Alternative Financing Might Be a Good Option When Banks Deny You
If you’ve denied for a bank loan, you still have a variety of financing options available. Many small businesses will struggle to grow without funding. For many reasons, your business loan may have been denied. In order to receive the financing you need to get your business started, learn about popular options and benefits of alternative funding.
Crowdfunding is a modern and dynamic way to receive a business investment. The key to successful crowdfunding is creating an engaging funding page. By marketing your business strategically, you’ll not only have a chance to receive the financing you need, you’ll also increase customer awareness and gain valuable information about customer interest.
Consider contacting personal investors. A venture capitalist may have the alternative funding you need. If you have a high growth model for your new business, you’ll have a strong application for venture capital. Look for investors who are familiar with your industry, and create an effective sales pitch describing why you believe your company will earn a profit.
There are numerous government grants available for many industries. Look for government or non-profit organizations who are looking to provide alternative funding for new businesses in your industry. Whether you’re promoting job growth, conducting research or your business will benefit the public, there are lots of different grants available in most industries.
Similar to venture capitalists, angel investors are also individuals who can provide financing for your business. Typically, an angel investor is also looking to provide guidance and mentorship, so you’ll need to find an industry-specific investor. Creating a winning sales pitch and a track record of personal or company success will be critical to receiving funding.
Finally, many businesses who fail to receive financing from a bank simply choose to self-fund. Self-funding, also known as bootstrapping, is simply using your own finances to grow a business. Often, this simply means operating the business without receiving pay. Payroll is one of the largest expenses for many businesses in the initial phase. By giving your time and energy to your business without receiving a paycheck, you’ll be able to grow your business to a stage where it is successful enough to re-apply for financing or choose another form of alternative financing.
Not all small businesses receive financing from the bank. If you’ve been denied a bank loan, don’t worry. Choose a flexible and competitive alternative funding source in order to grow your business successfully.