Table of Content

Tuesday, April 28, 2009

Financing Your Small Bussiness

If Bussiness is your body, so finance is your blood, where's it coming from?

  • Bank loan - This is called debt financing where the bank gives you a loan and charges interest on it. They also provide you with a re-payment schedule. For your loan application with the bank to be successful, you must have a good credit history and a sound business plan.
  • Grants - Many small businesses are able to get grants from government or private institutions that have been established to encourage growth of small businesses.
  • Venture Capital - If you have a high growth company and plan to become big in the future, then you can approach the professional Venture Capitalists to invest in your business.
    Another option to fund a small startup business is to approach your rich relatives. This has been a good option for many family run businesses across the world.

Getting a Small Business Loan

To be successful with a loan application, you must satisfy your lender's (for example, Bank) requirements. The lender will see your business plan and decide if the loan amount asked for is suitable. He will want to know how you plan to pay back the loan. You may need to provide some form of security against the loan. He will want to see your accounting financial statements. By keeping these things in mind, you will be better prepared for the loan application interview with the lender.

No comments:

Post a Comment