Has anyone discovered a good small business financing resource not associated with the SBA?
After starting a business, it's pretty easy to finance the first few years with credit cards... but then the interest rates starts to kill you! Crowd Funding does not lend itself well to my industry, so that is not an option. I just need a revolving credit line with a good interest rate.
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May 2, 2014
If one has either a history of company profitability and increasing cash flow OR a strong personal financial statement, getting capital is not a big problem.
May 2, 2014
Peer to peer funding (crowd funding).
May 4, 2014
Dave, do you know if this holds true if the company offers a product in exchange for the money? A lot of crowd funding sites suggest the business offer an item in exchange for the funds either as a pre-launch discount on the product or other items of a varying value dependent on the offering. If a product or service exchanges, then is it considered a gift?
May 2, 2014
there are options available if you are in business for longer then 2 years have over 700 credit score. you can use the equity in your business or patents or contracts and of course Purchase orders and receivables. i fix problems and this is one of the biggest for businesses
May 6, 2014
Dave, I am not sure I understand when you say you should never have to use your own personal credit for money for your business. Every bank loan I have seen for businesses under $20 million in revenue has a personal guarantee. All the trade credit I see extended to small business comes with a personal guarantee. CJ is running his business on credit cards so equity financing is not likely given his size. It would seem a bank credit line with a personal guarantee would afford him the lowest cost of money other than a home equity loan. Banks since the end of 2012 are back in the business of giving credit lines to business with 3+ years, predictable cash flow and good credit history.
So how do we avoid the personal guarantee when getting the next 30-50,000 for the business?
May 2, 2014
Hello CJ,
I am not sure what industry you are in however in the retail sector you can get the capital you need for a project through a merchant services cash advance. Depending on your processing volume you could qualify for up to $100,000 to use as a cash injection to the business. You then would pay the advance off with a small agreed to percent of the credit card sales you process. If this sounds like a viable option feel free to reach out to me. I wrote a blog post on the subject that can be viewed at: http://www.totalmerchantservices.pro/MerchantServices/MyBlog/CreditCardMerchantServicesCashAdvance.aspx
May 2, 2014
it depends where you are located and how much. Can you provide more details?
May 2, 2014
Capital one has very good different programs for small businesses. Check it out here:
http://www.capitalone.com/business-credit-cards/
That's very interesting Dave - thanks for the info. I have been thinking of using one of these for a project I have planned, but it would have been for a for-profit entity. I know a couple of people that have used KickStarter to fund independent albums and I'm sure they didn't read the fine print regarding the taxes. I will certainly do more research on this for my projects and will forward this info to my musician friends.