Are you a business owner who has spent his/her entire life in service of your work? Have you sacrificed your family, friends, social life, and even your hobbies for that one thing that you dream about day and night? You dream about success and taking your business to new heights and to land a spot in the league with the big sharks in the vast expanse of the open ocean that is the world of business.
But by now you might have realized that hard work, focus on the aim and ingenuity are not the only things that you need to be successful at in this day and age. Today, you also need a good amount of finance for your business that can help your endorse and expand your business with a small boost. You might think that you do not have many options left to accomplish that, but that is where you are wrong. Because, today, there are multiple ways of attaining a good working capital that can even be better than traditional methods.
In this article, we will look at all the ways you can obtain business capital with the help of both traditional ways and the new innovative ways. We will compare them and talk about their advantages and disadvantages and finally also give our recommendation for which way you should go. But in the end, the choice will always be up to you. So, shall we begin?
Here are all the ways you can obtain financing for business:
1. Bank loans
This is the most obvious way of attaining business working capital. For centuries banks have provided loans to businesses for helping them out and catering to most of their financial needs. But as the world changed and grew, the world of business has changed with it. And when the world became fast paced and capricious, the world of business reflected just that.
Banks still remain unhinged from their archaic ways, and they are still following the same bureaucracy that has today become a challenge for business owners. Regardless, banks still operate in total accordance with the mandatory government policies, and you might find the interest rates still a bit applicable.
Advantages of bank loans:
- They are secured and assured.
- Due to their sheer size, you can easily get bank loans everywhere.
- There’s no chance for fraud.
Disadvantages of bank loans:
- The bureaucracies make the whole process slower and tedious.
- You will not get your working capital in a lump sum.
- You are restricted with how you can spend the loan money.
Approval rate is very low.
Crowdfunding is another finance for business method. And due to the surge of an interconnected web, it is much easier to get crowd funding than it was ever in history. Today, there are many dedicated websites like GoFundMe.com, where there are millions of people helping each other out with different causes and reasons to attain funds.
However, crowdfunding is still in its infancy. It does have a potential to take the world by storm, by building a community where no one’s needs go unnoticed. As it allows people to donate money quickly and without any problems.
Advantages of crowdfunding:
- Crowdfunding is one of the best ways of attaining funds. And you never have to pay it back.
- There’s no limit to how many funds you can gather because it takes the money from the masses.
Disadvantages of crowdfunding:
- The time it takes to reach your goal can be a few weeks to a few years.
- There is no guarantee that your business will be funded out of thousands of entrees.
- You have to appeal and make a whole campaign to pull people in. And the PR never ends.
3. Angel Investment
Angel investment, as the name suggests is a way of obtaining finance for business through the help of already successful and rich entrepreneurs. These companies or individuals are interested in working with businesses in their initial stages or the established businesses with big ideas to expand.
If you can find an angel investment, then there can be nothing better than that. This is because, in one large swoop, all of your financial problems can vanish due to these angel investors. Some of the biggest angel investors are Google, Facebook, PayPal, Elon Musk, etc.
Advantages of angel investment:
- Angel investments will provide you with all the finance in business that you require without any pay-backs.
- There are no bonds or limitations that you have to follow after attaining the funds.
Disadvantages of angel investment:
- These angel investors are scarce to come by and even harder to impress.
- If they are not satisfied with your work, they can pull the plug on you anytime they deem it fit.
4. Merchant Cash Advance
Merchant Cash Advance, according to our opinion, is the best way of getting finance for business. This is a process through which many business men have attained working capital for their business really quickly and directly.
The process is quite simple. You search and choose the most suitable Merchant Cash Advance investor from the thousands that are present online. You send your proposal, and because of a high acceptance rate, you will get called for a meeting. In the meeting, you will be able to negotiate your terms and then sign the contract. Soon afterward you will receive all the funds in a lump sum. You will pay it back through a fixed portion of your credit card sales.
Advantages of Merchant Cash Advance:
- The process is transparent, easy, and without any restrictions.
- The whole process can take place in just twenty-four hours.
- There is no bureaucracy involved and no restrictions on how to spend the money.
Disadvantages of Merchant Cash Advance:
- The interest rates are higher than that of banks.
- If you cannot predict your future sales, this will not do you good.
These are all the methods through which you can attain finance for business, Merchant Cash Advance being the quickest, and easiest option for small business owners. So, choose your option wisely and choose one of them after scrutinizing your needs. All the best!