Starting a small business can be one of the most rewarding and financially lucrative decisions you will ever make. It is no surprise then that there are over 30 million small businesses in the United States. Perhaps more impressively, nearly 50% of the American workforce are employed by small businesses.
Small businesses promote creativity, the entrepreneurial spirit, and a sense of independence that can be hard to find in a larger corporate setting. Additionally, there are a dizzying amount of different types of small businesses that can turn out to be lucrative for the owners.
Types of Small Businesses
- Consulting Firms
- Public Relations
- IT Solutions
A complete list of small business ideas would be impossible to compile because of the sheer range of possibilities. When you want to start a small business, you must think of a skill that you have that you know will be in demand. Once you have the idea, create a business plan that lays out your expenses, expected growth, and profitability.
With a good idea and a well-formed business plan, you will be well on your way to starting a successful small business. With that being said, you will still need to find funding for your new financial venture, which can be a difficult process.
Read the tips below on how to fund your small business.
Outside investment is one of the most effective ways to fund your small business. If you manage to raise money from outside investors, have faith that your business plan is well constructed and potentially profitable.
Additionally, having outside investors who own a stake in your company will minimize your risk if your business does not manage to succeed.
So, how exactly do you attract outside investment?
Firstly, remember that in order to effectively attract outside investment, you must have a solid business plan. No one will want to go into business with someone who has not done their homework. Once that is complete, there are a variety of different ways to find people willing to invest in your new company.
Outside Investor Resources
- Business schools
- Online business communities
- Friends and family
- Angel investors
- Investing clubs
Make sure you do your research to find out which type of strategy would work best for you.
When you start a small business, it is always a good idea to start your funding journey through outside investment. However, if you can’t find enough outside investment to fully fund your small business, you can turn to a variety of loan options that will help you set up your business.
Government Small Business Loan
Small businesses are good for the American economy. As such, there are loan programs set up by the government that are designed to reward small business owners and entrepreneurs. The Small Business Administration, or SBA, is a government program that helps small business owners achieve their goals. The SBA promises lower interest rates and down payments, as well as no collateral needed for some loans.
If you don’t have a line of already established business credit, it can be difficult to receive a bank loan for your small business. However, depending on your credit, a bank might be willing to give you a personal loan that you can then use to help get your business of the ground.
A title loan is a great option if you have bad credit but are in need of cash in order to start a small business. If you own a free and clear title to a vehicle, you could qualify for a title loan.
While interest rates can be higher for a title loan, they will get you money quicker than an SBA or bank loan. Additionally, depending on the value of your car, a title loan might even be able to get you more money.
What Type of Funding is Right for You?
Starting a small business can be a daunting process. However, if you eventually find success through your small business, all the fear and sacrifices that go into building one will be worth it.
One of the most important things you need to do in order to start a small business is get enough funding.
Luckily, if you use the tips outlined above, you will be well on your way to owning your own small business.