Finding funding for a business venture can be really hard. Sometimes taking out a personal loan seems like the only option. But taking out a personal loan to fund something that may or may not pan out is daunting. In our hearts, we want to take that kind of risk. We want to believe that everything will be ok. But in our minds, we know that it would be better to find a different way to fund our endeavors. Even if we believe our business venture is a sure win, taking out a personal loan should only be used as a last resort. Here are some options to explore to open your small business venture. Some options require time, work, and perseverance, but when it comes to business, if you are shy about doing the work and putting the time in, you should probably re-think opening a business at all.
Grants: This is the first place you should look. Unlike loans, grants do not need to be re-paid. It is money free and clear because the grantee believes in your endeavor as much as you do. Some grants are specific to idea topics, such as tech grants, environmental grants, etc., others are specific to the number of years of experience in a field you have, others are given to minorities or women who apply. Do an online search of available grants and make a list of all the grants you might qualify for. I’ll bet you can find at least ten to look into. It’s a grueling process to apply for them so make sure you meet all of the qualifications before taking the time to fill out the forms.
Loans from family members: I know… big groan here. It’s always said that you should never borrow from family. However, some families have the ability to work together toward a goal and when the goal falls apart, they brush it off. Consider taking out several smaller loans spread across different family members so that if your business goes belly up, it won’t be as big of a hardship for family members to wait to get re-paid. Remember you are taking out a loan from them. If your business goes belly up, you still have to pay.
Home equity lines of credit: If your business needs smaller infusions of cash over time, consider a home equity line of credit. In this way, you can take out smaller amounts, re-pay it, then take out another amount, then re-pay it. It’s a good way to remain relatively debt free but still get the cash you need.