
Balance sheet Loans
There are other cash flow solutions other than taking out a loan which adds debt to the balance sheet and uses up valuable credit facilities. Some of these include:
Account Receivable Financing, such as Factoring
Purchase Order Financing
Some other Business Finance options are:
Business Credit Card
Scientific Research & Tax Credit Financing
Above is only a partial list of available funding vehicles available to help companies grow their business.
There are also loans that are more risky and where a larger percentage of the amount is needed. These types usually require Venture Capitalists or Angel investors to get involved. These types of loans are extremely difficult to obtain because only about 2 out of every 10 deals that are approved end up being successful. It can also take from 100 to 500 deals for the investors to find the 10 to invest in.
Unfortunately the big banks do not offer all of the different options that are available. Some sources of funding are difficult to locate. It is always beneficial to obtain expert advice as to which type of funding best fits your situation. Trying to do it yourself can end up costing you more than it would to hire a professional. Your time is best spent working on your business. Business Finance Consultants, Business Loan Brokers and Business Finance Coaches can all assist you in determining the best type of funding for you. They can also assist you in obtaining the financing. It is better and more cost effective to hire an expert than to waste time and get the wrong financing.
For more information on Business Financing options contact:
Ray Ellis, BFC
AAray Financial Group
This is first of a series of articles that will explain in more detail the different types of Business Finance Options that are available. I hope that you found it informative and will read the remaining articles in the series as they become available.
Have a question for Ray? Ask or leave a comment below!