Articles

Business Bank Loan

One of the most obvious methods to small business funding is a business bank loan, however in the real world these can be difficult to be accepted for unless you have assets to speak of, or you are willing to put up personal guarantees to cover the debt if the business were to go out of business before the loan had been paid off.

Starting with your own bank can be a good strategy, your current bank will be in a good position to merit you for your good standing and trading history. Even if your bank offers you a favorable rate it pays not to over look other lenders.

Factoring

Factoring is a way of raising quick finance at low cost. It is ideal for business with steady sales in the b2b market space. Factoring companies will provide business funding based on the totals of your outstanding invoices. This is a viable route if you operate with high margins to justify the associated fees.

Charge Cards, Credit Cards or an Overdraft

If you are looking to cover unexpected purchase and expenses then credit cards can work. For a new company with low initial launch costs credit cards can be a effective option. There are many interest free rates available so it can be a simple and efficient source of business funding. An overdraft facility is another option, however this is an unstable form of finance as the bank can remove the overdraft facility at any time.

Equipment Leasing

If you require business funding for the capital outlay for machinery or expensive equipment then leasing could be a safe bet. Leasing spreads the cost of owning important business equipment over a period of time allowing the operation to grow pretty quickly.

Outside Investment/Equity Finance

Seeking business funding by releasing equity shares in your business can be highly beneficial as outside investors, such as Business Angels can add experience and knowledge to your business as well as the funding you need. This form of finance also carries less risk to your possessions as you will not typically need to provide any personal security to cover the funding needed.

An effective way to attract investors to your business is to register with Edge Venture and record an elevator pitch, this will present your business funding opportunity to many investors at once.