Starting your own business has been your life-long dream. And while unemployment is at an all-time high and many who are employed are facing layoffs, some would advise that it’s the perfect time to pursue your endeavor. So, you research your proposed idea and write a detailed business plan. Now the real challenge – finding financing.
The following are six options for financing your dream:
- Personal Savings
- Performance Bonuses from Employment
- Income Tax Returns
- Family and Friends
- Bank Loans (debt financing)
- Investors (equity financing)
- Angel Investors
- Venture Capitalists
The method of financing that you choose will depend upon several factors, including how much money is needed and how much control of the business you’re willing to share. You may also consider working with a Small Business Development Center (SBDC) that can provide financing through one of their preferred lenders. These centers also have micro lending programs for start-ups that need limited funding. To qualify, they generally require that you complete an entrepreneur-training program. The program includes a variety of business development courses that take approximately 6-8 weeks to complete. In addition, they provide a range of business support and technical services. Professional consultants are available to provide advice in business plan development, financial management, marketing, loan packaging, etc.
SBDCs operate under the Small Business Administration (SBA) www.sba.gov. SBDCs are located throughout the United States, the District of Columbia, Guam, Puerto Rico, American Samoa and the U.S. Virgin Islands. To locate an SBDC near you visit http://www.sba.gov/aboutsba/sbaprograms/sbdc/sbdclocator/SBDC_LOCATOR.html.
Sherice L. Bellamy, SLB Associates, provides business planning and development services to small businesses and entrepreneurs.