Owners of start-up businesses often complain that it’s extremely hard to get financing. That’s partially true, even in the modern world of crowdfunded everything, alternative lending institutions and other non-traditional avenues for start-up funds. Some owners find it nearly impossible to get that first bit of seed money that can make all the difference. The vast majority of successful businesses went through several “mission statement” changes in their early years. A lot of that has to do with owners who change direction as they meet funding obstacles along the way. Lenders want to know their money is safe and will produce a return. As long as an owner can demonstrate the credibility of a sound, workable business idea, funding will eventually be within reach.


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Banking industry professionals often cite four things that owners of new businesses should consider when funds are lacking and a traditional loan is out of the question. Here are four ways for owners of micro-start-ups to get funding, or at least make themselves more attractive to banks and other lending institutions.

Seek Personal Funding Sources

It’s almost too obvious, but many owners of start-ups overlook personal funding resources. If new owners are willing to “go all out” for a business idea, then it only makes sense that they’ll sell some of their personal assets (second car, boat, motor home, coin collection, and art work, for example) to bring in much-needed capital. When approaching a traditional lender, owners can up their chances of getting loans if they can show that they’ve exhausted every personal funding avenue available to them. In addition to selling off excess assets, owners can ask friends and relatives for short-term loans or can use their own credit cards for business expenses like rent, supplies and services.

Have a Relevant, Believable Business Model

It’s nearly impossible to acquire funding for businesses that are not, at least on paper, good concepts. Imagine how a lender would view a loan applicant with a company name like “New York City Crop Dusting,” or “Alaska Air Conditioning Repair.” Those might sound extreme, but lenders do look for sound ideas that are geographically appropriate. Companies that might be more likely to get a second look from lenders would include names like “Minnesota Chimney-Cleaning Company,” and “San Antonio Lawn Care Service.” The basic business idea needs to be not only viable by logical.

Have a Detailed Business Plan

This is where so many start-ups get stopped cold. It’s not enough to have a few notes about the “goals of the company.” Owners need to work up a detailed business plan that follows a specific format and includes prospective financial statements, marketing analyses, and more. For owners who can afford it, it’s wise to hire a professional to create a solid business plan.

Get a Few Customers on the Books

Most lenders say that it is a huge plus for prospective borrowers to already have at least one customer on the books before applying for a loan. Those first customers lend credibility to the business concept and demonstrate to potential lenders that there really is a market for the idea.

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