Archive: 2014

Every start-up begins with enthusiasm and energy, but unfortunately a business cannot survive on optimism alone. Having enough working capital is at the heart of successful firms. In fact, according to Bloomberg, eight out of 10 businesses fail during the first 18 months simply because they run out of cash. Here are three strategies to implement to make sure your company does not suffer the same fate: 1. Fill Your Rainy Day Fund This is obviously easier said than done, but have a well-stocked […]

Business owners can refinance their commercial mortgage loans in many different ways to improve their financial outlook. Here’s a look at some of the most popular reasons to refinance a commercial mortgage: 1. Cash-Out Refinance If a business owner has accrued a significant amount of equity in the commercial property, it may be possible to pull out a portion of it as cash to be used for other purposes. This can be an effective way to finance property repairs or improvements or even provide […]

The U.S. Department of Agriculture announced earlier this month plans to extend loan help to even more small business farmers, most notably by increasing the loan limits on its microloan program. Farmers with small to medium sized operations will now be able to apply for microloans up to $50,000, a $15,000 increase from the current limit. Microloans are small amount loans typically made to underserved populations, especially those that have a hard time obtaining financing with traditional lenders […]

Starting and running a business requires capital. The source of that capital can be variable depending on which stage a business is in. Below is a quick rundown of the most popular methods of business financing. Angel Investors Angel investors contribute money typically to fledgling businesses and they do so because they want to see the company or owner succeed. The money does not generally have to be repaid but investors may want some equity share or other remuneration. Bank Loans Banks […]

Small businesses looking for working capital often have to look to many sources to find all they need. One possible solution for cash-strapped companied could be a merchant cash advance loan. With these loans, borrowers can receive a lump sum of money, which is then repaid from future credit card sales. While a cash advance loan can be very helpful, entrepreneurs need to consider all the risks as well. PROS Easy to Qualify Merchant cash advance loan credit standards are very minimal. Businesses […]

Starting up a small business requires a lot of capital. In order to meet those capital demands, entrepreneurs will often use their own funds plus borrowed money in the form of credit cards or home equity lines of credit. While these types of financing may be necessary to get the business off the ground, small business owners should establish a business credit profile as quickly as possible to save their personal credit scores from damage. Beyond just the risk of credit injury if the business fails, […]

So-called alternative lenders in the small business lending market have been growing exponentially since the financial crash, filling a gap in available credit when traditional lenders cut back on business loans. Yet these alternative lenders often make loans with annual percentage rates (APRs) as high as 135 percent. How could a loan with that much interest actually benefit a small business? Here’s a few reasons why an alternative loan might sometimes make sense: Limited Time Bank loans can […]

Many small businesses contract with large companies that take the full 120-day limit to pay their bills. The result is that the small firms often come up short in terms of working capital between payments. And unless those small companies offer a product or service unavailable in the rest of the market, they have little negotiating power with the big firms. This situation makes for some tough choices for small businesses. Take a Discount These big companies will often offer payments earlier than […]

The small business lending atmosphere, while getting better, is still chilly today compared with before the 2008 financial crisis. Small firms applying for loans are coming up against several major obstacles. In order to be approved for critical funding, small business owners need to know how to push past these hurdles. One of the major changes since the Great Recession is there are fewer lenders in general, and specifically fewer community bankers. This is an important challenge because community […]

Once you have struck upon your big idea for a business and made a plan for how to begin, the next step is to raise up enough cash to get started. How do you know how much money you will need? Here are 2 strategies for determining how much you need to fundraise. Set a Goal For First-Round Funding One action plan suggests that you start with careful research to set a funding goal for your first stage of business. This includes talking with potential clients or customers to understand what they […]