What is the best way to finance your business?

Small Business Forums Accounting and Finance What is the best way to finance your business?

This topic contains 4 replies, has 4 voices, and was last updated by  Anthony Pistole 1 month, 3 weeks ago.

  • Post
    Anthony Pistole
    Participant

    I am new at this and this will be my first venture trying to start a business so I’m number of options All of these would require me to have some form of financing . Is it better for me to save up and use my own funding as an independent lender or should I try looking into my banks options? Any options you guys have would be greatly appreciated.

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  • Replies
    Joel Slatis
    Keymaster

    I’m a firm believer in having your own resources and staying out of debt. The truth is, you always have to pay the debt one way or another. There’s never a time when you just get something for free. For instance, if you were to borrow, you’d need to secure the loan with a personal signature. Unless you’ve got a track record and lots of resources, you’re not going to get financing without it.

    Now, if you’re 100% sure you can make money with your business, you could decide strategically to take a loan in the interest of getting things going more quickly, but that would be a bet you’d need to be willing to take. If the business fails, you’ll still owe someone and you won’t have any income so you’ll be paying out of pocket.

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    Candice C.
    Participant

    I think it depends on what you’re doing. Are you able to save up enough money in a reasonable amount of time to try what you’re doing? Is taking a loan required in order to run your business? Lots of businesses need loads in order to operate. I think it really depends on knowing more about your specific financial situation to be able to answer that question, as the answer depends entirely on what your doing.

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    Julia Merrace 
    Participant

    It boils down to these few options. Either you can borrow, find some investors, or spend your own money. If you borrow, then you can choose from banks, private money, etc. investors will want to own part of the business and exercise some measure of control. So in the end, like everything else, the answer tends to be specific to what you’re trying to achieve. In other words, your specific business and how you run it will usually dictate the type of money you get.

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    Anthony Pistole
    Participant

    I guess this will be down to my time table, saving takes time but it has the advantages of not having to pay anyone back. That in itself is a huge advantage but the added income from an investor would help immensely. You guys gave some good insight, thx.

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