In a perfect world, people who wanted to start small businesses would call up their bank and quickly be issued funds. But that’s not the world many of us live in. Because of poor credit, lack of credit history, low income, high debt, or any number of other factors, it can be difficult to secure the kind of financing necessary to make a new small business thrive. Fortunately there are a number of untraditional ways to get the money you need. These might require some hard work and out-of-the-box thinking, but they will help you achieve your goals.
Non-traditional Lenders. Getting people and entities to lend you money is an art. Most people have never asked for a loan before. Even if you have secured financing from a bank or a dealer in the past, you probably don’t understand the full scope of the lending industry. Here is an example of an internet-based lender who caters specifically to individuals and small businesses: https://www.merchantmoney.co.uk/small-business-loans/.
With a lender like this, you’ll be much more likely to be given the money you need. Large banks are beholden to shareholders. They don’t need to give you money, because they have so many different income channels. Smaller lenders like one linked above are subject to a greater degree of market competition than larger lenders. By shopping around, you may be able to find one that’ll offer you an incredible deal.
Local Nonprofit Financing. You may be surprised to know that there are many nonprofits and other entities which finance small businesses. These groups do what they do to improve the market health and living standards of their town, city, or region. Most of the loans are issued in the form of grants, though microlending organizations may operate more like traditional financial entities. Take a look at what is available in your area, and talk to some local small business owners to see if they have any leads. Being able to acquire financing outside of the traditional lending sphere is a great privilege, one which you should definitely not pass up.
Personal Credit/Savings. While it is generally advisable to keep your personal and business finances separate, there are certain situations that warrant using personal credit or savings. If you have a product or service that already has buyers/customers, it is important that you bring your operation to scale as quickly as possible. Calculated risks can make using your personal credit or savings a good bet. Only do this if you are confident that the investment will pay off quickly enough to keep your personal finances from being compromised.
There are many more ways to secure financing for your small business endeavor. Talk to your family about a loan. Work extra hours at a side hustle and put all of the extra money into a savings account meant to build your business. You can probably think of some of your own ideas. Keep at it and you will have the money you need in no time.
