How To Find Capital For A New Business

Starting a business can be a daunting task. There are so many things to do and think about before you even sit down to do a business plan. You need to get your thoughts together, figure out if this business model is the right one for you, and then assess your finances.



One of the most challenging things you will have to face when getting started is finding money for your business and what type of financing will be best. You can acquire funds from a variety of sources:

• Family and Friends – Any loans from family and friends should be put on paper and treated like it’s a regular loan with terms for repayment strictly outlined.


• Personal Savings – Using your personal savings is a standard option. You should treat this as a loan and make arrangements to pay yourself back.


• Microloans– These are loans established by the SBA to help small business owners in acquiring funds. Microloans can reach up to $50,000 at a maximum.


• Asset-based loans – These are loans based on your future assets and are distributed based on current receipts that are used as collateral. You want to find institutions that are willing to loan money to small companies.


• Bank-term loans – These are term loans and are usually immediate or long-term and are paid in monthly installments over time. Immediate term loans are generally less than a period of three years, but long term loans can be as long as 20 years.

Other types of financing are:

• SBA loans


• Private Loans


• Royalty Financing


• Angel Investors


• Government Venture Capital


• Grants


• 401(k) loans


• Credit cards

Keep in mind that loans are things you have to pay back, and credit cards can quickly put you in a situation that you cannot get out of. Getting loans from institutions usually require a sound business plan to show that you are serious and have a structure in place to generate enough capital to pay back the money you want to borrow.

These alternatives can help you in starting a business or getting a franchise, such as a self-storage franchise or other ventures. You can always put your ideas on places likeKickstarter and see how many people will support your idea. The beauty in looking for finances is that there are options everywhere. You may meet someone who will be willing to invest in your business model based on how you present it.

Make sure your pitch is solid and you are ready to deliver it at the drop of a hat. Joining organizations that can offer assistance and entering into small business competitions is also a great way to raise funds and gain publicity for your venture.

Assess the types of financing that would work best for you. Make sure you do your homework and read all the terms and conditions thoroughly so you will know what your obligations are. Although the road may be rough in the beginning, continue knocking on the doors. Someone will open one and you will be well on your way.

Tags: self-storage, finances, getting capital, small business tips