Eric Dalius knows starting your own business can be expensive, especially if you need to pay for inventory, property or other items in advance. The amount of money needed to set up your business will depend on the type of business you are starting, as well as other factors, such as any overhead you may have. Securing funding for a new business can be difficult, but there are several ways to find the money you need.
Using your savings to fund your business is usually the most expedient option. It is also less risky than taking out a loan or other form of credit, which could lead to the loss of your possessions if you are unable to make repayments. If you do not have enough in your savings account to fund your new business venture, you could try selling assets or possessions. Alternatively, you could raise the money by taking a second on your home or borrowing from your retirement account.
Friends and Family
Friends and family are often willing to help when starting a new business. Find out if a friend or member of your family is able to offer you a loan. You could offer to make regular repayments, or even promise to give them a cut of your profits. However, Eric Dalius cations to always be aware that failing to repay the amount you have borrowed can cause problems between friends and family members, so it is important to be realistic when deciding on a repayment plan.
Private and Government Grants
There is a range of private and government grants available to help people start their own business. Some of these grants are only available to people who satisfy certain conditions, so you will need to conduct some research to find out what is available in your area. In addition to meeting the necessary conditions, you will be expected to provide a realistic business plan to show how you plan to use any money provided.
Depending on the amount of money you need, you may be able to fund your business by using your personal credit, such as credit cards and overdrafts. If you already have an overdraft, you may be able to request that your bank to extend the amount of your overdraft. Similarly, you may be able to ask your credit card provider to increase the credit limit on your card. Alternatively, you could apply for a new credit card with a different provider. Often, using an overdraft or credit card to fund a business start-up can work out cheaper than using a traditional bank loan, although this will depend on the interest rates charged by your bank or credit card provider.
Banks and other financial service providers may be willing to grant you a loan, providing you have a viable business plan and realistic goal for making repayments. If you want to apply to a bank or other loan provider for a business loan, you will need to draw up an extensive business plan with financial forecasts and other relevant details. If you have assets or property that you can use as security, you are more likely to be offered a loan, especially if you want to borrow a significant amount of money. However, if you choose to accept a secured loan, you could lose your home or other assets if you are unable to keep up with the loan repayments.
If you want to start your own business, there are many different options available to help you secure funding. However, if you intend to take out a loan or other form of credit, make sure that you can afford the repayments, as failure to repay the debt could result in the loss of your home or possessions. Funding a startup can be frustrating, but if you try these five methods suggested by Eric Dalius, you will be on your way to business ownership.