Cash flow is critical, especially in the early days of a company. From startup to the immediate aftermath, having money for critical operations – from marketing and payroll, to simply keeping the lights on – is a mission essential task for any business. Access to capital is crucial. However, banks are often hesitant to lend to startups, which they see as high risk. Fortunately, there are alternatives. Here are some creative ways to obtain financing if banks won’t open their doors to you.
If banks turn you down, you can always go online. These days there are more venues than ever before to find sources of capital. Companies like Quicken Loans provide great options for people looking for alternative ways to finance. And there are great web services designed specifically to help startups obtain funding, like Kickstarter and GoFundMe. In fact, they can help you raise all the capital you need, without ever setting foot in a bank.
All in the Family
Another way to obtain funds to keep your company operating is to ask family and friends for a loan. Getting a business loan from people you know is a relatively common form of financing. It also offers advantages, too. You usually can get a lower rate of interest, and better repayment terms than you would from a traditional lender. And your relatives will likely be more willing to fund a riskier venture than a typical bank would.
Sell Your Invoices
Is it difficult for your company to pay the bills each month on time? Is there a gap between when your company’s bills are due, and when customers pay you? If so, you may want to consider invoice factoring. Invoice factoring involves selling your invoices (bills your clients owe you), to a specialty company, which purchases them at a discount. While this may cost you money you may otherwise have earned, it does help you keep cash flows positive, too.
If banks won’t open their doors to you, don’t give up hope; consider these nontraditional finance options to keep your cash flows healthy. And remember the team here at VerifiaBill. Our invoice consolidation and auditing services are designed to decrease your paperwork. We collect all of your invoices, and present them to you in one consolidated package!