Securing funding for your small business can help its growth, or can ensure its survival during a rough patch. Small business funding is no small deal, so it’s important to think about the options you have at your disposal.
There are two basic ways to externally fund your small business: debt and equity. With debt, an investor receives a note for the money invested that details the terms of repayment. This method allows you to retain full control of your company. There are a number of ways to use this method, including borrowing from small business lenders, the Small Business Administration, or traditional banks. With equity, you turn over an ownership stake to an investor in exchange for money. This means that you don’t have to repay the investor, but you may be relinquishing some control. Taking on a partner is one way to do this, or you could seek out an angel investor. There are plenty of other options out there, though. Bootstrapping – allowing the business to fund itself, growing over time – is challenging but worth it if you can make it work. Crowdfunding is an increasingly popular path, though it requires careful planning, research, and great execution. Which method looks the best to you?
Read the full article here: 10 Ways to Fund Your Small Business