Commercial financing for your business needs
What are the needs your business has? When you initially get started it is likely things like financing, equipment, and employees. As the company continues to grow and develop it will still be these same things as you will need to hire new employees to expand with the company and then you will also need to get new equipment to keep up with customer demands. All of these things require financing from your company. Commercial financing is a great way to build your business credit and to expand the company. Where can you find commercial financing for your business? There are a number of different avenues you can work with in order to find such financing. This article will discuss some of the areas that you can work with:
- Seed Capital - this money usually comes from your bank account or your friends and those that have a given interest in your company. Typically this is used to start the business and must be repaid as the business starts to make an impact in whatever industry you are in. Seed capital doesn't give you a huge amount of money but it should give you enough to get going.
- Venture Capitalists - this type of financing will come from a bank or hedge funds to provide you with money to get your business up and running. The companies or wealthy individuals that invest usually see a lot of potential in your business and they will feel that you have the chance to come up with some long-term investments for the company. To repay this type of financing you likely have to return them with preferred stock or appoint them to the Board of Directors for the company.
- Angel Investors - individuals that have a lot of money and see potential in your business will become your best friend. These individuals may fund your entire start up phase because they see the potential in the business and will make a nice profit off their investment. Usually you will get the money you need in small amounts over time so you really just pull when you need it.
Commercial loans for new businesses are typically hard to get as you will need to rely on your personal credit rating along with furnishing all of the documents to the lender such a business plan along with financial information, employment needs, equipment needs, and many other things. All of this information will help lenders to understand what type of loans you can qualify for and what they can provide you with.
Asset sale leaseback is another way that you can acquire money for the business. It is used for real estate needs and you will rent if from the buyer of the assets. Banks may provide this to you as they are helping you get started and they can benefit from the tax credits.
What happens if you have money to start but not enough to pay for equipment? Maybe you already have gotten started but you find that your equipment has run down and will cost too much to repair? A great option that is available is equipment leasing. It can provide you with the equipment so you can stay productive with your company and can protect the business from losing customers. Leasing is a great option because you simply make monthly payments and you don't need to worry about the upkeep and other things for the equipment needs.
Credit cards or lines of credit can provide you with emergency funds that you can draw from for the business needs. They will provide you with a great benefit as you are determined to expand the company when things are going well. Check for credit cards that offer you rewards as you can benefit greatly from these rewards.