Discover various funding sources to start or expand your business, ranging from family and friends to traditional financial loans and U.S. Small Business Administration programs.
In business, you need money to make money. Whether your goal is to start a new venture or to expand an existing one, seed money is undoubtedly the lifeblood of business. Regardless of whether your intended use of capital is for starting or expanding your business, know that there are many sources available to you.
The nearest source is not only the easiest, but it can also be the dearest. If you have family and friends who are willing to open their wallets for you, then you are in luck. Many of your family members and friends may be interested in investing start-up or expansion capital in your business. Try them out first, but just make sure that you repay them on time.
However, if you need a large amount of seed or expansion capital, you may need to look elsewhere. Not everyone is fortunate enough to have a wealthy relative with millions of dollars sitting idly in a bank account. If you are one of the less fortunate ones, your next possible source of capital will be loans from financial institutions. Generally, you will need to apply for a loan, and the application process usually requires you to submit a business proposal or plan. The lending company will evaluate your proposal and assess whether it is feasible and worthwhile. If your loan application is approved, make sure you repay your loan regularly and never skip a payment date. Regular payments increase your trustworthiness in the eyes of the credit institution that granted your loan. This increased trust will come in handy in the future, should you want to apply for a new and larger loan someday.
Another good option is the 7(a) Loan Program of the U.S. Small Business Administration (SBA), particularly its Express Programs, which come in three types: SBAExpress, Community Express, and Patriot Express. The common denominator among these three types of Express Programs is a leaner and quicker process for specific types of borrowers. SBAExpress is for small business operators. Community Express is for borrowers located in underserved communities, such as Historically Underutilized Business Zones and distressed communities as defined by the Community Reinvestment Act. Patriot Express is for small businesses owned or operated by veterans or military members holding at least a 51% stake. Depending on which type of Express Program you are eligible for, you can receive up to half a million dollars in capital. You can also expect a response from the SBA within 36 hours of submitting your complete application.
Each type of loan under the SBA’s Express Programs has specific eligibility requirements. The list of requirements, along with more helpful information and downloadable forms and documents, is available on the SBA’s official website at sba.gov.
Investments from family and friends, loans from financial institutions, and the SBA’s Express Programs are just a few of the various funding sources you can explore to start or expand your small business. Other sources exist as well. The most important thing to remember is to select the right one for you.
Obtaining Seed Money to Start or Expand Your Business
Discover various funding sources to start or expand your business, ranging from family and friends to traditional financial loans and U.S. Small Business Administration programs.
In business, you need money to make money. Whether your goal is to start a new venture or to expand an existing one, seed money is undoubtedly the lifeblood of business. Regardless of whether your intended use of capital is for starting or expanding your business, know that there are many sources available to you.
The nearest source is not only the easiest, but it can also be the dearest. If you have family and friends who are willing to open their wallets for you, then you are in luck. Many of your family members and friends may be interested in investing start-up or expansion capital in your business. Try them out first, but just make sure that you repay them on time.
However, if you need a large amount of seed or expansion capital, you may need to look elsewhere. Not everyone is fortunate enough to have a wealthy relative with millions of dollars sitting idly in a bank account. If you are one of the less fortunate ones, your next possible source of capital will be loans from financial institutions. Generally, you will need to apply for a loan, and the application process usually requires you to submit a business proposal or plan. The lending company will evaluate your proposal and assess whether it is feasible and worthwhile. If your loan application is approved, make sure you repay your loan regularly and never skip a payment date. Regular payments increase your trustworthiness in the eyes of the credit institution that granted your loan. This increased trust will come in handy in the future, should you want to apply for a new and larger loan someday.
Another good option is the 7(a) Loan Program of the U.S. Small Business Administration (SBA), particularly its Express Programs, which come in three types: SBAExpress, Community Express, and Patriot Express. The common denominator among these three types of Express Programs is a leaner and quicker process for specific types of borrowers. SBAExpress is for small business operators. Community Express is for borrowers located in underserved communities, such as Historically Underutilized Business Zones and distressed communities as defined by the Community Reinvestment Act. Patriot Express is for small businesses owned or operated by veterans or military members holding at least a 51% stake. Depending on which type of Express Program you are eligible for, you can receive up to half a million dollars in capital. You can also expect a response from the SBA within 36 hours of submitting your complete application.
Each type of loan under the SBA’s Express Programs has specific eligibility requirements. The list of requirements, along with more helpful information and downloadable forms and documents, is available on the SBA’s official website at sba.gov.
Investments from family and friends, loans from financial institutions, and the SBA’s Express Programs are just a few of the various funding sources you can explore to start or expand your small business. Other sources exist as well. The most important thing to remember is to select the right one for you.
Obtaining Seed Money to Start or Expand Your Business
By Howtodotips
Discover various funding sources to start or expand your business, ranging from family and friends to traditional financial loans and U.S. Small Business Administration programs.