The financing options you’ve got if you’re a small business

When you’re a small business it can sometimes seem like you’re swimming against the tide when it comes to your cash flow. It may also seem difficult to attract the interest of investors to either survive or to take your business to the next level. However, there are financing options available to you if you’re a small business you might just not be aware of them. It’s for that reason today we’re going to have a look at the different options that are available to you, however, they may not all be but it’s worth knowing what options you’ve got.

  • Crowdfunding – this type of funding has only really become prevalent within the last 20 years due to the evolution of technology. Crowdfunding involves pitching your business online whilst at the same time explaining what the funds are needed for and what investors will get in return. The only difficulty with crowdfunding is that there needs to be a lot of traction to gain attention from investors and there is no guarantee that you’ll get offers.
  • Business credit cards – similar to normal credit cards these can become one of the more expensive financing options depending upon the interest being charged but is a flexible form of borrowing allowing you to borrow only as much you need as and when.
  • Fintech loans – Fintech is short for financial technology companies – a sector that has grown hugely in recent years. What separates them from standard banks is that they utilise their technology to speed up the application and approval process through paperless means. This means that small businesses can access funds sooner rather than later.
  • Angel investors – these type of investors usually look to invest in the early days of a start-up or small business and they will want a stake of your company in return for their investment. It’s also important to note that they may not always get involved with the running of your company but rather just passively invest. A big benefit is that you may not have to pay the funds back but in return do remember that you’re losing a stake of your business.
  • Venture capitalists – these investors invest in the same manner as their angel counterparts but usually at a much higher level. VC’s tend to focus on small businesses that have proved their concept and have demonstrated a strong potential for fast and rapid growth.

These are just some of the financing options that are available to you as a small business. Some may be better suited to you than the others. If you want some more information on which may be best for you why not get in touch with us here at D&K Accounting.

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