Growing Your Business

Finding Capital for Your Business: Traditional or Unconventional?

by
Julie Farless
on
2/21/2016
Finding Capital for Your Business: Traditional or Unconventional?

As a business owner, acquiring capital to keep your company running or finding the money to expand can be a major obstacle. Although most people think of acquiring capital as going to a bank and getting a loan, there are a number of instances where there may be additional challenges. If you are a brand new business, you may not qualify for the amount of money you need, and that could pose a serious problem.

This is the traditional way of thinking, but there are other alternatives that are a little unconventional, but could help you get what you need:

Kickstarter

You may have heard of Kickstarter and wondered how or why people would publicize their business model for investors. Well, it works. If your business idea has any footing, you may be pleasantly surprised at the number of people willing to take a chance on you.

Angel Investor

Angel investors are very popular and can help you go from 0 to 100 very fast. Before taking this route, you must assess your business model and determine how much of your company you are willing to give up to acquire the capital you need. Although the cash infusion may be from an angel, nothing is free.

Friends and Family

This is where the rubber meets the road. Although friends and family may be congratulating you on starting a business and often give you encouragement, you find out what they really think of your business model when you ask them for seed money. Turning to those who mean the most to you can work very well – if they open their wallets.

Private Lenders

There are a number of private lenders available for business loans. These may be high-interest loans, but they get you the capital what you need, often without all the red tape involved when working with a bank. For many, this has been a viable option that has had amazing results.

Grants

A number of cities have small business grants that provide funds to acquire equipment and other items you need to keep your business afloat. There are also neighborhood block development grants that offer more money, but the process is tedious and they go through everything with a fine-tooth comb.

Competitions

Many large newspapers strike up a collaboration with local universities for small business competitions. This not only gives you capital, but provides visibility for your company and what you do. 

These are just a few options that are available to you; they can be unconventional, but work. There’s nothing wrong with the traditional way of doing things, but as a business owner, you must be willing to take risks and put it all on the line to get ahead. Drive and passion are important elements, but developing a “hustle” mentality can take you very far.

Being a business owner can be frustrating, but is always a learning process. Knowing where to go to keep things afloat before you need to is proactive and strategic thinking – the fabric of a great entrepreneur.

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Julie Farless

Julie Farless

Martinez & Shanken, PLLC is a Certified Public Accountant (CPA) firm based in Gilbert, Arizona. We provide a full range of accounting, bookkeeping, consulting, outsourcing and business services, but we specialize in tax preparation. We work with you to ensure that your personal or business processes are conducted in a manner that ensures ongoing integrity in your financial transactions. We are available to answer your questions and help with your ongoing tax planning and changing business needs.

Deborah Martinez & Earl Shanken
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Arizona

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