Raising Business Startup Funds with Bad Credit

Do you have a business idea in mind, but you are not sure of how to fund it? One of the main reasons why many businesses fail in their initial stages is due to poor planning and lack of funds. Before rushing to make that business idea a reality, you should work on ensuring that you have enough money to start and run the business.

However, we can all agree that getting enough money to start a business all at once is not a simple as it may sound. It could take you years before you get there. Starting and running a successful business comes with lots of expenses, but again, you should never let lack of funds crush your dreams. Luckily, there are ways for you to raise fast funds and make your dream come true sooner than you thought. Let’s have a look at some business fund sources to boost your idea.

Alternative financing

Loans are always the best and easiest way to raise money, but what happens when you have bad credit, or you fail to qualify for bank loans.  There is still hope for you, and you can still be eligible for financing without necessarily having good credit. With trustworthy alternative financing companies, you can rest assured of getting fast funds to start your small business. The best part is that you get the loans at very fair interest rates. The company works by partnering with established financial institutions to ensure that there is something for everyone regardless of how much you need for the startup. Take your time, plan on how much you need, and look for trustworthy companies like Thinking Capital and let them help you make your dream come true.

Borrow from friends or relatives

This is the perfect time for your family and friends to show how supportive they are. You should never underestimate the power of a good friendship. If you follow the right strategy, you will undoubtedly raise enough money to boost your business idea. You should, however, prepare your plan and present it to them. Make it super convincing to have as many of them contribute.

Try angel investment

The other easy yet effective way to raise funds for your small business startup is through an angel investor. Who is an angel investor, you ask? This can be termed as an accredited individual who has a net worth of more than 1 million dollars or an annual income of at least 200, 000 dollars. The angel investors work alone but may team up with other investors for funds. With this, it is evident that angel investors can comfortably source your small business capital. But this will only happen if you have a solid and convincing business plan. Nobody will want to risk their funds in a gamble. The investor will only invest in your idea if s/he finds potential in it. Take your time and come up with a great idea before pitching it to different potential investors until you find the one.

Bootstrapping

Bootstrapping is an excellent idea, especially if you intend to start a business that does not require much-starting capital. How does this work? This is basically starting a business with your own money without necessarily looking for an investor. By bootstrapping, you can get a zero-interest or low-interest annual interest rate credit card. With this, you can borrow funds for a particular period without any interest. With such offers, you do not have to worry about the many risks that come with funding a business with your savings. It is a matter of believing in yourself and your vision and then taking the risk. With this, you will be comfortable investing your funds in the business even without an idea of how things will turn out. Also, investors and lenders are more likely to consider your idea and partner with you after seeing that you are serious about it, and you are willing to put in your savings.

Owning a business is most people’s dream, but finances have always been a limiting factor. With these tips, however, you will undoubtedly raise enough funds to boost you as you chase after your vision.

Author: Chakraborty

Dr Chakrabarty is the Chief Innovation Officer of IntuiComp TeraScience. Earlier she was Assistant Professor of Delhi University, a QS ranked university in India. Before that she has held research positions in IIT Mumbai, IIT Chennai and IISc Bangalore. She holds 2 patents and over 20 research publications in her name which are highly cited. Her area of research is in smart technologies, integrated devices and communications. She also has a penchant for blogging and is an editor of Business Fundas.