New Business Loans

By: EconomyWatch Content   Date: 23 December 2009

About The Author

EconomyWatch Content

Follow The Money

EconomyWatch, Content Team

 

  • Dot Div
  •      

Irrespective of how good your business plan is, you need a solid financing mechanism to grow and expand your business. This is where a new business loan comes into the picture, to solve your cash flow issues. There are various ways of financing your venture; therefore, it is very important to know what option works best for your business.

New Business Loans: Financing Options

Small Business Administration (SBA): The SBA was created in 1953 by the US Congress to assist millions of Americans to start their own ventures. SBA has offices throughout USA, and offers flexible guidelines for giving out loans to potential businessmen. You can secure SBA loans to either create a new business or upgrade your existing business. Regardless of intent, you need to create a proper Statement of Purpose document and present it to the SBA executives.

 

Most SBA loans require you to retain 10-20% of the equity in the business. Some require you to pledge your personal assets as collateral. You need a good credit record to secure an SBA loan along with a valid business plan and some capital.

 

Angel Investors: Angel investors are affluent individual investors or groups, who provide capital for a business start-up in exchange of convertible debt or ownership equity. Check out various investors before submitting a proposal. Some are interested in specific industries while others are more general. While some focus on start-ups, others look for companies with a good track record.

 

Venture Capital: To get a funding successfully from a VC group, start with a strong business plan and position your venture as a successful one. Perform a solid market research and back your data with statistics. A strong online presence and management team also helps.

 

Alternative financing: There are various alternative financing options available in the market for your business. If your small business falls under the category of businesses that promotes green technologies, there are ‘green banks’ that would provide you with the necessary capital. Also look at an IPO and business grants as alternative sources of funding.


  • Dot Div
  •      

Most Popular in Business Loans

Related Links
blog comments powered by Disqus